FRANKFORT, Ky. (AP) — While the state struggles with a $1 billion shortfall, the retirement plan for legislators is set to increase by more than $3.5 million in the next budget, according to a report.
The total for pensions for state lawmakers will increase from $759,158 in the current budget to $4.28 million over the next two years because of a benefit enhancement quietly voted into law four years ago.
The totals come from a recently released actuarial report for the Kentucky Legislators Retirement Plan.
That report says almost half of the $4.28 million will be used to pay for a controversial enhancement that applies to fewer than 30 current and retired legislators.
"I think there are a number of legislators offended by (the enhancement), and I'm hopeful that will create some momentum to make some necessary changes," said Sen. Damon Thayer, R-Georgetown.
The Legislators Retirement Plan has 336 members and beneficiaries and $43 million in assets. The state employee pension plan, by comparison, has almost 91,000 members and beneficiaries and $5 billion in assets.
In 2005 the General Assembly changed state law to allow legislators who take state jobs to use their higher, non-legislative state salaries to calculate their legislative pensions.
The retirement perk has become more controversial in recent months as Gov. Steve Beshear, a Democrat, lured two GOP senators out of the Republican-controlled legislature with high-salary appointments that will greatly boost their pensions.
The enhancement was added by the Senate to a House bill that dealt with changes to the state employees' retirement system. Thayer, who was chairman of the Senate committee that heard the bill, acknowledged voting for it.
"At the time I did not know it would open up a loophole for a governor to take advantage of it in a partisan attempt to take over the state Senate," he said.
The appointment of former Senate Majority Leader Dan Kelly, R-Springfield, to circuit judge will boost his legislative pension by at least $35,700 a year, to roughly $64,500, assuming he serves as judge for at least three years.
The appointment of former Sen. Charlie Borders, R-Russell, to the Public Service Commission will boost his legislative pension by at least $37,500 a year, assuming he serves at the PSC for at least three years. He'll also be eligible for a second pension through the Kentucky Employees' Retirement System.
Both Kelly and Borders said their decision to accept the appointments wasn't because of the boost in pay and benefits.
Other current and former legislators who will be able to apply non-legislative salaries to their legislative pensions include House Speaker Greg Stumbo, D-Prestonsburg, who will be able to use his salary as attorney general; Rep. Harry Moberly, D-Richmond, who will be able to use his salary as an Eastern Kentucky University vice president; and former Rep. J.R. Gray, D-Benton, who will be able to use his salary as secretary of Beshear's Labor Cabinet.
Stumbo was out of town and unavailable for comment, his spokesman, Brian Wilkerson, said.
But Wilkerson noted that Stumbo was serving as attorney general and not in the legislature when it approved the benefit enhancement in 2005.
Moberly and Gray could not be reached for comment.
Beshear has said that both Kelly and Borders were qualified for the appointments and that politics did not play a role in his decisions.
Rep. Mike Cherry, D-Princeton, who was chairman of the committee that heard the bill in the House, said he voted against the measure that contained the enhancement in 2005. He said he supports eliminating it.
"A few members can make a large change in our costs, which we are seeing right now," he said. "I think we will look at legislation concerning this issue."
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