By Jacqueline Pitts
As Kentucky continues to struggle with pension costs, a bill has been pre-filed to change the Kentucky Teachers’ Retirement System (KTRS) for future teachers to put them in a new plan to help the plan long term.
Rep. Ed Massey filed the bill on Friday after months of work and discussions with fellow legislators as well as education groups including the Kentucky Education Association (KEA), Kentucky Association of School Boards (KSBA), Kentucky Association of Superintendents, and more to come to a compromise.
Massey said as someone who has been involved with education for many years and has many family members that are teachers, it has been critical for him throughout this process to come up with a plan that protects teachers moving forward.
“There were some very big scars left from what happened a couple of years ago,” Massey said on previous attempts to make changes to the teachers’ pension plan. “When I came to the legislature, the first committee I asked to serve on was the House Education Committee and the reason for that was my background in education, my parents are educators, all three of my daughters are in education, and I served on the Boone County School Board for 22 years, was president of KSBA, was president of NSBA. So I consider myself very friendly, very pro-public education.”
The bill applies to new members of KTRS (both university and non-university) hired on or after January 1, 2022, and replaces the current defined benefit plan with a hybrid plan consisting of a defined benefit “foundational benefit” coupled with a smaller defined contribution “supplemental benefit.”
A stabilization reserve account is also established under the bill that is funded by contributions that would be used if the new plan falls below 90 percent funded. Teachers would be eligible for retirement at age 55 with 10 years of service or age 65 with 5 years of service as well as enhanced benefit incentives for those that work past the age of 55 and for more than 33 years.
While pension reform has been a contentious one for many years, Massey said he believes this new approach and consensus will help move the bill over the finish line and ensure more stability in the future.
“I don’t want this to become a political battle. I don’t want to draw political lines. All I see is there is a problem and we need to find a solution. And this is the step towards that solution,” Massey said.