Interesting and lean times for pension fund
The 2015 General Assembly is ending with scant attention paid and no substantive funding solution proposed for the nation's worst-funded pension plan, the Kentucky Employees Retirement System non-hazardous plan.
The inaction ensures this plan, covering most state employees, will continue to decline over the next year. It lost about $166 million during the first six months of the fiscal year, and now has assets totaling less than $2.4 billion. A market correction could doom KERS. Should the asset balance drop to $1.4 billion, KERS officials will be forced to cash out long-term investments to pay benefits.
This would spell disaster for a defined-benefit plan that relies on investment income to pay most benefits. The cause of this crisis was more than a decade of underfunding by governors and legislators.
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KRS stakeholders now look to 2016, when a new governor will confront this crisis. There will be few options. Benefits have been reduced to the extent allowed by law, and any further plan redesign is irrelevant to addressing the existing unfunded liability. The only solution is more money. A purported Chinese curse says, "May you live in interesting times." Taxpayers will confront that curse next year. Interesting times, indeed.
Teachers need retirement plan
The Kentucky General Assembly has an opportunity to put the struggling Kentucky Teachers Retirement System on sound financial footing with the approval of House Bill 4.
With bipartisan support, a vote of 62-31, (eight Republicans joining 54 Democrats), the bill passed the House and is now in the Senate.
Under the bill, the state would, through a $3.3 billion bond, shore up the system. Skeptics say Kentucky cannot afford to add to its existing debt obligations. Those who support HB 4 indicate that, with historically low interest rates, the bond could be approved foraround 4 percent for 30 years. This money would then be turned over to the retirement system.
With the system's 20-year track record of over 8 percent return on investments, this would ensure repayment of the bond, plus around a 4 percent projected profit return. According to Moody's Investor Services, Kentuckys financial rating could face downgrading if the pension problem is not addressed.
No one likes to borrow money. This predicament could have been avoided if the legislature had fulfilled its obligation. Now the House has stepped up to correct this problem and it's time for the Senate to do the same. There is an old saying: Sometimes you have to spend money to save money. Now is that time. Our teachers deserve it.
Protect Good Samaritans
A growing number of people in the region have faced the harsh realities of combating drug addiction, whether in their own families or those of a friend or neighbor.
There have been too many deaths that could have been prevented if a bystander didn't hesitate to call 911. Too often these calls are not made because people fear getting in legal trouble.
Saving lives must be the top priority. Protecting 911 callers from arrest and charges at the scene of an overdose will ensure emergency personnel provide treatment in the moment that could be the difference between life and death. These protections are called "no-charge Good Samaritan" provisions.
Such protections have been adopted in 22 states and are currently being debated in the Kentucky legislature. I encourage fellow Kentuckians to call our lawmakers and urge them to adopt "no-charge" Good Samaritan provisions to save as many lives as possible.
Vote no on more taxes
The fact that House Bill 1, the local-option tax, is being seriously considered is mind-boggling. What would cities do with this new taxing power? Well, proponents could want us to pay a new tax to improve tree canopies, create botanical gardens and build amphitheaters. And they argue we should support this tax because these projects will be voted on by local citizens in their own local communities.
But the reality is that many of us will end up paying for projects in neighboring communities that we didn't get to vote for. That's not exactly democracy at work.
This tax increase is not only bad for consumers, but it is equally bad for business. I work for a family-owned business with strong roots in Central Kentucky that serves the horse industry beloved by so many Kentuckians.
An additional one-percent tax puts yet another burden on our state's signature industry. This new tax will increase our cost of doing business because we pay sales tax on the supplies and the utilities we use.
Please tell your state senator to vote "no" on HB 1.
The envelopes, please
Frankfort's reality show:
Legislators' top performers for 2015, Senate Leader Robert Stivers and House Speaker Greg Stumbo for spending thousands to study the Legislative Research Commission problems with no resolutions.
They should try large signs: "Keep your hands to yourself." Who knew state employees "serve at the pleasure of the legislators." Why aren't legislators serving at the pleasure of voters?
Best bill going nowhere: Senate Bill 11, by Sen. Reggie Thomas, which requires legislators and speakers before committees to take the same oath witnesses do in court: telling the truth, the whole truth and nothing but the truth.
Republicans want everything on fast track: no disclosure and no recourse with a hammer the top tool in the political box.
On minimum wage, lawmakers want to keep workers poor while encouraging more businesses to cry for tax abatement, TIF credits on taxes they aren't paying. The AT&T bill lets rural areas use smoke signals. Deregulate all services, put public utilities into private hands, no oversight or public accountability allowed.