The office of Governor Steven L. Beshear sent out an e-mail to all State Employees on February 21, 2008 outlining his ?plan? to overhaul the State Pension system. He announced key changes that he wants to make in the system to keep the system soluble. It is chock full of lies and half truths and does not address the real reason that the pension fund is in jeopardy in the first place.
Here is a basic outline of the plan:
The Cost of Living Adjustment (COLA) would be changed to and capped at 1.5 percent, to provide equity among teachers and other public employees.
The rules for returning retirees would be modernized. Under the new system, if you retire and then wish to return to work, you would continue to receive your original pension benefits, but you would not qualify for a second pension benefit. On the other hand, no new employee contribution would be deducted from you paycheck. (Gee thanks Uncle Steve!)Future hires for the police department would have to work 25 years before they are eligible to retire. Non-sworn personnel would have to work 30 years. (They also cannot draw their benefits before age 55-but he invites them to stay around and work longer)
The proposal will affect 445,000 state and local government workers and teachers.
In times when it is almost impossible to obtain qualified workers, teachers, Police Officers and Firefighters he will make it even more difficult for anyone to want to take one of these jobs.
He stated in his memo that the Kentucky Public Pension Protection and Modernization Plan will not affect members currently in the system, only future hires. HAH! Maybe I missed something. He said when I retire I can't start another pension. So much for planning on working at another agency once I decide to retire. The idea is for me to build my pension benefits while I am working on my new job and it would give me more retirement benefits when I do finally decide to hang it up for good. That affects me. I am curious as to what the agencies that depend upon hiring already trained people like Sheriff Aubrey does will have to say about this. Many Sheriffs are able to save a lot of money by hiring trained, seasoned employees and their agency doesn't suffer the expense of sending them to school plus they get the added value of being able to put to work immediately people that really know how to do the job.He said the COLA will only be a 1.5 % limit from here on out. (Last year is was 3.8% this year it is supposed to be 2.8%) That affects me. It also affects everyone currently retired who depend upon COLA (cost of living adjustment) because it is supposed to do just that. If the cost of living only rose 1.5% every year then sure, use that figure, but it isn't a COLA if it doesn't come close to matching the true figures.
Another concern voiced by those testifying at the meeting was the proposed COLA reduction. Kentucky Public Retirees Inc. (KPR) President-elect Shirley Clark said her group wants the COLA to remain tied to inflation."KPR worked very hard in 1996 to ensure a COLA based on the CPI (consumer price index). We hope the General Assembly will feel a moral obligation to provide retirees a COLA that is more in line with the CPI," said Clark, whose organization represents 78,000 Kentucky retirees.
Inadequate funding of the KRS pension plan concerned KRS Executive Director Mike Burnside, who said the state has not adequately funded the KRS pension system for 9 of the last 15 years. The system, which now faces over $20 billion in unfunded liabilities, relies on employer contributions for 20 percent of its funding.
So our wonderful Governor plans on penalizing the employees for government's inability to do their jobs. 9 times in the last 15 years the actuaries told the Governors and legislators that they needed to put ?X? number of dollars into the system for the State's yearly contribution and each time they failed to do so bringing us to the point we are at today.
Rep. Jim Wayne, D-Louisville, was one of the lawmakers who recommended that judges be included in those provisions. "I think it's our role to be leaders here and say everyone else is going to suffer and we think it's only fair that judges suffer, too," said Wayne. "It might not be the popular thing to do, but it's the right thing to do," said state Rep. Jimmy Higdon, R-Lebanon. Kudos to these guys.
It absolutely infuriates me that every time someone screws up big time in government, nobody goes after them for malfeasance of office. We have seen it in state government, we have seen it in our own local government but nobody does anything about it. To top it all off each time the government screws up they try and blame the problem on the little guy. It's always our fault when they screw up and they want to take more money away from us and cut our benefits because they are unfit leaders.