FRANKFORT—A bill that could slow the financial hemorrhaging of the state’s public pension systems by improving system transparency and performance advanced today after passing the Kentucky House 99-0.
Senate Bill 2, sponsored by Sen. Joe Bowen, R-Owensboro, would provide better oversight of those serving on state retirement system boards, tighten requirements for investment experience, and hold retirement system board members, staff, and investment advisors to the same standard code of conduct followed by the larger investment community, said Rep. Brian Linder, R-Dry Ridge.
It also includes provisions to require that investment expense and return reporting be completed on a quarterly basis and preserve a ban so-called “placement agents” –individuals who help fund managers with financing—among others.
Linder, who chairs the House Budget Review Subcommittee on Personnel, Public Retirement, and Finance and serves on the legislative Public Pension Oversight Board, called SB 2 a true pension transparency bill.
“I think most of us in this body would agree that the two main problems that face the commonwealth at this moment in time are heroin and our unfunded pension liability. Billions and billions and billions of dollars in unfunded liability,” said Linder. SB 2, he said, will help to fix some of the problems the state retirement systems face.
“This is good government at work. This is compromise. It’s a good government bill,” said Linder.
Rep. Derrick Graham, D-Frankfort, who represents thousands of state employees and retirees, said the bill isn’t perfect. But, he said, SB 2 “is a bill which I think all of us can agree upon.”
SB 2 now returns to the Senate for final passage.