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Minutes for HB2405 - Committee on Ways and Means
Short Title
Authorizing the issuance of $1,000,000,000 of pension obligation bonds to finance a portion of the unfunded actuarial liability of KPERS.
Minutes Content for Mon, Mar 22, 2021
Chairperson Billinger opened the hearing on HB 2405. David Wiese, Office of the Revisor of Statutes, provided an overview of the bill and responded to questions from Committee members. (Attachment 7)
Alan Conroy, Executive Director, Kansas Public Employees Retirement System (KPERS), spoke as a proponent of the bill. The KPERS Board of Trustees has no position when it comes to policy decisions but the Board is strongly supportive of any legislation that improves the financial position of KPERS. A possible amendment would be to make it effective upon publication in the register vs. the statute book. Also, as currently written, the State Finance Council must approve a resolution stating the parameters of the bond issuance. Another possible amendment would be to have the Kansas Development Finance Authority do this instead. Mr. Conroy responded to questions from Committee members. (Attachment 8)
Jim McMurray, Kansas Development Finance Authority, responded to questions from Committee members regarding the amount of bonds the State has.
Ernie Claudel, Kansas Association of Retired School Personnel and Kansas Coalition of Public Retirees, testified in favor of the bill. The standard goal for a retirement system funding level is 80 percent on the way to 100 percent. In 2016, the Trust Fund level was 56.7 percent. We have improved that to 70 percent but it is still not in a solid funding position. Previous bonds are doing well and, with present bond rates, this appears to be an ideal time for issuance of the proposed bond. (Attachment 9)
Representative Steven Johnson, 108th District, provided oral testimony in support of this bill.
Written only testimony in opposition to the bill was submitted by:
Dave Trabert, Kansas Policy Institute (Attachment 10)
James Franko, Kansas Policy Institute (Attachment 11)
There being no further conferees, Chairperson Billinger closed the hearing on HB 2405.
