Public Pensions, Illinois versus Kentucky: A Race to Fiscal Chaos
A commentary by Joe Brennan
I was recently struck by a article appearing in an electronic news release in the New York Times:"Pensions Fix Struck Down, Illinois Again Faces Budget Crisis", by Monica Davey. This might not apply to Kentucky's pension system, we don't even have a " legislative "fix" that could be challenged in our state Supreme Court. The article is however, fit for Kentucky reading and reflection. The Illinois Supreme Court unanimously rejected their state's legislative approach to " the fix" created a year and a half ago.
The Times article noted that the pension overhaul violated the Illinois Constitution because benefits promised, "shall not be diminished or impaired". Apparently, the Illinois public pension fund has been underfunded by one hundred billion dollars. The 2013 "fix" was supposed to have saved the state one hundred and sixty billion dollars over thirty years all paid for through the state's pension fund. Justice LLoyd A. Karnier wrote in his opinion that, "It is a crisis for which the General Assembly itself is largely responsible".
Kentucky's pension system is not as severe as Illinois, we are 49 th. We are not "Bonded" to fix our pension system, but let's correct it. Despite unsuccessful attempts to address our un/ and underfunded system, the day may shortly come to confront our existing financial crisis. Does KY's Constitution present the same laws to fulfill its obligations to its public servants? Will it take a KY Supreme Court decision to obligate the General Assembly to "fix" our system? When will our crisis be confronted?