Thursday, September 27, 2007

Lawyer: Kentucky Pension Changes Risky

A California pension expert says altering the contract that guarantees retirement benefits to public employees would be hard to defend in court.

The blue ribbon commission studying the state's pension crisis hired the attorney to get an outside opinion on whether the state could make any changes to benefits without violating what is called the "inviolable contract."

Joe Wyatt, a pension expert in California, said there was little wiggle room in the wording of the contract.

Wyatt recommended that if the state wants to alter retirement benefits for current employees or retirees, it should negotiate with the various employee and retiree organizations and reach a settlement.

"Failure to abide by the promises invites litigation," he said.

The commission is expected to make its final recommendations to the governor Dec. 1, which may include issuing pension bonds to cover the future liability and increasing for future hires the required number of years of service to be eligible for full benefits.

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