Special session wraps up as Beshear signs pension legislation

Gov. Steve BeshearThe special session in the Kentucky state legislature seems to have passed without a hitch, as Governor Steve Beshear (D-Lexington) signed pension reform legislation this afternoon, ending five days of overtime for state legislators in Frankfort.

"The quick action by House and Senate leadership has brought about the intended results I outlined when I first challenged the General Assembly on May 29 to act on this issue," said Beshear, in a statement released after he signed the bill.

The pension legislation sailed through the state legislature during the session, passing the Democratically-controlled House 98-0 on Wednesday and the Republican-controlled Senate today, 35-1.

The success was essentially predetermined, given conditions outlined by Beshear to move the special session into fruition.

With no movement on pension reform during the regular legislative session - which ended in mid-April - Beshear and House and Senate leadership worked out a compromise draft on the issue late May and early June that clearly met the approval of almost all legislators in Frankfort.

Once a compromise was met, Beshear called this week's five day special session specifically for the pension issue.

"We face a financial catastrophe - one that demands significant, immediate action," Beshear told legislators during his address to a joint legislative session in Frankfort on Monday.

With all sides acknowledging flaws in the extant pension system, the bill passed today does make some significant changes. New state employees will have their retirement age bumped up and be required to contribute 1 percent of their earnings to retirement health plans. The approved bill also trims cost-of-living adjustments to pensions from a maximum of 5 percent down to 1.5 percent.

The legislation, however, excludes the more problematic provisions that initially stalled the bill during the regular session.

For these provisions, Beshear assembled a "working group" charged with the task of giving the Governor policy recommendations by November 1.

"The work we face in coming months does not negate the success of what we, together, have accomplished this week," said Beshear, acknowledging that questions remain on pensions.

In one report on the bill's passage, Senate President Pro Tem Katie Stine (R-Southgate) said today's bill was not a complete solution, telling the Kentucky Enquirer that in the coming decades "our unfunded liability will be even greater than it is now."

"This is why it is important to keep reforming the system so that it will eventually be more in line with what is available in the private sector and be sustainable," said Stine, according to the Enquirer's Pat Crowley.

For the Governor, the passage of the reform package today offers him a degree of success in a year when legislative struggles have been the norm. Beshear's proposed casino gaming amendment failed to find a vote on the House floor during the regular session, while his proposed substantial hike in the tobacco tax did not become law.

During Monday's joint address, Beshear said a win on pension reform could pave the way for future progress on his policy intiatives and cooperation between the divided government in Frankfort.

"A quick and successful special session can signal the beginning of a new era in Frankfort, one where cooperation on critical public policy is the norm and where politics and partisanship are reserved for campaigns," said Beshear on Monday.

In today's statement, Beshear extrapolated that point to the present.

"The passage of House Bill 1 required cooperation that transcended party lines, legislative chambers and the separate branches of government. It required respect, open dialogue and a focus on the public good, not partisan politics," said Beshear.