A nonprofit publication of the Kentucky Center for Public Service Journalism

Senate President Stivers says pension reform bill has ‘limited, difficult’ path forward; hints special session

By Tom Latek
Kentucky Today

About a week after assuring he had the votes to pass Senate Bill 1, the controversial pension reform bill, Senate President Robert Stivers now doubts it will happen during the 2018 General Assembly.
“I think it has a very limited and difficult path forward at this point in time,” the Manchester Republican told reporters after the Senate adjourned on Wednesday.

When asked what could be done to save it, Stivers said: “I’m not sure.”

This also dooms SB 66, which would have phased in a huge increase in pension funding for local governments, schools, quasi-governmental agencies and others, who face a more than 50 percent increase starting in July.

Senate President Robert Stivers said the pension reform bill has a “difficult path” to be passed in the 2018 General Assembly. (Phot by Tom Latek, Kentucky Today)

“We can’t control the expenditure side because there’s no SB1 or comparable mechanism,” Stivers said.  “Therefore, you can’t phase in something that is continuing to grow, because your unfunded liability is not stopped.  It will continue to grow.”

He cited some examples of the costs to local agencies.  

“Jefferson County government will go up $42 million, Fayette County about $13 or 14 million.”

School boards will also take a big hit, he said.

“Fayette County will see a $6 million increase, trying to slow what the unfunded liability will accrue,” Stivers said.  “There will be other counties that will be hit with multi-million dollar assessments, because we haven’t stopped the bucket from leaking.”

He fully anticipates a special session will now have to be called to deal with the issue. 

“I do not want to come into a special session, but it may be necessary,” Stiver said.  “I do not want to lose this institution’s prerogative to do a veto override, so I am looking at legislation where we can suspend our pay during veto override sessions, if we do have to get called back.”

A governor has 10 days after a bill is passed to sign, veto or let it become law without his signature.  During regular sessions, lawmakers go on a 10-day recess before returning to consider veto override votes. Stiver’s proposal would do the same thing during a possible special session.

When asked if he thought the pension bill was dead because there weren’t enough votes in the House, Stivers said: “We are where we are. The House is doing what they are, we’re doing what we are. I didn’t want to bring it to a vote, because of all the circumstances around SB 1 at the time.”

As for whether there were enough votes to pass the Senate, Stivers said, “That’s debatable.  Some people will say certain things, I may disagree with them, they may disagree with me.”

Stivers maintains it would be constitutional to pass legislation suspending lawmakers’ pay during a veto override recess in a special session.  “There’s a part of the Constitution that says we cannot change our pay during a session, it must take effect the session we are in.  So, this would apply to a special session, and I dare any of my colleagues to challenge it.”

Kentucky’s unfunded liability for the public pension plans is one of the highest in the nation, estimated to be between $40 and $60 billion, depending on whose numbers are used.

The 2018 regular session of the General Assembly is scheduled to end on April 13.  

Wednesday was the 49th day of the 60-day session. 
There has been no response to a request for comment from Gov. Matt Bevin’s office.

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