Lexington council member Richard Moloney wants to see more attention given to local employee pension payment obligations over the next five years.
Moloney expressed his concerns during a council budget committee meeting Tuesday. Moloney believes a Kentucky Supreme Court ruling declaring the state’s new public pension law unconstitutional would lead to changes in the state budget.“If the case comes out and it is unconstitutional, it will have an impact on all the budget because all the money’s been spent, they’ll have to go back and redo this budget,” said Moloney.
No matter the outcome at the Kentucky Supreme Court level, Finance Commissioner Bill O-Mara believes local officials can be expected to make consistent payments. “Regardless of how the pension reform legislation goes through the judicial system, we still see our pension bill, our expense going up 12% a year for the foreseeable future,” noted O’Mara.
O’Mara doesn’t think that will change, because that local cost is based on the Kentucky retirement system board’s action on rates based on actuarial assumptions separate from the pension legislation. Oral arguments before the State Supreme Court on the pension law are scheduled for mid-September.