Kentucky Lawmakers Consider Retiree Health Care Mandate Delay

February 9, 2009 ( - A committee of the Kentucky state house has approved a measure doubling the amount of time local government agencies have to fully fund their retiree health-care costs.

A LouisvilleCourier-Journal news report said state Representative Mike Cherry’s bill would increase the time limit from five years to 10 to give cities, counties and school districts time to figure out how to pay for their retiree health costs.

According to the news report, the movewould save local governments and schools an estimated $40 million in the next fiscal year and $60 million in 2011, but would cost them $120 million more over the next 20 years, a Legislative Research Commission analysis of the measure determined.The extra cost would be to compensate for the investment earnings lost as a result of the short-term savings the bill authorizes, the newspaper said.

Governor Steve Beshear has endorsed the plan, which now goes to the full House, but it’s unclear if it can pass both chambers.

Cherry said that, while the bill would cost local governments and schools more in the long run, it’s needed to help them through the current economic crisis. “I’m firmly convinced we’re going to be in better shape financially in some period of time,” Cherry told the newspaper.