Daily Independent (Ashland, KY)

Local News

March 25, 2013

No pension fix late into night

(Continued)

FRANKFORT —

When Stumbo emerged an hour later, he said there was no agreement because House Democrats were “adamant about protecting the road fund, making sure our public employees, particularly the lower-paid employees, are fairly compensated after their working lives are over.

“But, no, we do not have at this point an agreement.”

So Stumbo again huddled with Beshear and again met with his caucus.

The latest plan would reduce the amount taken from the gas tax to 1-cent and implement a tax change to allow new car purchasers to reduce the amount of the purchase on which they owe sales tax by the amount of the trade-in value of their old car.

If that’s not complicated enough, Stumbo said the governor will try to restore most of the money taken from the road fund.

Stumbo said the changes are expected to generate about $110 million but estimates are only $100 million is needed for the pension plan. Beshear would use the surplus to restore “most of the road fund money,” Stumbo said.

The reason for doing that, Stumbo explained, is to offer taxpayers a “cut” in the gas tax to offset the increased taxes in the General Fund, allowing lawmakers and the governor to proclaim the plan “revenue neutral.”

Stumbo also said the House preferred to move Tuesday, the last scheduled day of the 2013 session, to Wednesday to give time for the two separate pension bills to be written.

But the Senate refused to go along and Majority Floor Leader Damon Thayer, R-Georgetown, announced moments later on the Senate floor that it would reconvene Tuesday at 9 a.m.

Public employee representatives weren’t happy.

Sharron Oxendine, president of the KEA, and Steve Barger of the Public Employee Pension Coalition earlier had welcomed news House Democrats refused to go along with the first Beshear proposal. Both said they oppose the cash balance plan for new hires and they aren’t happy they were left out of negotiations.

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