Gov. Matt Bevin could be feeling the love from Kentucky’s public retirees, thanks to his successful push for catch-up funding for the teetering pension systems.
Instead Bevin’s appointment of a Madisonville dermatologist to the Kentucky Retirement System’s 13-member board is stirring up alarm among retirees — and we can’t say that we blame them.
Kentucky law specifies that the governor should fill the seat to which Bevin appointed Dr. Bill Smith with someone who has at least 10 years of investment experience in roles such as portfolio manager, professional securities analyst or investment consultant, university professor of economics or investment-related studies or “any other professional with exceptional experience in the field of public or private finances.”
Smith, who cites his mathematics degree as a qualification, wrote a column last summer published in several Kentucky newspapers expressing opinions about the pension system that should disqualify him as a trustee.
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He called the pension funds a Ponzi scheme, questioned whether the state has an inviolable obligation to pensioners and accused retirees of manipulations that increased benefits beyond what the system could afford, contradicting the widely recognized truth that a succession of governors and legislatures created the crisis by underfunding the system.
We won’t even get into the dispute over whether Bevin had the authority to create the board vacancy by booting chairman Thomas K. Elliott, who has had a 30-year career in banking and whose term was unexpired. With the apparent backing of the other trustees and KRS executive director William Thielen, Elliott chaired a board meeting last week, in defiance of the governor’s order, while Smith sat in the audience.
The dispute could end up in a court fight — a distraction that no one needs, least of all struggling pension funds.
Jim Carroll, co-founder of the advocacy group Kentucky Government Retirees, said, “It is impossible to imagine an appointee less qualified by background or philosophy to contribute meaningfully to the KRS board of directors.” We have to agree.
Reforms enacted in 2013 scaled back retirement benefits for new hires and ended automatic cost-of-living increases for retirees. The state must not default on its promises to current and past employees or imagine that the pension crisis can be solved by blaming the victims.