A bill allowing lawmakers to voluntarily have their legislative pensions based solely on their pay in the General Assembly unanimously passed the Senate Thursday.
Senate Bill 4 aims to undo "reciprocity" provisions passed in 2005 that allow legislators to base their pensions on pay from other future, higher-salaried state or judicial positions. Lawmakers would sign a waiver forgoing reciprocity if they so choose under SB 4. The bill would apply to former lawmakers and those already serving, though salaries earned before Jan. 1 would be covered.
"As we have dealt with difficult times and grappled with pension plans that were a towering difficulty, this is a matter of leading from the front," said Sen. Chris McDaniel, a Taylor Mill Republican and sponsor of the bill. "This is a matter of doing the right thing by those we are charged to oversee."
An actuarial analysis of SB 4 estimates if all lawmakers voluntarily had their legislative pensions separate from others in state service, the state's contributions to the legislative retirement plan would drop $6 million total from fiscal years 2016 through 2033.
"While that is not a lot of money in terms of the budget of this commonwealth, it is a lot in terms of the peace of mind of the voters who expect us to be good stewards of their tax dollars and to be here to serve them, not to enrich ourselves," McDaniel said on the Senate floor.
The analysis, completed by Brentwood, Tenn-based Bryan, Pendleton, Swats and McAllister, also states lawmakers have always had the option of separating their legislative retirement from others in state government — if he or she served in the General Assembly first — by retiring and collecting a legislative pension before accepting a new position in another branch of government.
No legislator has taken that route, according to the analysis.