FRANKFORT, Ky. (KT) - An exchange of letters this week between Gov. Matt Bevin and state lawmakers has failed to break the impasse in finding a solution to solving the pension problems of the state’s regional universities and 118 quasi-governmental organizations.
Those agencies face a near doubling of their pension costs July 1 if no action is taken, which could cause some of them to make severe cutbacks or even shutdown.
After the governor sent a letter Monday to all 138 lawmakers urging passage of his plan, House Democrats responded later in the day by sending their own letter to Gov. Bevin and Deputy Chief of Staff Bryan Sunderland.
“Our caucus shares the same beliefs with many of our Republican colleagues that the governor’s plan is too risky and could be more harmful than helpful to both taxpayers and thousands of public employees and retirees,” the letter read.
The Democrats said they would make themselves available to further discuss their concerns and share ideas that could lead to a permanent solution that could result in transparent, bipartisan and financially sound legislation.
“For this process to work, the General Assembly first needs to be called in to enact a one-year rate freeze for the affected agencies and regional universities. This freeze has near-universal agreement, including in all the plans from the Governor’s office, and would lay the foundation for a plan that is more beneficial to taxpayers, the affected agencies and the public employees who provide critical and essential services Kentuckians need,” the letter concluded.
Bevin responded on Wednesday saying, “Your letter sadly offers no solutions to allay the concerns of our citizens who stand to lose needed services at the local level. It does nothing to mitigate the impending job loss in your members’ districts. Furthermore, your proposal would intentionally do more financial damage to the nation’s worst funded pension system, while not including a single thing to protect it. Your best ‘idea’ is simply to kick the can of financial responsibility down the road…again.”
The governor further noted that freezing the rates for another year would underfund the pension system by $121 million, on top of the $132 million this year, when lawmakers enacted a one-year freeze.
Bevin said he called House Minority Leader Rocky Adkins, D-Sandy Hook, last week to discuss additional changes proposal by House and Senate members.
“My team and I have been available every day of the week to discuss the proposal, but I have never heard from any of you,” he said of Adkins. “Not a peep of constructive input or a single responsible idea. And then your silly letter arrived this week proposing to kick the can again.”
The governor also said the plan he presented mirrors pension buy-out language in 2015 and 2018 legislation “that every single one of you have supported and voted for. Why not support this again for the thousands of your constituents who need your help?”
The Democrats responded later in the day repeating their invitation for Bevin to meet with them. “This meeting, which should be open to the press, can be arranged quickly and, contrary to your claim, is not tied to first calling a special legislative session. We had no role in writing the legislation, but it is clear there is not enough support for it. We can and must come together to find a better way as the fiscal year comes to a close.”
The House Democrats said, “Our caucus stands ready to protect vital services offered by domestic violence shelters, rape crisis centers, public health departments, regional universities and other quasi-governmental agencies. Our commitment extends to their employees, retirees, and the Kentucky taxpayers who rightfully expect these services to continue. We hope you accept our offer to address our caucus and avoid this crisis.”
When asked for comment on the most recent letter from House Democrats, the Governor’s Communications office said the governor’s latest letter speaks for itself.
While Republicans hold a super majority in both the House and Senate, there apparently is not enough support within Bevin’s own party to pass the plan or it would already would have been approved.