Gov. Andy Beshear’s budget plan would result in Kentucky Retirement Systems getting tens of millions of dollars less in pension contributions than it had expected during each of the next two fiscal years, aggravating the state pension system’s $14.2 billion unfunded liability, KRS officials told lawmakers Thursday.
KRS Executive Director David Eager put the shortfall at $83 million a year in his public testimony. Later, the governor’s office challenged that estimate and said the correct shortfall would be $25 million a year.
Senate Majority Leader Damon Thayer, R-Georgetown, said lawmakers will study this part of the governor’s budget plan in coming days.
“This is obviously something we’ll have to look at,” Thayer said. “We don’t want to accidentally under-fund the pensions.”
Beshear’s budget would cap at 67 percent of payroll the Fiscal Year 2021-22 pension contribution rates for regional universities and dozens of agencies that provide public services on state contract, such as local health departments and regional mental health nonprofits. Their pension contribution rates were scheduled to explode from a previously capped 49 percent to the 93 percent that state government will be paying.
Read the whole article in the Lexington Herald-Leader.
This article quotes selections from “Beshear’s budget would mean tens of millions less than expected for KY pension fund” by John Cheves in the Lexington Herald-Leader.