August 28, 2018 10:27am
GLI joins amicus brief in support of pension reform
With the Kentucky Supreme Court scheduled to begin deliberations on the fate of Senate Bill 151—the pension reform bill passed by the legislature in the 2018 session—GLI joined business groups from throughout the state to make the case for pension reform and keeping the law on the books.
GLI, the Kentucky Chamber of Commerce, the Northern Kentucky Chamber of Commerce, and Commerce Lexington, Inc. stated in an amicus brief that “SB 151 is a positive step to help the Commonwealth create a prosperous economy, in which the state is able to make essential investments in education and infrastructure.”
Unfortunately, the Kentucky Supreme Court decided not to accept briefs from third parties on the matter. However, GLI and our partners are proud to have once again voiced our support for pension reform.
SB 151 was passed late in the 2018 session and introduced into Kentucky’s ailing public pension system several important reforms, including key GLI priorities such as level-dollar amortization for paying off unfunded liabilities and a cap on factoring sick days into retirement benefits. In addition, by introducing hybrid cash-balance plans into the TRS system, Senate Bill 151 lowers risks for taxpayers and provides educators with a sustainable retirement package. Shortly after its passage, credit rating agencies immediately commented on the legislation’s promise, calling SB 151 “credit positive for the Commonwealth, local governments and public universities.”
Following a legal challenge to SB 151 on procedural and substantive grounds, the Franklin Circuit Court ruled the bill unconstitutional, citing the manner in which the bill passed through the General Assembly. Earlier this month, the Bevin administration appealed the ruling and requested an expedited appeals process to allow the case to go directly to the Commonwealth’s highest court. Oral arguments before the State Supreme Court are scheduled to take place on September 20.
The brief signed onto by GLI focused not on the procedural issues ruled on by the Franklin Circuit Court but rather on the necessity of pension reform for the future of the Commonwealth’s economy and fiscal stability as well as the legal validity of the reforms enacted by SB 151. The full brief can be read here.
Pension reform has long been a key priority for GLI. We have published op-eds, written letters, discussed, debated, and proposed solutions, and lobbied policymakers directly in order to save our public pension system and put our state on a more secure financial footing. Without reforms, Kentucky will continue to be at a severe disadvantage when it comes to job creation and talent attraction and our public education system and infrastructure will continue to go underfunded. We need reform, and our hope is that the Court will consider the arguments put forth by Kentucky businesses in this brief.