Friday, January 04, 2008

BIPPS Offers Pension Mess Advice

The bill with the most lasting impact in the 2008 session hasn't been filed yet and may not be filed. That bill will be the one that seriously addresses the $28 billion public employee benefits emergency.

The Bluegrass Institute's Jim Waters jumps on previous politicians for punting the ball on this and offers commonsense actions:

Irresponsible governance created the under-funded crisis in the first place. The system paid the price for self-serving politicians to fund local pork and win the next election instead of properly funding the retirement accounts.

Now lawmakers – particularly House and Senate leaders – must think beyond short-term political gains that come from doing nothing. If they don’t, we’re looking at either a massive tax increase or a bankrupt commonwealth.

The commission offered some worn ideas on how to shore up the under-funded accounts, including the credit-card approach of borrowing money. But it mentioned nothing about lengthening the time state employees must work before drawing cushy benefits or changing the benefits structure for future hires – two areas that legislators absolutely must address.

We didn’t need a commission to recommend a rope-a-dope approach – including more study, yes, more study! – in order to conclude that requiring employees to work only 27 years before they draw a Cadillac benefits package for life creates a bottomless pit of spending.

You can read the whole thing here. This is the problem that is consuming the Beshear administration right now. It should be.