FRANKFORT, Ky. (AP) — Retired public school teachers and their allies crammed into a legislative committee hearing in an election-year show of force against a public pension overhaul that Kentucky lawmakers began reviewing Wednesday.
A Republican-led Senate committee heard testimony on the measure but took no vote on a plan to revamp one of the country’s worst-funded public pension systems. The political peril was reflected in stickers worn by some in the audience: “My Family and I Will Remember Your Vote.”
“This bill takes away promises made to public school employees when they were hired and when they retired,” said Stephanie Winkler, president of the Kentucky Education Association.
In another twist, the state’s attorney general sent a letter to lawmakers warning the pension overhaul as drafted would not survive legal challenges almost certain to follow if it became law.
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Against those headwinds, the bill’s chief sponsor made his case for the overhaul as the Senate State and Local Government Committee began work on a defining issue in Kentucky.
The state’s various public pension systems are among the worst-funded in the country. The state is at least $42 billion short of the money required to pay benefits over the next 30 years, according to official estimates.
“The pension crisis is real, and this plan will get us on the right path to making sure our pension systems are properly funded,” said Sen. Joe Bowen, the committee chairman.
Public school teachers would see the most changes. Bowen outlined proposed changes to the bill, including one that would revise a cutback in cost-of-living raises for retired teachers.
Retired teachers now get a 1.5 percent cost-of-living boost every year. The original bill would cut that raise to 0.75 percent, at least until the retirement system is 90 percent funded. The proposed substitute would give them a 1 percent annual raise until the system reaches that level of funding. That could take a while, because the system is now about 56 percent funded.
Bowen, an Owensboro Republican, said the bill’s authors have made a series of concessions to the bill’s critics. But the latest changes didn’t appease opponents.
Retired teachers and their supporters filled the committee room, with some standing or sitting in the aisles. Those unable to find a seat watched from other rooms in the Capitol complex.
In the hallway, Paula Adams and other retired teachers held up signs denouncing the bill. Adams said she would have to make cutbacks if her cost-of-living raise is trimmed.
“That’s what we’re counting on to retire,” she said. “That’s what you pay your bills with. I taught 38 years and I paid in 38 years, and I expect them to honor their promise to pay my money. That’s what they owe me. I paid it, it’s my money.”
Bowen’s defense of his overhaul bill was met with audible sarcastic remarks from some in the audience. When he announced that the committee would vote later, once members and stakeholders have time to review the changes, someone called out: “We’ll be back.”
Later, retired teachers and others gathered at the foot of the stairs leading up to the House chambers, holding signs and chanting: “Find funding first.”
Republican Gov. Matt Bevin, who has urged lawmakers to tackle the pension woes, has proposed spending $3.3 billion on the pension system, or about 15 percent of all state spending. The bill’s foes have urged lawmakers to find other revenue sources to help shore up pensions.
Meanwhile, Democratic Attorney General Andy Beshear warned lawmakers in a letter that the pension bill would break the inviolable contract between the state and its public employees.
“You promised Kentucky’s public employees that, in exchange for their public service, they would be guaranteed certain retirement benefits,” Beshear wrote in the letter dated Wednesday.
His prediction to the GOP-led legislature if the measure passes: “You should expect numerous lawsuits, which the commonwealth will lose.”
Bowen criticized the timing of Beshear’s letter, saying he waited until “the 11th hour” on an issue lawmakers have wrangled with for months. Bowen introduced the bill last week.
Asked later by a reporter if proposed changes to the bill were an attempt to put it on safe legal ground, Senate President Robert Stivers replied: “It’s a lot of it.”
“We want to make sure that we are in some place that is legally defensible,” he said.
Beshear said later that the proposed changes, as outlined in committee, would still fail to withstand a legal challenge.
The legislation is Senate Bill 1.