AN ACT relating to retirement plans covering legislators.
The proposed legislation will alter the retirement landscape for new legislators, compelling them to follow the guidelines set for nonhazardous employees under the KERS. This essential shift aims to mitigate the fiscal liabilities tied to the existing plan, which has been under scrutiny due to its unfunded actuarial accrued liabilities. Additionally, the integration into KERS is expected to provide new legislators with more stable retirement benefits while also potentially reducing costs for the state in the long term.
House Bill 114 proposes significant changes to the retirement plans for legislators in Kentucky, primarily aiming to close the existing Legislators' Retirement Plan to new members effective July 1, 2023. Instead, future legislators would be required to participate in the Kentucky Employees Retirement System (KERS), thus standardizing retirement benefits across various public service roles. This change reflects a shift toward streamlining retirement benefits while addressing funding concerns associated with the current system.
General sentiment around HB114 appears to be cautiously supportive from financial oversight perspectives, as many view the bill as a prudent measure aimed at ensuring legislative retirement systems are more sustainable. However, some legislators express concern regarding the reduced benefits for future members, highlighting a potential disincentive for public service among new candidates. The discussions reflect a balancing act between fiscal responsibility and the need to attract quality candidates to the General Assembly.
Notable points of contention arise from discussions around the rights of current and future members, especially concerning accrued benefits under the current plan. Some existing legislators worry that the proposed changes may lead to a diminishment of their previously promised benefits, while proponents emphasize the necessity of reform to safeguard the overall health of public retirement systems in Kentucky. The bill's ability to pass may hinge on addressing these concerns adequately, ensuring that both current and future legislators are adequately considered.