FRANKFORT, Ky. — A proposal to ban pension spiking passed the Senate and now heads to the House for consideration.
The Senate nearly unanimously passed Senate Bill 6 Wednesday.
The proposal deals with the pensions of former lawmakers who take more lucrative jobs in the executive or judicial branch.
The legislative pension formula uses the highest three years of salary to calculate retirement benefits.
State lawmakers typically earn around $30,000 to $40,000 a year for part-time work, but if they take a job in another branch of government that pays considerably more, that salary would be used to inflate that person’s legislative pension.
The issue most recently came to light after Governor Andy Beshear named former House Minority Floor Leader Rocky Adkins to his cabinet for a job that pays $129,000 annually.
Senate Majority Floor Leader Damon Thayer, R-Georgetown, said Republicans have been trying to stop this practice for several years.
“This exact language in Senate Bill 6 was part of Senate Bill and Senate Bill 151 from two years ago, which was unfortunately struck down erroneously, in my opinion, by the Kentucky Supreme Court, not based on the substance of the bill but based on a technical procedure used by every other legislature in America,” Thayer said.
Senate Bill 6 would prohibit lawmakers from using wages earned in non-legislative jobs towards their pension payout.
Thayer said he sponsored this proposal back in 2011, while Sen. Jimmy Higdon, R-Lebanon, sponsored the bill in 2010.
“Back then, the House was controlled by Democrats, and they killed the bill every year after it was passed by the Senate,” Thayer said.
The state expects to see savings of about $6.7 million from the proposal.
If approved, it would take effect July 1, but it would not apply retroactively, meaning former lawmakers like Adkins could use their wages from another job towards their legislative pensions from the time their employment started to the time the bill takes effect.