House panel advances $3.3 billion loan for teacher pensions
FRANKFORT, Ky. (AP) — Kentucky taxpayers would take out the biggest loan in state history under a bill approved by the House budget committee on Tuesday.
The bill would let the state borrow $3.3 billion to bail out the struggling Kentucky Teachers’ Retirement System. The system pays $144 million in benefits every month but only has a little more than half of the money it needs to continue making those payments.
Without the loan, pension officials warned the state’s annual required contribution would swell to more than $2.2 billion by 2035. But with the loan, the state’s required contribution would be $500 million by then.
The bill now goes to the full House of Representatives. But it faces long odds in the Republican-controlled state Senate.