Chamber blog: Pension liabilities crushing cities; top mayors urge action

By Kentucky Chamber of Commerce

FRANKFORT, Ky. (Jan. 9, 2013) — Louisville Mayor Greg Fischer and Lexington Mayor Jim Gray were joined at a press conference Monday by the head of the Kentucky League of Cities and the president of the Kentucky Association of Counties to implore legislators to pass pension reform during this legislative session.

Fischer gave examples of how the unfunded pension liability is consuming Kentucky’s largest city’s budget. Gray was more pointed in his comments. In a reference to the unsustainable pension problem, Gray said, “If there was ever a going out of business model, this is it.”

Gray and Fischer also were joined by a number of mayors from across the state to urge lawmakers to take action during the upcoming short session.

Also in attendance were representatives from the Pew Center on the States, a national think tank that has been helping the legislative task force on pensions. They are expected to release a report next week detailing how bad the problem has grown and the impact on local governments and communities.

Senate Majority Leader Damon Thayer, R-Georgetown, and former Rep. Mike Cherry led a task force this past summer on the issue. Those recommendations will be presented as legislation this session, and there is support from both Democrats and Republicans to address this issue.

The Kentucky Chamber of Commerce has been fighting the pension battle for years, insisting that Kentucky’s economic prosperity is in danger as bond rating agencies continue to downgrade the commonwealth’s rating. But businesses aren’t the only ones suffering.

City and county budgets cannot sustain the increasing portion of costs required to fund public employee pensions. Officials urged the legislature to continue the bi-partisan effort of the pension task force and implement responsible reform efforts to fix this problem during the 2013 legislative session. This is the top legislative issue for 2013 for the Kentucky Chamber, as well as organizations such as the Kentucky League of Cities.

To learn more about issues the Chamber is focusing on, click here.