The Latest: Kentucky Senate OKs pension bill, heads to House
FRANKFORT, Ky. (AP) — The Latest on a pension bill before the Kentucky legislature (all times local):
The Kentucky Senate has passed a bill that would let some agencies leave the state’s beleaguered pension system.
The Senate approved House bill 358 by a vote of 25-12 on Wednesday. The bill would let some public universities and quasi-governmental entities leave the pension system without paying what they owe. State officials said it could cost the beleaguered system as much as $1 billion.
Republican Sen. Chris McDaniel acknowledged the bill will add to the pension system’s woes. But he warned agencies would likely file for bankruptcy if the bill did not pass because they cannot afford increased pension contributions.
The bill now heads to the House of Representatives, where Republican Speaker David Osborne said it will likely pass.
Kentucky lawmakers could approve a bill that would make one of the country’s worst-funded public pension systems even worse.
House bill 358 would let about 118 quasi-governmental entities leave the struggling pension system without paying what they owe. An analysis by the retirement system said it could cost the beleaguered system as much as $1 billion.
Republican Sen. Chris McDaniel calls it the best of the worst options. He said these agencies can’t afford to make increased pension contributions for their employees. Department of Public Health Commissioner Jeffrey Howard said 63 public health departments would have to close over the next two years without changes.
Some retirees are worried the changes would put their financial future in peril by weakening the system.