Archive for Tuesday, July 25, 2006

KPERS studies increase in retirement age

Public employees would have to work until age 65

July 25, 2006

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— Public employees would be unable to retire with full benefits until age 65 under a proposal being considered by the Kansas Public Employees Retirement System.

Glenn Deck, executive director of KPERS, said a new retirement plan is needed as a cost-savings measure because retirees are living longer and drawing more deferred benefits, and the state's contribution rate to the system lags behind what is needed.

Deck emphasized that if a new plan were approved by the Legislature, it would apply only to employees hired after the plan went into effect, not those already working.

He said the proposed changes are needed for the long-term health of the system, noting that KPERS' investments just ended a banner year of approximately 12 percent profit.

"I think you're on the right track," Senate President Steve Morris, R-Hugoton, told Deck during a meeting of a House-Senate committee on pensions and benefits.

Morris, who is chair of that committee, said proposing a new retirement plan is the "No. 1 priority" for the panel.

KPERS is the pension system for state employees, counties, school districts and most cities, including Lawrence, except for public safety workers. It has $12.2 billion in assets that it invests on behalf of 250,000 members, approximately one in 12 Kansans.

Currently, KPERS members can retire as early as age 55 if they have 30 years of service.

But increasing life expectancy and a wave of Baby Boomers either at or nearing retirement age will create a drain on the system, Deck said.

Deck said increasing the age for retirement has been considered by other public pension systems, including the federal government, which has raised the age at which people can get Social Security benefits.

Mark Tallman, a lobbyist for the Kansas Association of School Boards, said he supported the committee looking at changes.

"It's something that needs to be done," Tallman said.

Mark Desetti, a lobbyist for the Kansas-National Education Assn., said his group would maintain an "open mind."

But, he said, a new retirement plan that was considered during the last legislative session "made people work longer for lower benefits."

That measure stalled in committee.

KPERS officials said they hope to provide a final recommendation to the committee in September.

Comments

Wilbur_Nether 8 years, 11 months ago

This makes sense to me not only with KPERS but with Social Security and with pensions and 401ks. 65 seems to me to be a fairly young retirement age any more.

Jayhawk226 8 years, 11 months ago

Well, I sure hope that I'm reading this correctly...since I'm already working and paying into the system, I would be eligible to retire at 55 with 30 years service, after hitting that magic "80" number.

65 is fairly young for sure...but would take a toll on me psychologically if I assumed throughout my career that I could retire 10 years earlier, on schedule.

But heck, I'll be lucky if KPERS is even around when I'm ready to retire.

Janet Lowther 8 years, 11 months ago

If the state does this, they will need to get their pay scales more in line with private enterprise.

In private enterprise people in similar positions make $20K/year more.

Early retirement is the ONLY reason I'm planning on staying with the state the next few years.

BTW, the magic number is 85, not 80.

Confrontation 8 years, 11 months ago

State workers don't realize how easy they have it. Very few workers in Kansas have cheaper insurance rates. They complain about their low salaries, but love it when they can overuse their insurance and help raise the state tax rates.

OldEnuf2BYurDad 8 years, 11 months ago

"Early retirement is the ONLY reason I'm planning on staying with the state the next few years."

Yeah, my wife is terribly underpaid, and if she continues to be (and I'm sure she will be, the way things are in Kansas), then I'll encourage her to get out as soon as she can. She should be able to get out around 60 or so, I think.

shockchalk 8 years, 11 months ago

On the contrary, employee's in the private sector don't comprehend how difficult it is to make it on a state salary. There are plenty of safeguards in place that prohibit people from the "overuse" of their insurance regardless of who their employer is. "Confrontation" should be more careful when throwing stones.

redfred 8 years, 11 months ago

"KPERS had a banner year with 12% profit on investments" However, retirees haven't had a COLA since 1998. Somethings wrong with this picture also.

Confrontation 8 years, 11 months ago

I worked for the state until 2004. Everyone I knew, even the administrative assistants, were getting paid more than anyone with similar jobs in the Lawrence private sector. I believe that employees believe they should be paid more due to the horrible environment, especially when putting up with the complete idiots who are in charge. I worked for the Dept. of Health & Environment, which is full of abusive supervisors and addicts of all sorts. So much for the health aspect. I'm sure there were some employees being underpaid, but the benefits of health insurance should not be underestimated.

Linda Endicott 8 years, 11 months ago

All people who are eligible for KPERS don't necessarily work directly for the state. My uncle worked for a local school system, and when he retired, he barely had enough, from both KPERS and SS, to live on.

I also contribute to KPERS through my job, which is not with the state. I do not receive health insurance from the state. I pay for my own through the company I work for.

Anyone who works with people that the state provides funding for (students, the elderly, the disabled) are eligible for KPERS. They do not receive health insurance through the state.

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