After three decades, an important step toward ending the pension crisis in Lexington was taken Friday.
And it could mean a win-win for taxpayers AND fire and police union members.
The agreement reduces the unfunded liability--or the money needed to pay all future potential benefits--from an estimated $296 million to $161 million, according to Vijay Kapoor, a pension consultant with The PFM Group.
It would also re-vamp annual cost-of-living adjustments for police and fire union members, as well as increase the city's annual payment from $11 million to $20 million.
The reform would also increase employee salary contribution from 11 percent to 12 percent, reduce disability pensions from 60 percent of pay to 50 percent of pay, and place the minimum retirement age for current employees at 41.
And the president of the fire union said those aren't the only changes the reform could bring.
"It gives more room for the budget to be used for other services. Hopefully ends the brownouts, and we can hire some people, too," said Chris Bartley, IAFF President Local 526.
"It'll allow us to attract the quality of folks that we're used to getting here in Lexington. And providing the level of service that our citizens are accustomed to," said Chief Ronnie Bastin of the Lexington Division of Police, in a statement at the pension reform meeting Friday morning.
Before the agreement goes through, the unions have to vote on it. After that, it would need to be adopted by the Kentucky State Legislature.
However, Bartley said that if it goes through, it could last forever.
"As long as the market continues on, this thing is on sound footing."
