HomeMy WebLinkAboutCERS 02-05-13RESOLUTION ,
A RESOLUTION SUPPORTING REFORMS TO THE COUNTY EMPLOYEES
RETIREMENT SYSTEM (CERS) TO MAKE THE PLAN SUSTAINABLE, SOUND, AND
SECURE FOR CURRENT AND FUTURE EMPLOYEES
WHEREAS, to honor their service now and in years to come, current and future
non - hazardous duty and hazardous duty city employees deserve a defined benefit pension plan
that is sound, secure, and sustainable; and
WHEREAS, cities in Kentucky that want to offer a defined benefit pension plan
are required by the Kentucky law to participate in CERS, which is administered by the Kentucky
Retirement Systems (KRS) Board of Trustees and their employees; and
WHEREAS, the Kentucky General Assembly and the Kentucky Retirement
Systems have imposed significant unfunded mandates on cities in Kentucky by guaranteeing
minimum pension benefit levels and mandating the use of city revenues to fund pension plan
costs; and
WHEREAS, in Fiscal Year 2003, the City of Paducah paid approximately
$1,339,000 into CERS for retirement benefits for city employees; and
WHEREAS, in Fiscal Year 2013, 10 years later, the City of Paducah will pay
approximately $4,337,000 into CERS for retirement benefits for city employees; and
WHEREAS, without significant reform to CERS, employer contribution rates are
projected to continue their upward trend for decades; and
WHEREAS, the pension liability for CERS has increased $7.131 billion since
2000, despite that cities and other employers in CERS always paid what was required, which
indicates systemic problems in CERS; and
WHEREAS, the Kentucky General Assembly has created a pension plan system
for city employees that is unstable, unsustainable, and unreliable for current and future city
employees; and
WHEREAS, recognizing this problem, the Kentucky General Assembly created
the Task Force on Kentucky Public Pensions in 2012 to study and develop consensus
recommendations concerning the benefits, investments, and funding of the state - administered
retirement systems, and any other measures that would lead to the improved financial stability of
the state - administered retirement systems; and
WHEREAS, the Task Force on Kentucky Public Pensions approved a
comprehensive set of recommendations by an 11 -1 vote on November 20, 2012; and
WHEREAS, the recommendations approved by the Task Force on Kentucky
Public Pensions take a balanced approach and consider the need for long -term financial stability
in the retirement system and short-term affordability for cities that pay the bills for these
benefits; and
WHEREAS, the lack of any action during the 2013 Regular Session may worsen
the situation and jeopardize the fiscal solvency of Kentucky cities.
NOW, THEREFORE, be it resolved that the Board of Commissioners of the City
of Paducah supports the recommendations of the Task Force on Kentucky Public Pensions.
SECTION 1. The Board of Commissioners of the City of Paducah strongly
supports the following specific components of the recommendations of the Task Force on
Kentucky Public Pensions:
1. Adopt a hybrid cash balance plan for new employees in CERS;
2. Reset the amortization period for CERS for payment of the unfunded
liability to a new 30 -year period;
3. Eliminate the automatic cost of living adjustment (COLA) for all current
and future CERS retirees; and
4. Appoint an additional member to the Kentucky Retirement Systems Board
of Trustees selected by the Governor from a list submitted by the
Kentucky League of Cities.
SECTION 2. The Board of Commissioners of the City of Paducah strongly
encourages the Kentucky General Assembly to enact these reforms during the 2013 Regular
Session.
SECTION 3. This Resolution shall be in full force and effect from and after its
adoption.
ATTEST:
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Tammara S. Sanderson, City Clerk
Adopted by the Board of Commissioners, February 5, 2013
Recorded by Tammara S. Sanderson, City Clerk, February 5, 2013
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