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No, Damon, We Don’t Trust You With Pensions

February 4th, 2013 · 7 Comments

Damon Thayer has been publicizing his latest email blast, so let’s read it in full:

Pension Reform Protects Present and Future

Frankfort, Ky. – On Tuesday, the Senate will gavel in for the second part of the 2013 General Assembly Session. I will be filing Senate Bill 2, the public employee pension reform bill. It will mark the eighth session that the Senate has presented ways to preserve and protect the retirement of state employees. It is my hope that with the cooperation of the House of Representatives and the Governor, this will be the last. SB 2 will make no changes to the Kentucky Teacher Retirement System. It will also not create a new tax on the pension income of former public and private sector employees.

Senate Bill 2 reflects the recommendations of the bipartisan Task Force on Kentucky Public Pensions. This task force consisting of senators and representatives, Republicans and Democrats, held of six intensive meetings last summer. The task force heard from public employee groups, businesses, unions, retirement system officials, retirement and pension experts, as well as nationally-known independent organizations and think tanks such the PEW Center and the Laura and John Arnold Foundation.

Here are the cold facts: Kentucky’s state employee pension system teeters on a fiscal cliff facing $30 billion in unfunded liabilities. This means state employees have been promised $30 billion more in benefits that the retirement system currently has in assets. How does this big problem affect you? If you’re a public employee, your retirement is safe because of the “inviolable contract.” But if you are a college-student nervous of tuition increases, a grandmother needing public transit, a small-business owner trying to meet pay-roll, or if you just need to get to work on a state road; then you should have some concerns. Because every extra dollar needed to pay for pension benefits is a dollar unavailable for another worthy purpose.

SB 2 protects taxpayers while creating a sustainable retirement benefit for state employees by recommending full funding of the actuarially-required contribution to the retirement system and creating a new hybrid cash-balance plan for future employees. The legislation provides the guarantee of at least 4% return of the money put in but also allows the state employee, if they wish, to leverage their contributions for higher gains. Further, any benefits accrued could be taken with them if they switch jobs. This hybrid cash-balance plan will provide future state employees with a secure retirement income and provide taxpayers with predictable costs that can be met without raising taxes.

President Dwight Eisenhower in his farewell address said, “We cannot mortgage the material assets of our grandchildren without risking the loss also of their political and spiritual heritage.” There are no easy answers but the Senate looks forward to a candid and robust debate on this important issue.

Thank you,
Senator Damon Thayer

Regular readers are already familiar with the Arnold Foundation shenanigans and the nonsense Damon Thayer has tried to spread. And it’s no secret that Pew/Arnold were/are being paid by the LRC. But if you need an even bigger reminder? Here you go.

Damon Thayer can scream all he wants about pension reform but here’s reality:

  • There is no pension reform in what he’s selling
  • It’s a push to turn the system into a 401(k) mess
  • There has never been and will never be an effort to hold the crooks accountable, despite claims from prominent Republican Senate staffers
  • Upping funding will not solve the problems at KRS in terms of the good old boy back scratching and placement fees
  • People like Damon Thayer will fight to keep their sweetened legislative pensions and that’s about it
  • Legislative secrecy like this will continue

For more of what you’ll likely never see? This was a nice start.

Tags: Corruption · Hypocrisy · Wasted Money

7 responses so far ↓

  • 1 Chris Tobe // Feb 4, 2013 at 1:40 pm

    Bunch of nothing. Promising full funding without identifying the funding source in the budget is meaningless.

  • 2 E // Feb 4, 2013 at 2:58 pm

    Just throwing it out there…but why have a state employee retirement program at all ?
    Why not pay a competitive salary/wage…and let them rely on personal investments and social security like everyone else ?

  • 3 Chris Tobe // Feb 4, 2013 at 3:52 pm

    E, we could completely eliminate the program and it would not decrease our current liability of $30 to $40 billion one penny. The liability is for pension benefits already earned in the past. These are two very separate issues. The legislature is commingling them to confuse taxpayers and to deflect blame from themselves on destroying the pensions and the financial stability of the state.

  • 4 Conservative Kentuckian // Feb 4, 2013 at 4:09 pm

    I have a cousin who works for the state and he swears he could make more money doing something similar in the private sector, and probably pay less for better health insurance too. He says the state’s major selling points were vacation and sick leave benefits and the pension. He says he’d go back to the private sector in a heartbeat if not for all the years he has invested in his state retirement.

  • 5 E // Feb 4, 2013 at 4:31 pm

    Tobe, I’m thinking more from this point forward.
    Last year my daughter presented a bill at KYA, that said if the KRS was underfunded, that the elected and administrative office holders would have a commensurate percentage of their pensions withheld. As such, if the public pensions were 60% underfunded…the ‘electeds’ would face a 60% withholding on their pension disbursements.

  • 6 Cavemouse // Feb 4, 2013 at 10:10 pm

    E – as noble and wonderful as paying state and municipal employees would be, it will never fly in KY. The bosses and the pubic will not want to pay the government surfs that kind of money. Your daughter’s idea is the best one I have heard so far and the only one that holds the people who put KRS in this mess accountable. She is a very smart young lady!!

  • 7 susan weaver // Feb 4, 2013 at 11:50 pm

    … college-student nervous of tuition increases? a grandmother needing public transit? a small-business owner trying to meet pay-roll? if you just need to get to work on a state road? then you should have some concerns … YES, you should have concerns, because Mr, Thayer, how interesting that your examples are of PUBLIC WORKERS providing those services … UK professors, the transit bus drivers, the small business assistance program, the state road workers … Yes, the public should be worried about how you are working to destroy the public workforce ….. a workforce of regular people who showed up every day to provide honest services that you yourself say the public uses and depends on … Shame on the Legislature!

    “Because every extra dollar needed to pay for pension benefits is a dollar unavailable for another worthy purpose.” I cannot even begin to address the inflammatory nature of this statement. The money stolen from the pension payments in 14 of the last 21 years went somewhere, went allegedly to these other ‘worthy purposes’ year after year because the legislature was too cowardly to take on TAX REFORM to reconcile the failure to generate sufficient revenues to run the state adequately .. relying on accounting gimmicks and political posturing to balance the budget …

    Flee, young people in Kentucky, take your college degree and leave the state, do not for one minute presume the state has anything to offer you as a career … move along nothing to see here … the Legislature is smoke and mirrors and broken promises …