Welcome to the latest edition of This Week in Pensions! We have gathered the best stories about pensions and retirement security from the previous week. This is the news you need to know in the fight for a secure retirement.
Kansas’ public pensions need to be protected | Commentary by Sarah Lafrenz. Sarah LaFrenz, the President of the Kansas Organization of State Employees (KOSE) and a member of Keeping the Kansas Promise (KKP), wrote an op-ed published in the Wichita Eagle. LaFrenz argues that state lawmakers should stay vigilant in protecting the progress that has been made with the Kansas Public Employee Retirement System since the reforms of 2013. She also urges lawmakers to fully fund KPERS and find ways to improve KPERS Tier 3, which is a cash balance plan provided to public employees hired after January 1, 2015. “Public pensions are a promise. They are a promise to the hard-working public employees across Kansas who dedicate their lives to serving our communities. This includes correctional officers, teachers, firefighters, police officers, municipal workers, and all other public employees,” wrote LaFrenz. “Pensions are a great tool to recruit and retain the best employees and have an outsized positive impact on our state and local economies.”
House Republicans and Gov. Beshear each filed a budget plan. How are they different? by Austin Horn. This week, Democrat Governor Andy Beshear presented his budget blueprint to the legislature. What’s a-typical of the process is that House Republicans introduced and passed House Bill 1, their budget bill. While this is a display of the tensions between the Governor and state lawmakers, it is important to note that both parties can come to a consensus on investing in their pension systems.
Both proposals make contributions to the state’s largest systems, with $860 million this year and next going into the Kentucky Teachers’ Retirement System and the Kentucky Retirement System receiving its full actuarial required contribution. In Governor Beshear’s version, another $750 million over the next two years will go towards paying down the state’s unfunded liability. The Republicans’ bill would put $415 million towards the unfunded liability of the Kentucky Kentucky State Police Retirement Fund and the Kentucky Employee Retirement System (KERS) Non-hazardous pension fund. Funding discipline is vital to improving the fiscal health of pension systems and Kentucky lawmakers are taking the right steps to ensure that happens.
Attracting, hiring qualified teachers becomes more difficult for Illinois school districts by Andrew Adams. Recruiting and retaining employees has dominated headlines across the country. In Western Illinois, schools in the area are having trouble getting qualified applicants and keeping them. One school superintendent, Matt Plater, describes it as “the worst it’s ever been.”
In addition to licensing standards the state implements and the reputation that educators are not respected, some cite the changes to the pension system in 2011 as an issue. Those changes mean teachers have to work longer for a decreased benefit. Coupled with a system that is chronically criticized for its current funding levels, applicants are looking elsewhere. It’s important to note that Illinois does offer teachers a defined-benefit plan and to not be deterred by opponents attacking the system’s unfunded liability, as efforts have been made to practice fiscal discipline and make the appropriate payments into the system.
Be sure to check back in next Friday for the latest news in the fight for a secure retirement!