Pension Transparency Bill Moves Forward in Kentucky House

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A bill that would require greater transparency from Kentucky’s pension systems was approved by a House panel on Thursday.

The measure would completely overhaul the oversight of several of the pension systems’ actions, including the hiring of outside money managers.

Kentucky Retirement System officials have spoken out against the “drastic” changes.

More from the Courier-Journal:

Senate Bill 2 would require the pension systems to use open, competitive bidding procedures when hiring investment managers and to accurately disclose the millions of dollars in fees they pay those managers. Unlike most state agencies, the pension systems are presently free to hire investment managers based on their own discretion, withholding those contracts from outside review.

The bill also sets new standards for the boards overseeing the Kentucky Retirement Systems and the Kentucky Teachers’ Retirement System. For example, the Senate would have to confirm the governor’s six appointees to the KRS board, as well as the KRS executive director. Several lawmakers were upset last year when the KRS board awarded a 25 percent pay raise to its executive director, Bill Thielen, taking him to $215,000 a year.

Finally, the bill would force the Kentucky Judicial Form Retirement System — which provides pensions to legislators and judges — to create a website that provides the same financial and management information about itself that KRS and KTRS long have offered online, such as audits, investment returns and board meeting reports.

[…]

Thielen, the KRS executive director, spoke against what he called “drastic changes to the oversight of our system.” He said the KRS board currently approves the hiring of all investment managers following vetting by KRS staff. Forcing KRS to accept competitive bids for investment management would yield a large number of unqualified applications, making the process more cumbersome, he said.

The text of the bill can be read here.

 

Photo by TaxRebate.org.uk via Flickr CC License

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