SENATOR JOE BOWEN COMMENTS ON REP. JAMES KAY’S TRANSPARENCY BILL

For Immediate Release
Contact: John Cox
859-492-2963
John.Cox@LRC.KY.GOV

FRANKFORT, Ky. (September 15, 2016) The following is a statement from Senator Joe Bowen (R-Owensboro), regarding pre-filed legislation announced yesterday from Representative James Kay (D-Versailles):

“In the 2016 General Assembly session, the Senate Majority strived to shore up the state pensions for teachers and state workers by both committing hundreds of millions of additional funds in the budgetary process, and by making the pension systems more transparent and accountable.  The full House of Representatives failed to vote on Senate Bill (SB) 2, the Senate pension transparency bill, as both standalone legislation and as part of a ‘super transparency’ bill.

On March 17th of the 2016 General Assembly session, the House State Government committee reported SB 2 favorably out of committee, with 20 ‘yea’ votes, 1 ‘nay’ vote, and 3 ‘pass’ votes.  Representative James Kay, a member of the committee, offered a “pass” vote.

Today, Representative Kay has essentially cut, pasted, and pre-filed a large portion of the contents of Senate Bill 2 from last session.  This is the same SB 2 that could not get enough support from him or House Leadership to be considered on the House floor, despite being reported favorably by the House State Government Committee.

Perhaps ‘better late than never.’  But does Rep. Kay and the House Leadership want to make substantive pension changes, or do they just want an election year issue?  There was no absence of opportunity to address these issues in the 2016 General Assembly session, but I assume these issues were not considered important to them at the time.  I am glad they now believe pension transparency and accountability are important issues.”

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OP-ED: Sen. Joe Bowen on Pension Transparency

COMMONWEALTH OF KENTUCKY
SENATOR JOE BOWEN

For Immediate Release
May 2, 2016
Contact: John Cox
502-564-3120
JOHN.COX@LRC.KY.GOV

The following is an op-ed submitted by Kentucky State Sen. Joe Bowen of Owensboro:

“Sunlight is said to be the best of disinfectants; electric light the most efficient policeman.”

– Justice Louis D. Brandeis (1856-1941)

These words were powerful in the early 20th Century when written by the former Justice of the Supreme Court and are arguably even more meaningful today.

As the primary sponsor of Senate Bill 2 (SB 2) during the 2016 Session, I sought to focus needed “sunlight” into the activities of the Commonwealth’s taxpayer funded state employee pension systems. Unfortunately politics got in the way and my efforts were fruitless. Key decision makers in the House of Representatives succumbed to the relentless opposition from the retirement system’s lobbyists and decided that transparency is not important.

The nearly $40 billion in liabilities of the retirement systems are a ticking time bomb threatening our entire state. Our retirement systems are ranked among the worst funded in the nation. Taxpayers deserve to know how the pension systems operate and legislators should to have the ability to set policy, not simply react to crisis after crisis. It is past time for change. SB 2 would have provided an opportunity for everyone interested in finding a solution to have the information they need to find those solutions.

Even my good faith attempts at compromise produced no results. The consequences of this inaction mean that you, the taxpayer, and state retirees (who are dependent on the systems for their checks) continue to be in the dark regarding how the systems make decisions. Decisions that involve investing billions of dollars.

Senate Bill 2’s key provision was requiring adherence to the state’s “Model Procurement Code” by the retirement systems. Meaning for the first time an open and competitive bidding when hiring investment managers. While establishing this process would have been victory enough, the bill also called for the reporting of management fees, transparency in investment performances, and Senate Confirmation of the Kentucky Retirement Systems’ Executive Director. Senate Bill 2 would have required more financial expertise of appointed board members and provided additional oversight from a watchdog group known as the Government Contract Review Committee.

The House’s failure to enact Senate Bill 2 does not mean the General Assembly took no action to solve Kentucky’s public pension crisis.  The Commonwealth will be making an unprecedented contribution of $1.28 billion above the recommended and required contributions to the pension systems.  A move I have been advocating for some time.  But this additional funding does not remove the need for more transparency.

“The most important political office is that of the private citizen.”

– Justice Brandeis

 

All is not lost. I have lived to fight another day and the retirement systems should remember that the 2017 Session of the General Assembly will be here before they know it.

 

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Note:  Senator Joe Bowen (R-Owensboro) represents the 8th District including Daviess, Hancock, and McLean counties.  He is chairman of the State and Local Government Committee and a member of the Transportation Committee, the Licensing and Occupations Committee, and co-chair of the Public Pension Oversight Board.  For a high-resolution .jpeg of Senator Bowen, please visit http://www.lrc.ky.gov/pubinfo/portraits/senate08.jpg.

SENATE PRESIDENT STIVERS ON NEW STUDY FROM ASSET PRESERVATION ADVISORS:

SEAL
Commonwealth of Kentucky
Office of Senate President Robert Stivers

For Immediate Release
June 17, 2015
Contact: John Cox
502-564-3120 ext. 202

SENATE PRESIDENT STIVERS ON ASSET PRESERVATION ADVISORS’ RECENT STUDY:

It has always been the Senate’s position that we will fix the Kentucky Teachers’ Retirement System’s (KTRS) pension problem.  The House Democrats’ solution of pension bonds is not the answer to the problem. A recent study released from Asset Preservation Advisors recommended investors to remain “highly selective” when purchasing bonds issued in our state.

This message comes as no surprise to the Senate Majority Caucus, as we were not willing to accept the $3.3 billion bond proposal from House Democrats proposed in House Bill 4 earlier this year. While we fully acknowledge the Commonwealth’s unfunded liability to KTRS, we were not about to risk further lowering our state’s credit rating by issuing the single greatest debt in the history of the Kentucky General Assembly.

When neither chamber could reach an agreement on House Bill 4, a conference committee was formed. We brought in a representative from the Governor’s Budget Office who said that would be impossible for our state to sell $3.3 billion in bonds in the proposed time of one year and that it would be extremely difficult and risky to sell even $1 billion in bonds. At that moment we knew the original language of HB 4 was no more than a political move by House Democrats, yet we kept working for a compromise.

Senate and House Republicans proposed the formation of a task force to analyze KTRS in order to identify systematic changes to make KTRS viable in perpetuity. We also proposed a good faith contribution to KTRS in the form of $50 million identified in the Budget Reserve Trust Fund. This was real money offered to a seriously underfunded system, but unfortunately, House Democrats walked away from our proposal leaving the $50 million on the table.

As recently as the last Legislative Research Committee meeting on June 3, Senate and House Republicans have asked for Gov. Beshear to follow through with our idea of a KTRS Task Force. We desperately need to take action to address our unfunded liability to KTRS, but we also must be responsible to taxpayers across the Commonwealth, which is why a comprehensive analysis is a vital first step to addressing teacher pension concerns.

The Governor has answered our call as he has assembled a “Work Group” for this very issue. We are appreciative to the Governor for realizing the severity of the KTRS problems and for taking some type of action in order to put Kentucky teacher pensions back on the right track.

I will be appointing two Senate members to this work group, whom I will announce in the near future.

This will not be an easy process but rest assured we are committed to our teachers and all Kentuckians and will continue to do what is right for the Commonwealth.

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Note:  Senate President Robert Stivers represents the 25th District, which encompasses Clay, Knox, Lee, Owsley, Whitley, Wolfe counties.  He serves as chairman of the Senate Committee on Committees and Rules Committee and the co-chair of the Legislative Research Commission.  Additionally, President Stivers is a member of the Senate Judiciary Committee.  For a high-resolution .jpeg of President Stivers, please visit http://www.lrc.ky.gov/pubinfo/Senate25.htm