Though a number of states and localities have pension funds with funding troubles, the worst is Kentucky’s. The plan has assets equal to only 19% of its estimated liabilities. Even worse is that the administration of the pension fund is dysfunctional and possibly corrupt. There also is a lot of political maneuvering related to the fund. This article summarizes some of the history and the latest events.
The KRS board oversees $16 billion in assets for the retirement benefits of about 350,000 people employed by state or local governments or the Kentucky State Police. It faces billions of dollars in unfunded liabilities, due largely to the failure of state government to contribute recommended sums over most of the last two decades. At Bevin’s urging, an audit of the state pension system is set to begin in coming months.
A state retiree watchdog group immediately blasted Bevin’s order on Friday. It called for the previous trustees to sue the governor.
“The governor has granted himself extraordinary new powers over a board that is supposed to be insulated from political interference,” said Jim Carroll of Kentucky Government Retirees. “Moreover, his actions further marginalize the elected representation of Kentucky Retirement Systems members by stacking the KRS board of trustees with more appointees. We urge the legitimate KRS board to litigate this matter. We as stakeholders deserve nothing less.”