Kansas public employees are facing a bill that would move future public employees hired after July 1, 2024, into a thrift-savings plan and strip them from access to a pension through the Kansas Public Employees Retirement System (KPERS). This includes some police officers, all correctional officers in the state, teachers, and other public employees. A thrift-savings plan is just another way to say a defined-contribution retirement plan. SB 553, which was rushed and passed out of committee by Senator Caryn Tyson, would also require public employees to contribute one percent of their pay to a deferred compensation plan, increasing a percent each year automatically until it reaches ten percent — unless public employees opt-out.
We’ve discussed the downfalls of moving public employees from a defined-benefit pension plan to a defined-contribution retirement plan before. We’ve released videos and created one-pagers – this is a haphazard decision that will hurt the retirement security of public employees and cost Kansas taxpayers more in the long run.
As the author of the bill, Senator Tyson decided that it would be best to have the bill heard by the committee she chairs, the Senate Assessment and Taxation Committee, instead of the standard pension committee, the Senate Financial Institutions and Insurance Committee. Additionally, when crafting this legislation, the Senator did not include input from representatives of the public employees this would impact. Instead, she has decided to rush a committee hearing over two days, failing to provide a single model of what a public employees’ retirement would look like if they are moved to the thrift-savings plan.
This morning, The Reason Foundation’s Pension Integrity Project, which we’ve covered before, testified in favor of the legislation. As we’ve said before, their analysis should not be trusted.
In Kansas and across the country, state agencies, school districts, and local governments are struggling to recruit and retain public employees. So much so that Alaska and Oklahoma are looking at re-opening their closed pension plans to try to stem their loss of public employees. Recruitment and retention are struggling in Kansas, closing a pension plan to future hires is not such a great idea. The state could also face long-term cost implications as several other states that have made this type of move have faced.
Keeping the Kansas Promise (KKP), NPPC’s coalition in the state is working hard to educate lawmakers on the negative effects this legislation will have on current and future public employees as well as taxpayers. KKP continues to stay diligent in its work to make sure that SB 553 is defeated this legislative session.