UPDATED AT 5:04 P.M.
By Jack Brammer
FRANKFORT – A group of Republican candidates for the state House and Senate called Wednesday for replacing the current pension plan for state lawmakers with a defined contribution plan like a 401-k system.
The change from the current defined benefit plan would start with all new members eligible for legislative pensions, beginning with the class of 2013, said Brian Linder of Dry Ridge, who is in a race with Democrat Wanda Crupper Hammons of Dry Ridge for the 61st House district seat,
He also said all state lawmakers would have the option to enroll in the 401-k-style plan instead of getting direct benefits for legislative pensions.
During a news conference in the Capitol Rotunda, Linder and Chris McDaniel of Taylor, who is in a contest with Democrat James Noll of Villa Hills in the Senate’s 23rd district, said the GOP plan would be the first piece of legislation the GOP freshmen would present in the 2013 General Assembly.
They said the plan would be portable to other places of employment, would allow roll-in contributions from other 401-k plans from previous employers and be subject to all IRS regulations.
It also would end retiree health care as an option for legislative service.
“We believe this action, while a small step, is an important one toward eliminating the most predictable crisis in Kentucky’s history,” McDaniel said.
McDaniel said the pension change could save millions of dollars, depending on the level of participation.
Asked why part-time legislators need a pension, Linder said, “That’s an excellent question. We have to take small steps to get where we are going.”
McDaniel and Linder said the proposed legislation is backed by a majority of GOP candidates for the General Assembly.
State Rep. David Floyd, R-Bardstown, recently drafted a bill that contains the opt-out provision for incumbent lawmakers while ending pensions for all future lawmakers.
The debate over pensions has become heated in Frankfort because of a shortfall that, by some estimates, could be as much as $30 billion in retirement plans covering lawmakers, teachers, judges, police officers, and other state and local government workers.
Republican staffers identified the candidates at the news conference besides Linder and McDaniel. They were:
House — Max Sturdivant, Don Stosburg, Dalton Jantzen, Regina Webb, Tim Kline, Bill Barron, Nick Simon, Richard Heath, Jason Crockett, Bill Pickerill, Marian Turley.
Senate — Chris McDaniel, Chris Theineman and Frank Haynes.
Kelly Whitaker, a Democrat who is running against Heath in the race for the Second House District in far Western Kentucky, said in a statement that the plan offered by Heath and other Republicans is “nothing more than a cynical attempt to replace the gold-plated pension plan for current legislators with a silver-plated version for new legislators.
“In these tough budgetary times and difficult economy, taxpayers simply cannot afford either the current gold-plated plan or Mr. Heath’s silver-plated version.”
She said she proposed nine months ago a plan that would provide no full-time pensions for part-time legislators.
“I find it disappointing that the first substantive proposal my opponent offers voters is one that feathers his own nest. My opponent’s proposal is more of the same old politics of the past – too many politicians in Frankfort looking out for their own interest rather than the interests of the citizens they swore an oath to represent,” she said.