COLUMN: Lawmakers are facing a dilemma on pension reform

COLUMN: Lawmakers are facing a dilemma on pension reform
The Kentucky State Capitol
Gov. Matt Bevin (Source: James Thomas/WAVE 3 News)
Gov. Matt Bevin (Source: James Thomas/WAVE 3 News)

FRANKFORT, KY (CNHI) - Gov. Matt Bevin and his fellow Republicans who control the majorities in both chambers of the General Assembly vowed last fall to enact public pension reform by the end of 2017.

But we're a full month into the 2018 General Assembly and we've yet to see a publicly released pension bill. Now, some have begun asking if there will be one.

House Speaker Pro Tem David Osborne insists the House can and will pass pension reform and is likely to do so in reasonably short order - once lawmakers get the actuarial data from various proposals from the retirement systems.

But there are whispers that the problem isn't a lack of data about the impact of the proposals. Some suggest the problem is what those data show: that the latest versions of a bill crafted in response to criticisms of the original proposal won't save significant money. Or at least enough to justify unpleasant changes to a system on which so many teachers, state workers and retirees rely.

Some previously passionate supporters of pension reform have begun suggesting that current proposals might not save as much money as the existing system which placed new hires into hybrid-cash plans created by the last round of pension reform in 2013. And it's not just Democrats saying it — a few Republicans seem to suddenly doubt lawmakers' willingness to enact meaningful reform.

No one has slipped me any of the analyses. I'm just as much in the dark as anyone. But combined with the long delay and comments by some Republican lawmakers, it sounds like it's not going well.

Bevin and legislative leaders insist pension reform cannot wait because of the looming fiscal crisis the problem presents and its impact on other parts of the state budget. Indeed, the budget proposed by Bevin - just as he predicted - is brutal. It's filled with spending reductions that are not only unpalatable but threaten basic functions of state government such as public education.

So I wasn't entirely surprised when one person suggested it might be better to delay changes until lawmakers can somehow cobble together something that works — and just as importantly something which can pass.

"You're only going to get one bite at the apple. You better do it right the first time," he said. Another said he's not interested "in just rearranging the deck chairs."

Those who say reform can't wait and demand that such reforms make significant changes like those proposed by Bevin tend to blame the controversy in the House over Jeff Hoover's fall from the Speaker's chair and the resulting resentment among Hoover's supporters. And that has played a part. It's also emboldened some Republicans who are skeptical of Bevin's larger agenda and governing style.

But while those issues are complicating factors, they're not the primary reasons meaningful reform may be in danger.

There are two obvious problems. First, there's not enough money to bolster the financial stability of the system without devastating cuts to the most fundamental services of state government. And that means, secondly, somebody has to lose.

To adequately fund the systems, we'll have to underfund our classrooms or ask state police to rely on high-mileage, increasingly unreliable cruisers or endure bigger caseloads for social workers and a hundred other sacrifices.

The only other option is to increase revenues which of course someone has to pay. Finally, any or all of those unpleasant options might cause some lawmakers to lose their seats.

The classic definition of a dilemma is that all the alternatives are bad. That's what lawmakers are facing.

Somebody's got to lose, somebody's got to pay. It's not easy for lawmakers to choose who will.

Ronnie Ellis writes for CNHI News Service and is based in Frankfort. Reach him at rellis@cnhi.com. Follow him on Twitter @cnhifrankfort

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