FRANKFORT, Ky. (WDRB) -- Kentucky Republican Senate President Robert Stivers said Wednesday that mismanagement, not underfunding by the legislature, is largely to blame for the shortfall in the Kentucky Teachers Retirement System.
Stivers said the General Assembly has fully funded the KTRS over the years, according to a formula required by state law and what governors have requested.
“If they sent us $250 million, or they sent us $500 million as a placeholder in the budget, that's what we did,” Stivers said.
A video being circulated on social media is an example of what apparently prompted Stivers to address what he called “misinformation.”
The video of a pension town hall meeting hosted by Stivers features an unidentified teacher berating lawmakers.
“You all made a conscious decision to not fund your obligation,” she said.
Stivers said mismanagement of the KTRS is largely to blame for its losses and the resulting $15 billion shortfall.
“So for people to say, 'Wait a minute, there's a problem.' There is," Stivers said. "But the biggest part of the problem is the systems themselves."
KTRS executive Beau Barnes said most of the problems Stivers pointed to were caused by market downturns during the "Great Recession."
In a statement, the Kentucky Education Association said the legislature failed in its obligation to “look back” at the end of each biennium and fund the difference between what the formula required and the amount necessary to fully fund retirement allowances.
The statement continued, “Although it’s a convenient argument to make now, TRS management and investment returns are not the issue. The retirement system has never missed a payment to a teacher in its 76 year history. KEA has full faith in the leadership of TRS and in the viability of the system.”
Democratic Senator Morgan McGarvey of Louisville agreed there are questions about KTRS that need to be addressed, but he added that is not most important right now.
“The more we start casting blame right now, the worse we look," McGarvey said. "We need to get together. We need to solve this problem."
On that last point, Stivers agreed.
“We all know there's a problem, and we're trying to address it,” he said.
Stivers said the pension fix bill crafted by House and Senate Republicans and Gov. Matt Bevin should be unveiled later this week or early next.
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