General Assembly Taps The Brakes On Pensions
Kentucky leaders are sounding less-than-rosy about the prospects for new pension reforms, but they're not throwing in the towel just yet.
With one week of the 30-day session already in the books, the absence of a working pension package hasn't gone unnoticed — and leaders in both chambers are considering options beyond the regular session. Late Friday, legislators tasked a new Public Pension Working Group with studying the struggling retirement system and coming back with recommendations by Feb. 15th, but extensions could push that deadline back to as late as December.
House Speaker David Osborne said there is "a possibility" that lawmakers will leave empty handed in March. After adjourning Friday, Senate President Robert Stivers mapped out where the process stands.
"We are going to try to fashion something," the Manchester Republican said. "Whether it can be done in this session, I do not know. Or could it be done... in a special session after we adjourn? It may be appropriate to do that. But to do that, I believe we would need to have buy in, consensus, and be prepared to move as quickly as possible in a special session."
The caveats come as the Lexington Herald-Leader reports credit rating agency Fitch is downplaying the proposed structural changes to the underfunded retirement system, saying they would not likely affect the state's credit rating. Moody's, however, called the ruling against the GOP-backed reforms a "credit negative" for Kentucky. Gov. Matt Bevin called a special session in December in part over fears that the rating would take a hit following last year's failed attempt at reform.
Stivers says, for now, the system is stable, but without any action by the General Assembly state payments into the system will continue to balloon — placing an even greater strain on the state budget.