State Pension Deficit May Force Changes For Public Employees

By: Stephanie Diffin Email
By: Stephanie Diffin Email

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March 9, 2011

With the state pension fund facing a $7.7 billion gap, lawmakers are looking into how to fix the problem without raising taxes. It means state employees may have to change their retirement plans.

Employees who are part of the state pension system, called KPERS, get their retirement benefits after earning a certain number of points. Right now, it's possible for people to earn those points by the age of 55. But lawmakers say the state just can't afford that any longer.

"What we're trying to do is address the fact that we're running out of money to pay for the people that retire early," said Republican KS Rep. John Grange, vice-chair of the House Committee on Pensions and Benefits.

So the committee approved a bill Wednesday that would abolish the point system beginning in 2016. Instead, the KPERS retirement age would match up with the age required for social security benefits, putting it between 65 and 67 years old, depending on when someone is born. People would still be able to retire early, but they would have to take a cut to their benefit check in order to do so.

"I would hesitate to say anybody is being punished to make them work until the age of 66-and-a-half. It happens in the private sector," said Grange.

But those choosing work in the public sector say they shouldn't pay for the pension's deficit.

"We didn't create the problem, the legislature created the problem, and now they're looking for us to fix it for them," said United Teachers of Wichita President Larry Landwehr.

Landwehr says teachers and other public employees should get the benefits they're already working for.

"It's like coming into the game and these are the rules and now we're going to change the rule midway through the game," said Landwehr.

Legislators say the rules would not change for another five years so people would have time to plan.

The bill would also raise the amount the state is contributing to the fund, but would cut the amount employees receive after retirement as compared to the number of years they work for the state. The legislation would also put any excess funding from state real property sales towards the pension fund.

The bill will now go to the full House for debate. The Senate is also working on their own version of a bill to help bridge the KPERS budget gap.

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