Kentucky Business Group Fears Time Running Out On Pension Reform
The election is over, and for Kentucky, the political focus now shifts to the 2013 General Assembly. The state Chamber of Commerce says the top priority has to be reforming Kentucky’s public pension systems. Chamber President Dave Adkisson says a task force created to study the problem needs to reach a consensus in the next 60 days.
"If that bipartisan group can’t come to some consensus between now and the first of the year and take to the legislature a compromise consensus package that the legislature can deal with at that time. I’m not very hopeful that when they really get heated up in the legislature that you would be able to get consensus," explains Adkisson, a former Owensboro mayor.
Adkisson fears pension reform may get lost among other weighty issues like redistricting and tax reform.
The state employee and teacher retirement systems have a $30 billion funding gap.
"If the pension issue in not fixed in this legislative session there will be less funding for schools," adds Adkisson. "I don’t think state employees will be able to expect pay raises in the foreseeable future. There will be service cutbacks. Various construction projects would have to be cancelled and our ability to recruit jobs in Kentucky will be scaled back."
Adkisson points to a recent Barrons report that ranked Kentucky’s financial situation 47th nationally because of the unfunded pension liability and the state’s debt.
Also, two major bond rating agencies downgraded Kentucky’s rating, which means it will cost taxpayers more for public building projects.