KY Policy Blog

Decline of Private Sector Defined Benefit Plans No Model for Public Plans

By Jason Bailey
September 20, 2017

Calls to end Kentucky’s defined benefit (DB) public pension plans often refer to the move away from DB plans in the private sector and suggest the public sector should follow suit and become more “modern.” But along with the harm to private employees that has accompanied this trend, industry and government are apples and oranges when it comes to pensions. The decline in private sector plans results from increased regulation as well as economic changes and other differences that do not apply to public sector plans.

Decline hasn’t spread to read more

Cassidy-Graham Bill is Latest Attempt to Unravel Kentucky’s Health Care Gains

By Dustin Pugel
September 15, 2017

The latest attempt to repeal the Affordable Care Act (ACA), known as the Cassidy-Graham bill, would cut Kentucky’s funding for low-income health care by $3.1 billion by 2026. That would be the 8th largest cut in the country, even though Kentucky ranks only 26th in the size of its population.

The bill would undermine health care coverage for millions of Americans in three main ways.

A block grant that squeezes funding for 10 years and then runs out

Perhaps the most devastating of the bill’s cuts would result from turning read more

Small Tax Breaks’ Costs Add Up Over Time

By Pam Thomas
September 8, 2017

Cleaning up expensive tax breaks is essential if we are going to invest in a stronger Kentucky and restore funding to our pension systems. The biennial Tax Expenditure Analysis (i.e. tax break analysis) published by the Office of State Budget Director provides insight into how much we are spending and on what. According to that analysis, our current tax code provides more exemptions than it collects in revenues.  There are so many that the document is 154 pages in length and lists 269 separate tax breaks valued at over $13 read more

Proposed 401ks Cost More Than Kentucky’s Existing Pension Plans

By Jason Bailey
September 6, 2017

The 401k-type defined contribution (DC) plans proposed by PFM in their final report would cost more than Kentucky’s existing defined benefit (DB) plans, according to data from PFM itself and the systems’ actuaries. Under a switch, the state would be making bigger contributions for a plan that reduces the retirement security of its workers. That hardly makes it a solution to the state’s pension funding challenges.

The cost of the DC plan is higher in part because the existing pension plan for new employees is already inexpensive if funded on read more

Lack of Jobs and Wage Growth Still Hurts Kentuckians this Labor Day

By Anna Baumann
September 1, 2017

Labor Day is a good time to reflect on the state of working Kentucky. This year, as the economy continues a long recovery and state and federal decision makers debate policies that could impact progress, it is important to acknowledge we are not yet in a full employment economy that substantially improves Kentuckians’ standard of living.

We have a long way to go to full employment.

The most recent monthly jobs update from the Bureau of Labor Statistics (BLS) shows jobs are continuing to grow steadily in Kentucky as they read more

Four New Ways Kentuckians Could Lose Medicaid

By Dustin Pugel
August 30, 2017

Low-income and disabled Kentuckians are currently eligible for a broad range of health care benefits thanks to Medicaid. As long as people earn below a certain annual wage ($16,670 for adult individuals), or have certain disability-related needs, they qualify. But Kentucky’s recent request to the federal government to make changes to our Medicaid program (known as an 1115 waiver) would add four new ways for people to lose coverage. The documentation attached to the waiver request estimates these new barriers will be a main driver behind 96,687 fewer people being read more

Clawback of Cost of Living Adjustments Would Be Major Hit to Retiree Checks

By Jason Bailey
August 30, 2017

The Bevin administration’s consultant recommends a massive cut to many retirees’ incomes by rolling back past cost of living adjustments (COLAs) — a proposal that could reduce pension checks by as much as 32 percent.

The plan in PFM’s report would claw back COLAs earned between 1996 and 2012 for those receiving pensions in all of the plans, including state and local workers, teachers and police.  For Kentucky Retirement Systems (KRS) retirees, that means their checks could be as much as 32 percent smaller for those who retired before 1996 read more

PFM Report Uses Exaggerated Claims to Justify Harsh, Counterproductive Cuts

By Jason Bailey
August 28, 2017

The final report from the state’s pension consultant PFM uses exaggerated claims about the condition of all of the state’s pension plans to justify harsh and ultimately counterproductive cuts to retirees, current workers and future employees.

PFM bases its recommendations on claims that existing actuarial assumptions must be altered immediately and dramatically for all of the state’s pension plans. Those changes add $1.8 billion to employer contributions in 2019 above what they would otherwise be.  But while the depleted state of the Kentucky Employees Retirement System (KERS) non-hazardous plan merits read more

Pell Grant Cuts Would Reduce College Access and Economic Opportunity in Kentucky

By Ashley Spalding
August 25, 2017

The recent U.S. House budget resolution would slash the Pell Grant program by $75 billion over the next decade, cutting the maximum grant by $1,060 or 18 percent. Pell Grants help expand college access and economic opportunity in Kentucky, and cuts to the program would be incredibly harmful.

Pell Increases College Access in Kentucky

Pell provides need-based grants to undergraduate students who haven’t yet earned a bachelor’s degree; unlike loans, students don’t need to repay them. For the 2017-2018 school year the maximum amount for a Pell Grant is $5,920. read more

Five Things to Keep in Mind as College Students Head Back to School

By Ashley Spalding
August 23, 2017

In colleges across Kentucky, students are beginning their fall semester — some for the first time, some returning to complete a degree. Here are five things about higher education in our state to keep in mind as the new school year begins.

State budget cuts have continued

Kentucky ranks in the bottom 10 states in the nation for per-student higher education funding cuts since 2008, according to a recently released report. We are also 1 of 13 states that continued to cut over the past school year, while the majority read more