The $3.3 billion bonding bill to bail out the state’s ailing teachers retirement fund is dead.
Senate President Robert Stivers on Tuesday stripped the bonding provision from the bill, saying that more time needed to be spent studying and fixing the system before any money was added to the Kentucky Teacher Retirement System.
“There are systemic changes that need to be made in KTRS before we can make it actuarially sound and viable in perpetuity,” Stivers said during a floor speech on Tuesday.
Now if enacted, the bill would set up a committee of lawmakers and hire an independent think tank to study KTRS’ predicament and potential solutions.
The teacher’s pension system only has 53 percent of the money it needs to make future payouts to about 141,000 retired teachers. Earlier this year, KTRS officials said that if the the bonds isn’t issued, the state’s required contributions to the system will double by 2026.
“I just think we’re kicking the can down the road, we’re at historic low interest rates that are available to us,” said Sen. Dorsey, Ridley, a Henderson Democrat. “I think we’re missing an opportunity.”
House Speaker Greg Stumbo, a Prestonsburg Democrat, was noticeably noncritical of Stivers’ decision to remove bonding from the bill. But he still emphasized the need to take advantage of low interest rates on bonding.
“That’s not a bad plan but we just can’t let it go too long where we lose this opportunity to bond to see if we’re going to use bonds,” Stumbo said.
Local Option Sales Tax
After garnering a two-thirds majority vote in the state House, it looks like the local option sales tax bill isn’t going to even get a committee hearing in the Senate.
The bill’s likely death is due to interests seeking exemptions from the potential 1 percent increase in the sales tax. Industrial consumers and the horse industry had requested carve-outs, depriving counties and municipalities of some potential revenue sources.
“It’s going to take a renewed effort by the proponents to educate people,” said Stivers, who has tentatively supported the bill.
Stivers also blamed the weather.
Stivers said the weather also disrupted support for legislation that would allow the state to engage in public-private partnerships. But the larger issue is that the bill would allow a toll project on a prospective project to reconstruct the crumbling Brent-Spence Bridge between Covington and Cincinnati.
“There doesn’t appear to be the desire to deal with P3s,” Stivers said.
Tolling the bridge is unpopular with many Northern Kentucky lawmakers.
A bill that banned such a project passed the House and Senate last year but was vetoed by Governor Beshear.
Transgender Bathroom Bill
A bill that would require students to use the bathroom designated for the sex they were born with is a non-starter in the Democratically-led House.
Supporters of the bill say it would protect the privacy rights of students who are uncomfortable sharing bathrooms with transgender students. Transgender students would be permitted to use bathrooms of their birth sex or a private bathroom.
House Speaker Greg Stumbo said the bill hasn’t gained support in his chamber.
“We just don’t feel like it’s that weighty of a subject,” Stumbo said.
The bill passed out of the Senate 27-9.