Possible Special Session - Pension Reform

(May 28, 2008) - Governor Beshear said today that he is proposing that the legislature meet in a special session to address issues with the state pension system. The Governor met this morning with leaders in the House and Senate and proposed a compromise document - a bill that he believes includes the issues that both chambers had agreed to during this past legislative session. The House and Senate have not yet agreed to the Administration's proposal, but Governor Beshear said that he would call for a special session to begin as early as June 23rd, if all sides reach an agreement. In order to reduce the costs to the employee retirement system, the Legislature needs to agree to a proposal before June 30, the end of this fiscal year.

The changes that are included in the Governor's proposal include raising the retirement ages for future employees, lowering the cost of living adjustment to 1.5 percent, requiring new employees to contribute 1 percent of their salary to the health insurance fund, and making changes to the practice known as double-dipping. These changes are said to save the state $500 million annually and city and county governments and school districts at least $50 million immediately.

In addition to proposing a special session, the Governor also appointed a 27 member work group to study the issues that the House and Senate did not agree to during the session. The Attorney General, Secretary of State, Auditor, Treasurer, and Agriculture Commissioner will all take part in this work group. Business groups, union heads, actuaries, administration officials, and two members each picked by Senate President David Williams and House Speaker Jody Richards will also participate.

When asked if he is considering expanding the call of the special session beyond the pension issue, the Governor said he preferred not to do that. However, he did not specifically say that he wouldn't expand the call. Special, or extraordinary, sessions can only be called through an executive order form the Governor and are limited to only those issues specified in the executive order. The Governor can amend the call at any time.

Governor Beshear's Press Release

More details to follow...