KY Supreme Court Hears Pension Reform Law Arguments

FRANKFORT, Ky. (AP) — Kentucky Governor Matt Bevin (above) and Attorney General Andy Beshear, potential opponents in next year's race for governor, clashed before the state's Supreme Court on Thursday as they argued about the future of one of the country's worst-funded public pension systems.

The state's Republican-dominated legislature passed a law earlier this year that put new teacher hires into a hybrid pension plan. Supporters say the plan has the potential to be more lucrative for teachers than a traditional pension, while opponents argue it is less predictable and makes it harder to plan.

All of Kentucky's public pension systems are significantly underfunded. Actuaries estimate the state is at least $37 billion short of the money needed to pay benefits over the next few decades. The law included other provisions designed to help the state pay off the debt sooner.

But the law has been a political flashpoint, inspiring thousands of teachers to protest at the Capitol. In May, a high school math teacher with no prior political experience defeated the House majority floor leader in a Republican primary. In November, at least 34 current and former teachers are on the ballot for seats in the state legislature.

Thursday's hearing before the state Supreme Court was more subdued. Kentucky Educational Television broadcast the arguments live for only the second time in the court's history. The small courtroom was full, with a small crowd watching on a TV just outside the courtroom.

Across the state, some civics and government teachers planned to use the Supreme Court arguments as part of their lesson plans. Others, like Rockcastle County High School Spanish teacher Erin Grace, did not have that option. But Grace said she's through thinking about the law's future.

"I'm mostly thinking about elections right now," she said. "We've just got to vote in the elections so they don't have a chance to do it again."

Beshear argued the case himself, which was broadcast live on Kentucky Educational Television, giving him a platform to speak to the state's teachers and their families. Bevin did not attend Thursday's hearing, but he made his arguments in a series of messages posted to his official Twitter account.

Bevin and his lawyers believe the law is constitutional in that it does not violate the contract rights of public employees. But they never got to make that argument on Thursday, as the Supreme Court justices focused solely on the process that lawmakers used to pass the bill.

The state Constitution says bills must have three "readings" on three separate days in the House and Senate before it can become law. But lawmakers passed the pension bill in about seven hours. They took a bill about sewer systems that had already passed the Senate and been given two readings in the House and replaced it with the pension bill. House lawmakers then voted on it, and the Senate agreed with the changes.

Beshear says this is illegal. He says the state Constitution requires the three readings on three separate days to prevent bills from being rushed through the legislature in one day.

"The Kentucky Constitution crates a government by the people and for the people, which means you can never shut the people out," Beshear said.

Steve Pitt, Bevin's attorney, noted the Constitution gives the legislature the power to make its own rules about procedure. House and Senate rules say lawmakers can change a bill without restarting the legislative process.

"What the attorney general wants here is for this court to tell the General Assembly how to conduct its own internal business," Pitt said. "The question is do we have separation of powers in this state?"

Pitt's argument did not sit well with a number of judges, including Justice Lisabeth Hughes.

"(The legislature) cannot make a decision if it is contrary to the plain language of the Constitution. I took an oath to uphold the Constitution of the United States and the Constitution of this commonwealth. And the legislators took the same oath," Hughes said. "This is not a matter of judiciary sticking its nose, if you will, into the legislative branch."

The court did not make a ruling Thursday. There is on deadline for their decision, but it will likely come before lawmakers return to Kentucky in January for the next legislative session.

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