Courier Journal, November 11, 2014:
"A Louisville teacher filed a lawsuit Monday demanding that the Kentucky Teachers Retirement System do more to seek funding from the state and better communicate its financial woes with members."
"Randy Wieck, a U.S. history teacher at DuPont Manual High School who is behind the suit, alleges that KTRS has failed in its fiduciary duty by not aggressively pursuing the state money it needs to remain solvent." "He wants KTRS to support legal action against the Kentucky General Assembly if full funding for teacher pensions is not provided within a year."
(My comment: The Colorado approach to public pension underfunding has been breach of pension contract. Specifically, in 2010, Colorado PERA public pension officials supported legislation to take accrued public pension benefits to reduce pension system underfunding. These Colorado PERA officials argued that the contract for the Colorado PERA COLA benefit indeed existed, but that a one-time breach of the PERA COLA contractual obligation was "actuarially necessary." As litigation of the pension benefit taking progressed, Colorado PERA's lawyers abandoned their initial legal strategy [“actuarial necessity”] and suggested to the Colorado Supreme Court that [after having admitted to the existence of the contractual obligation] the contractual obligation did not exist. Apparently, the “justices” appointed to the Colorado Supreme Court [the five who participated in the case] were willing to don the blinders and grant any political favor requested by their political allies in the Colorado Legislative Branch. Thus, the Colorado Supreme Court ignored "stare decisis," disregarded 60-year old Colorado case law, failed to conduct a "contract analysis," ignored evidence of Colorado PERA's attorneys stating that the pension benefit was indeed a Colorado PERA contractual obligation, ignored the bill (SB10-001) sponsor's testimony that the pension benefit was in fact a Colorado PERA contractual obligation, ignored recorded legislative history of the contractual nature of the public pension benefit, failed to engage in the "heightened scrutiny" of the abandonment of state financial obligations required under federal case law (US Trust) and finally, the court embraced a discredited Denver District Court decision that, conveniently, did not bother to mention Colorado's on-point public pension case law. No trial, no discovery, evidence ignored, state government forgiving state government debt, billions of dollars seized, pensions inflated away. Grand Theft Pension.)
"The suit, filed in Jefferson Circuit Court, also demands that KTRS fully communicate its 'severe state of underfunding' to members and amend its protocol with new ethics and investment requirements."
"'The purpose of this is to urge the KTRS to take up this cause,' Wieck said."
"Wieck is seeking class-action status for more than 140,000 active and retired members who participate in teacher retirement plans through the system. Chris Tobe, a former trustee of Kentucky Retirement Systems and author of 'Kentucky Fried Pensions: A Culture of Cover-up and Corruption,' is among his advisers in the suit."
"But Robert Barnes, KTRS general counsel and deputy executive secretary of operations, said Monday that Wieck's argument lacks merit."
"'KTRS has been talking about this funding issue for some time with membership, and it has been requesting that the full funding be provided to the retirement system,' he said. 'It does that every budget request.'"
"According to the 2013 valuation of KTRS, the system faces more than $13.8 billion in unfunded liabilities and has only 52 percent of the money it needs to pay out pension benefits in coming decades."
"Officials say KTRS needs around $400 million a year in additional money from the state to shore up investments and meet its obligations."
"Barnes said the system is working with lawmakers to develop a financing plan that involves low-interest bonds — paid for with existing revenue streams."
"House Speaker Greg Stumbo, D-Prestonsburg, indicated last week that the Democratic-controlled House is interested in considering bonds as a funding option, but Senate President Robert Stivers, R-Manchester, has reserved judgment."
"Wieck also warned that he might file additional lawsuits against the legislature and the governor depending on what happens in the 2015 General Assembly."
"He said shoring up the system is critical considering that teachers do not receive Social Security benefits."
See the article at the Courier Journal here:
Discover the true nature of government in Colorado at saveperacola.com.