A few thoughts on the Herald-Leader story about Steve Beshear’s plan for state retirement systems. I’ll have more after we actually see the bill.
From the Herald-Leader:
FRANKFORT -- The state would save several hundreds of millions of dollars a year for its financially strapped retirement systems under a plan Gov. Steve Beshear and lawmakers are to unveil Thursday.
The plan primarily would affect future hires. It would raise the years of service before state workers could retire but not for teachers, place restrictions on "double dipping" in which state workers retire and then return to a job in government and eventually draw two pensions, and create a special panel to review any proposed changes in the pension systems.
House budget chairman Harry Moberly Jr., D-Richmond, said the primary area in which the plan deals with current employees is the cost-of-living adjustment on the pension system for state workers.
Their annual cost-of-living adjustment for current and future retirees would be 1.5 percent. Any adjustment higher than that would have to be approved and pre-funded by the state legislature. The COLA now is tied to the rate of inflation. In recent years, retirees have been getting about a 3 percent increase each year.
The COLA change "is going to be necessary," Moberly said in an interview Wednesday. "Overall, I think the governor has put forth a reasonable plan."
Some thoughts on what was in the story:
Double Dipping
This will not include any current employees. If it did Beshear would have to send home half of the people he has appointed to jobs in state government.
Teachers
These sacred cows can’t be touched by Beshear. After all the Jefferson County Teachers Association is one of the water carriers for legalizing Casinos.
Future Employees
The new employees will bear the brunt of the funding burden; it’s easier to screw the guys with no voice in the process.
Retiree’s COLA
Tough luck if your pension doesn’t keep up with inflation. You should be used to it, the same thing happened to your raises when you were working for state government.
What wasn’t in the story was the mention of health care. Why this 800 pound gorilla sitting in the corner of the room was ignored is puzzling. At first blush this looks like band-aid fixes at best.
God forbid that Beshear, Moberly and the rest of the so called leaders of both parties in Frankfort have the guts to actually propose changing the tax laws to a fair system that would meet the obligations of state government.
Thursday, February 21, 2008
Shell Game
A crony of Ernie Fletcher is about to make big bucks from building a hotel at the horse park. The problem is this deal just doesn’t smell right.
From the Herald-Leader:
When the Bluegrass Equine and Tourism Foundation was formed in March 2007 to build a hotel at the Kentucky Horse Park, one of its members was Steve Branscum, one of then-Gov. Ernie Fletcher's closest friends and political allies.
The Russell Springs construction magnate is no longer on that board. But Branscum's company is one of two signed on to build the hotel. Construction costs for the $90 million project are expected to be about $51 million. Branscum stepped down from the foundation board at the suggestion of the Internal Revenue Service, according to the man who put the hotel deal together.
"The IRS didn't say it was a conflict," said Brad Burgess of the Thayer Group, which is heading up the hotel development with Cincinnati-based Boorn Partners. "They suggested that we reduce the number of people on the board."
Right….. The IRS made a suggestion? I guess the guys at the IRS didn’t have anything better to do than take a look at this house of cards and make a suggestion that that Branscum leave the board. I have to wonder if the suggestion was in the form of, “If this guy doesn’t leave the board then the Federal Government will haul your corporate butt in to court.” We’ll never know.
Rep. Jim Wayne once again proves he is the only person in the legislature that can do math.
Rep. Jim Wayne, D-Louisville, was the sole member of the Capital Projects and Bond Oversight Committee to vote against the deal on Tuesday. "There are serious questions here, when you have a board of directors of an LLC be the same directors as the non-profit foundation," Wayne said Wednesday. "No banker would approve of this. It's a shell game."
I agree with Wayne, no banker would approve of this. However, Jonathan Miller’s Finance Cabinet didn’t have any such reservations signing off on the shell game.
The state Finance and Administration Cabinet awarded the bids and has signed off on the financing. But all other administration is left to the LLC and the non-profit foundation.
From the Herald-Leader:
When the Bluegrass Equine and Tourism Foundation was formed in March 2007 to build a hotel at the Kentucky Horse Park, one of its members was Steve Branscum, one of then-Gov. Ernie Fletcher's closest friends and political allies.
The Russell Springs construction magnate is no longer on that board. But Branscum's company is one of two signed on to build the hotel. Construction costs for the $90 million project are expected to be about $51 million. Branscum stepped down from the foundation board at the suggestion of the Internal Revenue Service, according to the man who put the hotel deal together.
"The IRS didn't say it was a conflict," said Brad Burgess of the Thayer Group, which is heading up the hotel development with Cincinnati-based Boorn Partners. "They suggested that we reduce the number of people on the board."
Right….. The IRS made a suggestion? I guess the guys at the IRS didn’t have anything better to do than take a look at this house of cards and make a suggestion that that Branscum leave the board. I have to wonder if the suggestion was in the form of, “If this guy doesn’t leave the board then the Federal Government will haul your corporate butt in to court.” We’ll never know.
Rep. Jim Wayne once again proves he is the only person in the legislature that can do math.
Rep. Jim Wayne, D-Louisville, was the sole member of the Capital Projects and Bond Oversight Committee to vote against the deal on Tuesday. "There are serious questions here, when you have a board of directors of an LLC be the same directors as the non-profit foundation," Wayne said Wednesday. "No banker would approve of this. It's a shell game."
I agree with Wayne, no banker would approve of this. However, Jonathan Miller’s Finance Cabinet didn’t have any such reservations signing off on the shell game.
The state Finance and Administration Cabinet awarded the bids and has signed off on the financing. But all other administration is left to the LLC and the non-profit foundation.
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