Kansas Gov. Would Be Allowed to Delay Pension Payments Under New Budget Plan

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A budget proposal, approved by a Kansas Senate committee on Monday, would allow Kansas governor Sam Brownback to delay contributions to the state’s pension systems.

Under the bill, the delayed payment would be paid gradually over the course of 2 years and with 8 percent interest.

More from the Kansas City Star:

HB 2365 includes a provision that would enable the governor to delay contributions to the state’s pension system. It would require that he pay the withheld payments at an 8 percent interest rate over 24 months.

“It’s not a loan,” said Sen. Jim Denning, R-Overland Park, the lawmaker who offered the amendment. “… It smells like one, but it’s not.”

Denning said the provision was meant to free up capital for the state in the short term, but also ensure that the pensions system would be on stronger financial footing over time through the interest rate.

The provision does not limit the amount of money the governor can withhold.

The move was condemned by both the Kansas Organization of State Employees and the Kansas chapter of the American Federation of Teachers.

Both unions took to social media to express doubt that the delayed payments would be fully repaid and to voice concern that allowing the governor to use the pension system as a source of extra cash would endanger its stability.

Sen. Laura Kelly, D-Topeka, asked whether the repayment would be guaranteed. Sen. Ty Masterson, R-Andover, replied that it would be, “to the extent that anything in statute is guaranteed.”

The budget proposal currently floating around in the House also allows the Governor to delay payments.

 

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