Friday, January 9, 2015
Important Pension Bill for Teachers Filed
On Friday, January 9th, 2015, Greg Stumbo, Speaker of the House of Representatives of the Kentucky General Assembly, filed House Bill 4 which provides a long-term funding solution for teachers' pensions. This plan has been a topic of discussion among legislators and has received strong support from teachers and education groups. The bill would ensure the retirement security of the Commonwealth's teachers by phasing into fully funding the annual contributions needed.
The components of the funding plan include an immediate infusion into teachers' pension funds of up to $3.3 billion from bonds issued by the Commonwealth. In filing the bill, Speaker Stumbo noted that current historically low interest rates provide a window of opportunity to develop a long-term funding solution.
The filing of House Bill 4 is a very important step toward a long-term funding solution for teachers' pensions. The General Assembly has recessed until February 3, 2015 when Part II of the 2015 Legislative Session begins. The 2015 Legislative Session is scheduled to adjourn on March 24, 2015. During the session, House Bill 4 will be discussed among members of the General Assembly and in legislative committees. Its passage would require approval by both Chambers of the General Assembly and the Governor. Leaders of both the Senate and the House have expressed their commitment to protecting teachers' pensions.
House Bill 4, and its progress during the 2015 Legislative Session, may be viewed by clicking on the web link at http://www.lrc.ky.gov/RECORD/15RS/HB4.htm
KTRS Financing Plan Presented to General Assembly Committee
KTRS was invited to attend the November 19th, 2014, meeting of the General Assembly’s Interim Joint Committee on State Government to present a financing plan for the KTRS pension fund. see more...
2014 Legislative Update
The State Budget that was enacted during the 2014 Legislative Session for the 2014-2016 biennium provides KTRS with the basic required statutory funding as well as the installment payments for sick leave compensation, previously awarded ad hoc COLA’s and minimum value benefits. It also provides a direct appropriation from the General Fund (as opposed to bonding) for the state’s obligation under the Shared Responsibility solution to funding retiree medical insurance. The State Budget does not provide the additional requested funding needed to maintain the pension fund on an actuarially sound basis. It states an intention that as debt service is paid off and reduced on bonds issued by the Commonwealth to repay past borrowings from the KTRS pension fund (and to pay prior biennia retiree health care costs), that the payments that are no longer required to be made to bondholders be continued in future biennial budgets as payments to the KTRS pension fund. This potential source of funding is certainly appreciated, but would not be sufficient to maintain the retirement system on an actuarially sound basis. Tight budgets, a struggling economy and a finite amount of revenue have made it very challenging for the Commonwealth to provide additional funding for the pension fund. Public officials and their staff are aware of the funding issue and KTRS is working with them to find a solution. The good news is that retiree medical insurance is now established on an actuarially sound basis as a result of the 2010 Shared Responsibility legislation so that this important benefit will continue to be there for active and retired teachers.
KTRS 2012 Legislative Presentation for KRTA
Legislative & Health Insurance Committees Meeting 11-14-2011
~ 2010 REGULAR SESSION Kentucky General Assembly ~
House Bill 540 – A Shared Responsibility Approach
to Funding Retired Teacher Medical Insurance
January 20, 2010 ~ KTRS Applauds Governor’s Proposal
Looking Forward to Long-term Solution to Pension Issue from General Assembly