Accountability Kentucky Pensions Teachers

Good News: Kentucky Supreme Court Strikes Down Pension Bill That Provoked Teacher Protests

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If you recall, thousands of Kentucky teachers walked out last spring and rallied at the State Capitol to protest Governor Matt Bevin’s pension plan, which bottom line eliminated defined benefit pensions for new teachers.

That bill passed in the middle of the night, tucked into a sewer bill.

The Kentucky Supreme Court just struck it down.

See here.

The Kentucky Supreme Court on Thursday struck down a law that made changes to one of the country’s worst-funded public pension systems, a victory for teachers who shut down schools across the state to protest the law earlier this year.

Democratic Attorney General Andy Beshear, who filed the lawsuit that led to Thursday’s ruling, called it “a landmark win for all of our public servants.” But Republican Gov. Matt Bevin called it “an unprecedented power grab by activist judges.

“This will destroy the financial condition of Kentucky,” Bevin said, a claim Beshear dismissed as “fear mongering.”

Public pension systems across the country are in trouble as workers live longer and states grapple to make up investment losses from the Great Recession. But Kentucky’s pension systems are considered the worst of the worst, with the state at least $38 billion short of the money it needs to pay benefits over the next three decades. The shortfall has required state lawmakers to divert billions of dollars in state money to the pension system, leaving little else for other services like education and health care.

In April, Gov. Bevin signed a law that moved all new teacher hires into a hybrid pension plan. The law also restricted how teachers used sick days to calculate their retirement benefits and changed how the state pays off its pension debt.

Facing a tight deadline, state lawmakers introduced and passed the bill in one day near the end of the 2018 legislative session. The bill moved so quickly that a copy was not available for the public to read until the day after lawmakers had voted on it.

Teachers were outraged, thousands marched on the Capitol and schools in more than 30 districts closed. Beshear sued, arguing the legislature violated the state Constitution by not voting on the proposal three times over three separate days. Bevin argued lawmakers did not need to do that because they had substituted the bill for an unrelated one that already had the required votes.

Thursday, the state’s highest court sided with Beshear. It ruled that lawmakers cannot take a bill close to final passage and replace it with an unrelated bill without voting on it three times over three separate days as the Constitution requires.

The ruling could have political consequences. Bevin is up for re-election in 2019, and Beshear is one of the Democratic candidates vying to replace him. The two men have clashed in court multiple times since 2015.

PBS ran a program called “The Pension Gamble” about how Kentucky politicians used the pension fund as a piggy bank for their pet projects, taking it from solvent to insolvent. Teachers should not have to pay for politicians’ profligate behavior.

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