September 20, 2018 / 6:55 PM / 3 months ago

Kentucky high court focuses on legislative passage of pension law

Sept 20 (Reuters) - Kentucky’s Supreme Court on Thursday considered whether legislators violated the state constitution when they passed a bill earlier this year aimed at addressing the state’s cash-strapped public retirement system.

In oral arguments that pitted Kentucky’s Democratic attorney general against the Republican governor’s general counsel, questions from the justices suggested the case would be decided on legislative procedures that led to the bill’s passage. There was little discussion about the legality of pension changes approved by lawmakers.

The funded ratio of Kentucky’s retirement system was the lowest among the 50 states at just 31 percent in 2016, according to a Pew state pension funding report. Republican Governor Matt Bevin has warned that two state pension funds will likely become insolvent during the next two decades without cost-saving changes.

Shortly after the governor signed the pension bill into law in April, Attorney General Andy Beshear sued, claiming the measure violated state statutes and constitutional provisions related to public employee contracts and legislative procedures.

Bevin appealed directly to the Supreme Court a June ruling by a Franklin Circuit Court judge that found the law was not validly enacted by the Republican-controlled legislature, but did not address the employee contract claims.

Questions by Supreme Court justices focused on whether lawmakers and the public had time to digest the pension language that was inserted at the end of the 2018 legislative session into a bill originally dealing with local sewers.

The revised bill put future teachers into a less-generous retirement plan and changed various benefits for government workers.

Beshear said the bill was passed by both legislative chambers in a matter of hours, leaving the public in the dark.

“The government that is supposed to be for the people becomes a government that is hidden from the people,” Beshear said.

Bevin’s general counsel, Steve Pitt, argued that the pension language was “almost identical” to legislation introduced earlier in the session. That bill sparked protests by teachers and public workers at the state capitol in Frankfort.

Pitt questioned the court’s ability to review legislative procedures and also warned that voiding the law would open the door to parties seeking to toss out a “countless number” of existing Kentucky laws that were passed using similar procedures.

Bevin went on Twitter on Thursday to defend the law and highlight moves by his administration to increase pension funding.

“Without pension reform, Kentucky’s pension systems will COLLAPSE,” he tweeted. (Reporting by Karen Pierog in Chicago Editing by Matthew Lewis)

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