8/30/2017 — Dr. William Barber, Bevin and Beshear in Court, Pension Reform, and Catch Up

The Reverend Robert Christopher Hughes

  • Last week, Rev. William Barber of North Carolina brought his “poor people’s campaign” to Louisville. Dr. Barber spoke at the most recent Democratic National Convention and has been touring the country to take his “moral Mondays” campaign in North Carolina to a national audience. Chris Hughes was there, and will talk about it with us today.
  • What was the main message that Dr. Barber brought to town? What was the audience like?
  • Reports said that the crowd was “small” — is that right, and what do you make of that?
  • You were living in North Carolina while Dr. Barber’s “Moral Mondays” were happening — how did that go, and do you think he can replicate that nationally?


Bevin v. Beshear Update

  • UL Board of Trustees
  • This case was argued at the Supreme Court of Kentucky this week. The attorney general is arguing that Bevin’s board restructuring at UL was unconstitutional.
  • If you’ll remember, Franklin Circuit Judge Shepherd said that Bevin could not abolish the board without a hearing, and Bevin appealed.
  • There’s also an argument that the issue is now moot, as there was legislation passed this year that accounts for replacing the board
  • The 2017 General Assembly ratified Bevin’s reorganization of the UofL board by passing Senate Bill 12. Lawmakers then passed a second law, Senate Bill 170, which sets out conditions for naming or removing trustees at all public universities, including a requirement that trustees appointed by the governor must be confirmed by the Senate.
  • But one of the exceptions to mootness is “capable of repetition, yet evading review”
  • Andy Beshear argued that it’s not only capable of repetition, he IS repeating these kinds of actions over and over (KSR, Worker’s Comp, etc)
  • Education boards
  • The attorney general has also sued Matt Bevin over the reorganization of several education boards. This suit was filed in June of this year, and is Beshear’s fourth suit against Bevin, and the third involving reorganization of boards
  • This is different than the UL case because university boards have a different statute
  • The Kentucky Education Association has joined Beshear in this suit
  • Bevin’s attorney filed a motion to dismiss, which Judge Wingate (Franklin Circuit Court) converted to a motion for summary judgment. The Attorney General’s office has 20 days to respond to the motion.
  • Summary judgment: The party making the motion marshals all the evidence in its favor, compares it to the other side’s evidence, and argues that there are no “triable issues of fact.” Summary judgment is awarded if the undisputed facts and the law make it clear that it would be impossible for the opposing party to prevail if the matter were to proceed to trial.


Bevin Pension Chat

  • PFM Consulting was hired by state to make recommendations regarding Kentucky’s pension crisis. To quickly summarize the pension crisis, we have two major pension systems, Kentucky Retirees System and Teachers Retiree System and basically, there is a major gap in what is paid into the system and what is owed. If you go all the way back to episode 2, you can listen to Robert explain the pension crisis in greater detail.
  • On Monday night, Matt Bevin did a Facebook live video to explain the PFM recommendations and potential changes to the pension systems that may be implemented in a special session. A reminder, special sessions cost taxpayers money.
  • Also remember, right now, these are just recommendations, not legislation, but I think Republicans like these recommendations, so they could become legislation with their super majority in the General Assembly. The recommendations were presented to the Public Pension Oversight Board and to the state budget director, John Chilton, who has said that painful changes are needed.
  • The changes
  • Move all new public workers into a defined employer contribution system like a 401(k) — instead of defined benefits or the hybrid cash balance plan of many new workers since 2014. These plans would require employees to contribute 3 percent of their salary, while the employer would contribute 2 percent of their salary and the state would provide a 50 percent match on the next 6 percent of income the employee contributes.
  • Raise retirement age of current and new workers
  • Remove ability to put unused sick time into pension benefits
  • Eliminating any pension benefit payments for current retirees that resulted from cost of living adjustments granted between 1996–2012. Future COLAs would be suspended for teachers in the KTRS until that plan reached a funding level of 90 percent, while new teachers would now be eligible for Social Security along with a 401(k)-style plan, while no longer having a defined benefit.
  • Workers in hazardous jobs wouldn’t be able to retire after 25 years, but they’d have to wait until age 60 if they didn’t want their benefits significantly cut
  • Employees could also take a buy-out offer
  • Some democrats have suggested the idea of the state issuing pension obligation bonds, but PMF was against this and said it would be too risky. Another idea that was shot down by PMF was making County Retirement Systems independent. PMF said this would create unneccessary administrative costs.Tax reform was also dismissed.
  • Chilton: Without these changes, an extra $1 billion would be needed in the next fiscal year to make the pension contributions, which would mean that the state agencies cuts by 9 percent in the current two-year budget ending next summer would have to be cut by 34.4 percent in the next two-year budget. If the state chose to also cut funding for K-12 education, those other agencies would only be cut by 16 percent.
  • In Bevin’s facebook live video, he said that the government would not pursue all of the recommendations made, but he did praise the report. Also said that any legislation that is passed would not have an emergency clause, so it wouldn’t go into effect immediately and workers could make decisions about their future
  • Who’s mad?
  • Teachers! Bevin kind of blamed them and said that if they retire now to protect their benefits, they shouldn’t be in the classroom
  • JCPS board chairman Chris Brady said that local school districts would have to find the funds needed to set up teachers for Social Security, on top of soon losing funds from new charter schools. The changes would also make it more difficult than it already is to recruit quality teachers.
  • Bevin also led off the chat by talking about an email where a teacher cursed at him
  • But also all state workers! There’s a worry that current state workers could rush to retirement OR file lawsuits based on violating contract they were promised. The report didn’t even address contract rights workers may have.
  • State house meeting about the issue, Jeff Hoover caled for a closed session to prevent grandstanding.

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