I will be speaking at a special meeting of the Nelson County Tea Party tonight at 7 p.m. at B.J.’s Restaurant in Bardstown. All are welcome to attend.
Greater transparency and accountability may have exposed padded student counts
Kentucky Department of Education briefers unsuccessfully tried to tap dance today around a firestorm that has blown up over the next school year’s funding for preschools. Their two-step involved one of the most confusing presentations I have ever heard in a state legislative meeting (for an example of that confusion, read this article, which tries to explain what is going on).
The dance routine failed to mollify legislators, who are hot about this situation for several reasons.
The preschool funding issue blew up several weeks ago when the Kentucky Department of Education notified each school system about how much money would be provided for each district’s preschool program next year. About half the districts in the state found out they would see less money, triggering incorrect charges against the legislature, including the untrue allegation that lawmakers had cut preschool funding.
In fact, state preschool funding has not been cut. What actually happened is that a very complex and deficient formula for distributing the funding – one that some legislators charge violates state law – was the root cause of the problem.
Coupled with this deficient formula, which was developed many years ago by the department of education – not the legislature – was something else; for the first time this year the department got much more accurate reports on the real number of learning disabled and disadvantaged preschool students in each district. Those more accurate numbers, often lower than figures reported in previous years, resulted in the funding changes.
This revelation led some legislators to rather directly suggest that in prior years (when the counts of special preschool students were harder to audit), some districts may have ‘padded the enrollment books’ to get more money.
Pressed today by legislators, state educators admitted the funding formula in question has actually been in place for several decades. Local school districts should not have been surprised by the resulting calculations. The only thing new was the requirement to report student counts accurately, something that should have created no problems for districts that had been doing an honest job in the past.
Another issue added still more to educator-legislator tension. That was an e-mail that got sent out from the department of education in response to complaints from at least one school district. That e-mail blamed the Kentucky Senate for the funding declines because the Senate didn’t pass House Bill 329.
Obviously miffed legislators shot holes in that e-mail today. Some pointed out that department of education never indicated that HB 329 was critical. Others said the bill would not have taken effect in time to fix the coming school term funding in any event. It was also carefully pointed out that the bill only addressed learning disabled student funding and said nothing about funding for preschool for disadvantaged students.
In the end, legislators demanded to know that the correct message had been sent out to the school districts, and the department of education personnel said that had occurred.
Aside from the fact that the department needs to be careful about taking incorrectly aimed pot shots at legislators, there is another message here.
Increased transparency and accountability for our school system is badly needed. In this case, what looks like possible prior padding of special students head counts to improperly get more money may be coming to a close now that a more powerful and auditable student tracking program is in place. It’s about time.
“President Obama, acting through the EPA, has stifled the mining industry. EPA’s strangulation by regulation is the cause for today’s hearing but it is by no means the only front in this Administration’s War on Coal.
“Indeed, the Obama Administration is attacking coal on all numerous fronts. In Kentucky, EPA is delaying, denying, or obstructing the permits needed to extract it from the ground. Nationwide, EPA is imposing regulations on power plant emissions that are unworkable and unaffordable in hopes of drowning this industry in billions of dollars of new regulations. At the same time, EPA is attempting to re-classify coal ash left-over after combustion as a hazardous waste, which is directly counter to the EPA’s own scientific findings. This last case is particularly informative. As EPA attacks coal at every stage of its life cycle, from extraction to disposal, it is doing so with little regard for science or environmental protection. For EPA, it’s about ending coal first and protecting the environment second.”
– Congressman Brett Guthrie’s statement for the EPA Coal Mine Permitting Hearings
(FRANKFORT, Ky.) – A new report by the Bluegrass Institute, Kentucky’s free-market think tank, holds legislators primarily responsible for the commonwealth’s public-pension crisis, noting that politicians of both parties have demonstrated “flat-out greed and disrespect for the public treasury” by adding benefits for political gain and enriching themselves at taxpayers’ expense.
“Defenders of the status quo will try and spin our pension system crisis as being the result of challenging economic times and poor returns on market investments,” said Jim Waters, the institute’s president. “But as this report shows, politicians have been using Kentucky’s pension system for political gain for decades while stubbornly refusing to make the tough decisions needed to protect taxpayers, ensure funding is available for important services and safeguard state workers’ pension funds.”
Authored by Lowell Reese, owner of Kentucky Roll Call, a public affairs publishing company in Frankfort, and a former state chamber of commerce executive, the report, entitled “Future Shock: Kentucky Politicians’ Opulent Pensions Have Become A Modern-Day Gold Rush,” names both current and previous legislators who personally benefited from critical votes approving House Bill 299 in 2005.
This bill made several changes to legislators’ pensions:
- The policy known as “reciprocity” was adopted. Not only did the law lower the number of high-salary years used to figure lawmakers’ pensions from the previous “high five” to “high three” years, it allowed them to significantly enrich their retirement plans by basing their legislative pensions on jobs they get in other government entities covered by one of the six state-administered pension systems after they leave the legislature.
- HB 299 also lowered from 30 to 27 the number of years legislators must serve before they can start drawing their pensions prior to age 65 without an early penalty withdrawal.
- Any member not in the legislative retirement plan as of 2005 could still join and be eligible for the bonanzas to come. The utter lack of transparency involving the state’s pension systems makes it impossible to know how many legislators participate in this gold rush.
- The legislators’ “assumed” salary amount of $27,500 – used previously in the formula to figure pensions – was replaced with their real salaries. Like one stroke of a canoe paddle can significantly alter its course, the slightest change in the formula can considerably inflate a pension check, as this one does.
Along with noting the 30 state senators (13 Democrats, 17 Republicans) and 48 representatives (30 Democrats, 18 Republicans) who voted for HB 299, known as “the greed bill,” the report also portrays Frankfort as “a culture of pensions” where “it’s common to find people drawing two, or even three, government pensions.”
The fact that “legislators have joined the parade” could have a corrupting influence on the legislative process.
“We don’t know if the governor is keeping a list,” it states. “What we do know is, Gov. Beshear has received many requests for state jobs from members of the House and Senate – not jobs for their constituents, but positions for themselves for the pension benefits they offer!”
While politicians no doubt will try and blame the economy, the report points out that the primary culprit contributing to the Bluegrass State’s pension crisis is benefit creep – the gradual padding of pensions and fringe benefits that only legislators can authorize.
“The main message of this story resides in the subsurface — the attitude of the General Assembly … demonstrated by flat-out greed and disrespect for the public treasury, which now has put the standard of living of all Kentuckians in jeopardy,” Reese writes in the report.
A timeline in the report shows how that for decades, political leaders from both parties have displayed benefit-benevolence at taxpayers’ expense in the form of adding pension benefits, going all the way back to the administration of Gov. Simeon S. Willis (1943-47), when teachers were allowed to “buy” up to eight years from teaching in another state.
Previous reports in this series include Future Shock: Legislators stoking the coals on Kentucky’s runaway pension train and Future Shock: Kentucky’s public pension hole: deep and getting deeper.
Taking liberty to the airwaves: New BIPPS pension report author Lowell Reese joins Joe Elliott this afternoon
Lowell Reese, author of “Future Shock: Kentucky Politiicans’ Opulent Pensions Have Become a Modern-Day Gold Rush,” a new report by the Bluegrass Institute, will join award winning talk-show host on “The Joe Elliott Show” on 970 WGTK-AM today at 1 p.m. (EDT).
“The Joe Elliott Show” is broadcast weekdays from Noon to 3 p.m. EDT. Listen live here.
Also, Bluegrass Institute president Jim Waters will discuss the report on Newstalk93 WKCT-AM’s “Drive Time” show with host Chad Young today at 5 p.m. (CST). Listen live here.
Waters also will be on the “Brooks & Co.” radio show on Tuesday on Bardstown’s 1320 WBRT-AM. Listen live here.
The show, which airs each Tuesday from 11 a.m. to Noon, is hosted by Jim Brooks, editor of the Nelson County Gazette, which carries Waters’ weekly Bluegrass Beacon column each Thursday.
The report will outline how Kentucky’s legislators have voted to increase their own wealth by sweetening their pensions on the backs of Kentucky’s taxpayers.
You don’t want to miss this!
From the report:
According to the Legislative Research Commission, the state’s current debt from borrowing is $9.6 billion — an impressive amount, but not so much compared to the retirement systems’ debt, which is $34.5 billion. As a percent of our state’s personal income, this combined debt of $44.1 billion is near the highest — if the not the highest — among the 50 states.