'RED' denotes TAX EVASION of an estimated 150,000 KY car owners in 2008 operating daily on KY highways----FREE---not paying Kentucky's one-time usage and annual property taxes costing state and local governments estimated $106 million!
Bill Huff
Monday, December 31, 2007
KY TAX EVADERS ARE AGING!
'RED' denotes TAX EVASION of an estimated 150,000 KY car owners in 2008 operating daily on KY highways----FREE---not paying Kentucky's one-time usage and annual property taxes costing state and local governments estimated $106 million!
Bill Huff
Go to http://www.lrc.ky.gov/lrcpubs/rr282.pdf to see 1998 testimony before KY House Appropriations & Revenue committee about how much state and local property taxes as well as one-time usage taxes are being circumvented by KY owned motor vehicle TAX EVADERS!
It's 2007 and estimated 150,000 KY owned motor vehicles escapte paying KY's usage and property taxes and state registration fees amounting to an estimated $106 million of tax dollars!
Add an estimated $10 million u-drive-it use taxes not collected on lease/rental motor vehicles operating out of KY airports.
Add estimated $23 million of uncollected truck weight-distance tax
Bill Huff
wlhuff@gmail.com
It's 2007 and estimated 150,000 KY owned motor vehicles escapte paying KY's usage and property taxes and state registration fees amounting to an estimated $106 million of tax dollars!
Add an estimated $10 million u-drive-it use taxes not collected on lease/rental motor vehicles operating out of KY airports.
Add estimated $23 million of uncollected truck weight-distance tax
Bill Huff
wlhuff@gmail.com
Sunday, December 30, 2007
1992 KERS EMPLOYEE PENSION BLINDSIDED BY KY POLITICS
1992 Legislature's refusal and subsequent concurrent court decision---Jones v. Board of Trustees, 910 S.W. 2d 710 (Ky. 1994)---has reduced KERS funding to only 61% of its total financial needs in 2007. This is 'prima facie' evidence showing the retirement benefits promised KERS members were infringed upon by failure of 1992 Kentucky Legislature to adopt Retirement Boards's actuary's 1992 recommendations. The court decision stated "...the Commonwealth and the benefits provided there in shall...not be subject to reduction or impariment by alteration, amendment, or repeal; i.e., KRS 61.692. Thus, under Kentucky law, pension benefits for public employees and retirees are a contractual right, and those benefits may not be reduced......by the legislature retrospectively."
The 1995 Court decision regarding 1992 Legislature & Administration actions breached KERS inviolate contract [excluding $10 billion underfunded KERS health care] by condoning underfunding of KERS retirement system. Such irresponsible decions has, over time, significantly enhanced potential reduction of KERS retiree's fund if demanded collectively by KERS employees, with fund having on 61% of total funding needed to comply in 2007!
In addition, as a result of the 1995 court decision KERS retiree' funding has been singled out, therefore, discriminated against since other state retirements currently enjoy much healthier financial climates; i.e., Teachers' Retirement System has funds to cover 76 percent of its estimated needs, and County Employees Retirement System has funds to cover 81 percent of
its future needs and National average is 86%.
Legislator and Administration ought to do the right thing which is cut state expenses as recommended by the 1995 Commission On Quality & Efficiency; i.e., $1 billion dollars over next four years while simultaneously bringing Kentucky tax base into the 21st Century making funding more stable, equitable,
Any new administration should implement a detailed plan for addressing the General Fund Deficit such as cutting at least $1 billion of state tax expenses and eliminate, modernize state tax expenditures simultaneouslyincreasing state revenues over 5 years.
Other 2008 recommended action implemented:
The 1995 Court decision regarding 1992 Legislature & Administration actions breached KERS inviolate contract [excluding $10 billion underfunded KERS health care] by condoning underfunding of KERS retirement system. Such irresponsible decions has, over time, significantly enhanced potential reduction of KERS retiree's fund if demanded collectively by KERS employees, with fund having on 61% of total funding needed to comply in 2007!
In addition, as a result of the 1995 court decision KERS retiree' funding has been singled out, therefore, discriminated against since other state retirements currently enjoy much healthier financial climates; i.e., Teachers' Retirement System has funds to cover 76 percent of its estimated needs, and County Employees Retirement System has funds to cover 81 percent of
its future needs and National average is 86%.
Legislator and Administration ought to do the right thing which is cut state expenses as recommended by the 1995 Commission On Quality & Efficiency; i.e., $1 billion dollars over next four years while simultaneously bringing Kentucky tax base into the 21st Century making funding more stable, equitable,
Any new administration should implement a detailed plan for addressing the General Fund Deficit such as cutting at least $1 billion of state tax expenses and eliminate, modernize state tax expenditures simultaneouslyincreasing state revenues over 5 years.
Other 2008 recommended action implemented:
Regarding KERS state employees "hired on or after July 1, 2003, who have a contractural right to medical benefits" Legislature and Administration agree to fund KERS retirement account for next two bienumms even with County Employees' 81%
To protect current and future state tax resources and to successfully launch new KERS retirement plan, amend current legislation mandating all KERS employees (including all locally elected state representatives and senators) automatically switched January 1, 2008 to defined contribution retirement plan, accompanied by state guarantee state shall make a future one-time payment to KERS state emploee saving plan ; and,
all KERS non-merit Directors switched to merit system
compensated according to merit pay scale eliminating all non-merit Directors;eliminate all Policy advisors, special advisors, administrative assistant, executive and executive assistant positions currently being compensated at or above $48,000 annually and grant savings to merit pay KERS employees as one-time raise.Reorganize all Cabinets into Departments with Commissioners heading
Departments with Salareis maxed at $75,000 annually.Further reduce state expenses through:
Decrease Medicaid program COSTS by an estimated $850 million by paring down
contracts being paid $100,000+ physicians contracts out of estimated 85,832 personal service contracts .
To raise KERS retirement system from 61% to 81% funding level over next two bieniums amend KERS retirement legislation language placing all new state employees, including newly locally elected state representatives and senators under defined contribution retirement plans effective January 1, 2008; if legislators’ increase in retirement benefits under HB 389, if legislators do not agree to providing 81% level funding to KERS and County retirement systems over next two bienniums
Save estimated $88 million amending current KY statutes eliminating
70 PVA position---as recommended in 1995 by Commision On Quality &
Efficiency task force---and eliminating following state positions; reducing
all non-merit Director positions to merit with comparable merit pay; eliminate following positions---Special assistants/Executive/Reduce Cabinet Secretaries to Department Commissioners capping salaries @$70,000 annually/Policy AdvisorsReducing Office of the Courts
and Legislative Research Commission staffs by 20% (estimated 160 employees from each staff) saving estimated $10 million using
some savings to train remaining personnel to handle more duties and
responsibilities
Amend retirement legislation to eliminate state and county personnel
“retirement loophole”Generate, enforce clear job duty guidelines addressing any outside
employment---private and/or publicReview and change ways the highway paving contract are bid
Develop Kentucky’s Wood Industry to bring in more tax dollarsAmend legislation to allow substituting one-time payments for across-the-board raises which aren’t added to base salaries for next year’s budget. In addition, the state will not have to contribute up to 7.5% of the bonuses into a retirement account.
Direct Justice and Finance Cabinets to coordingate statewide compliance of titling & registration to locate, identify, assess, bill and collect all
estimated 150,000 motor vehicle tax evading owners owing an estimated $106 million of uncollected usage, property;Owing estimated $20 million of u-drive-it taxes and state registration fees
eliminate cumbersome and unfairly administered $80 million weight-distance tax on trucks recouping $80 million lost revenues enhancing motor fuels tax and truck registration fees
dash@copper.net
Sunday, December 23, 2007
PUBLIC VERSUS PRIVATE PENSIONS
STATE, LOCAL, FEDERAL VERSUS PRIVATE PENSIONS
INDUSTRY SECTOR
An industry Civil Service worker covered by a Defined Benefit retirement plan working 25 years @$50,000 annually retirement would be $8,309.
A Federal worker covered by Defined Benefit retirement plan working 25 years @$50,000 annually would draw estimated $4,681.
PRIVATE SECTOR
Worker covered by defined benefit plan with 25 years @$50,000 retirement would be $2,786.
Worker covered by social security plan with 25 years @$50,000 retirement would be $1,534.
Worker covered by defined contribution with 25 years @$50,000 retirement would be $1,907.
1996-2005 Comparsion of Average Pensions
Pensions 1996 2005 INCREASE OVER 9 YEARS
Private $26,582 $40,505 +34.4%
State $31,397 $42,249 +25.7%
Local $28,320 $37,718 +25.0%
Federal $40,414 $59,864 +32.5%
Source: 2007 AFT Public Employees Compensation Survey: www.bls.gov
INDUSTRY SECTOR
An industry Civil Service worker covered by a Defined Benefit retirement plan working 25 years @$50,000 annually retirement would be $8,309.
A Federal worker covered by Defined Benefit retirement plan working 25 years @$50,000 annually would draw estimated $4,681.
PRIVATE SECTOR
Worker covered by defined benefit plan with 25 years @$50,000 retirement would be $2,786.
Worker covered by social security plan with 25 years @$50,000 retirement would be $1,534.
Worker covered by defined contribution with 25 years @$50,000 retirement would be $1,907.
1996-2005 Comparsion of Average Pensions
Pensions 1996 2005 INCREASE OVER 9 YEARS
Private $26,582 $40,505 +34.4%
State $31,397 $42,249 +25.7%
Local $28,320 $37,718 +25.0%
Federal $40,414 $59,864 +32.5%
Source: 2007 AFT Public Employees Compensation Survey: www.bls.gov
Wednesday, December 19, 2007
State Employee dilemma
How about these suggestions for how to fix the Retirement System's funding problem?
Tom
Why didin't someone on the commission make the following suggestions that they:
1. pay the Legislative Branch and Non-Merit Executive Branch Employees Less,
2. reduce the amount paid on behalf of the Legislature and the Non Merit Executive Branch Employees into the retirement system,
3. not fund any insurance benefits for Legislative and Executive Branch employees,
4. cut the amounts paid to all of those Legislative and Executive Branch employees by 20% and not give them any pay increase until the Retirement Revenue Shortfall has been replaced.
5. Non Merit Employees should not be given state vehicles to drive to and from home as part of their employment incentive package they should have to drive their own vehicles.
6. The Governor should not have an expensive aircraft to fly around in he should have to travel the state's highways like the rest of us and maybe then he' understand why Kentuckians are unhappy with the lack of maintenance on the state's roadways. The aircraft should be sold and the proceeds from the sale should be used to pay off the underpayment of the Retirement Systems for the past 20 plus years. We can't afford a state airplane. There should be a moritorium placed on building any new roads until we the commonwealth of Kentucky can pay to maintain the existing roadways.
7. if in their infinite wisdom they determine to for go annual increments for merit state employees and retirees then the Legislative and Non Merit Executive Branch employees should have their salaries reduced to the entry level amounts paid to the lowest paid state employees, then and only then will they understand the hardship and burdens they have placed on merit state with no hope for an increase in their come. Yes, even the Governor's Office and his staff should be included in the pay reduction!
If they, the Legislative and Non Merit Executive Branch, had been vigilant and prudent with the state's budgeted expenditures they wouldn't have had to short payments to (underfund) the Kentucky Employees Retirement Systems, County Employees Retirement System or Teacher's Retirement Systems to make up for their poor financial judgements.
The state employees did not cause the shortfalll the Executive and Legislative Branches of Government cause it! They are the ones who are responsible not the state's merit employees who work for substandard wages!
Legislature sent plan to solve pension crisis
Wednesday, December 19, 2007
Legislature sent plan to solve pension crisis
Legislature sent plan to solve pension crisis Bonds could help cover shortfall for state retirement funds
By Stephenie Steitzer ssteitzer@courier-journal.com The Courier-Journal
FRANKFORT, Ky. -- Kentucky's public pension crisis can be solved in part by issuing bonds to cover funding shortfalls and giving retirees cost-of-living increases only when the state can pay for them, a special commission decided yesterday.
The 24-member group stayed away from the controversial issue of moving toward a retirement plan for new hires that resembles private 401(k) plans, and it softened its stance on reducing benefits for future workers.
"I think (the report) has lots of substance," said Brian Crall, chairman of the commission that includes business people, union employees, city and county officials, and legislators.
"It addresses financing, it addresses pension benefit changes for new hires, it addresses health-insurance changes that are possible and it addresses governance changes."
Then-Gov. Ernie Fletcher in April appointed the commission to determine how to deal with the $18 billion shortfall and the benefits the state should give to future workers.
Its members debated for more than five hours yesterday before voting on nearly 30 recommendations that will affect 445,000 current and retired state workers.
A final report is expected to be sent to Gov. Steve Beshear and the legislature in time for the 2008 session, which begins Jan. 8.
Business representatives such as David Jones, founder and former chairman of Louisville-based Humana Inc., pushed for recommendations that would greatly reduce benefits for future employees, require more years of service before retirement and move toward a system that puts workers -- not state government -- in charge of saving for retirement.
"I understand these advocates want to keep an incredible cushy deal," Jones said. "But one question that finally has to be asked and answered is, the people who pay the taxes don't have these kinds of benefits, and someone is going to have to step up and deal with this." 401(k) plans not feasible
Charles Wells, executive director of the Kentucky Association of State Employees, said state workers make less than private-sector workers, so 401(k) plans aren't feasible.
"If our state employees, our social workers, our firefighters, our teachers made the kind of salaries that they make at Humana, they might be able to afford to go into a 401(k) plan, and maybe someday they would retire as millionaires," Wells said. "But quite frankly, they don't make those kinds of monies."
The commission ultimately decided not to recommend moving toward a 401(k) plan in part because of the cost of a switch.
Bill Hanes, retired executive director of the Kentucky Retirement Systems, said it would cost nearly $300 million in the first year to change plans. Other nonstarters
The commission also backed away from proposals to drastically reduce benefits for future hires, recommending that the legislature "study strategies" to extend the years of service employees should work before they become eligible for full retirement.
The recommendation originally suggested the legislature create a lower-cost benefit tier for new hires and included specific benefit reductions, such as no automatic cost-of-living adjustments.
Currently, nonhazardous-duty workers with 27 years of service and hazardous-duty workers with 20 years of service can retire with full benefits.
Members representing private industry protested the amendment, saying the commission should present concrete solutions to the legislature, not suggestions for more study.
"Every time something is controversial, we want to just say let's study it and not get up as a commission member and vote on it," said commission member Shawn Ridley of Atlas Brown, a Louisville-based investment firm. "At some point we are going to have to pay the price, pay the piper, and the taxpayers are getting fed up." Ensuring plan 'stability' Commission member Brent McKim, executive director of the Kentucky Education Association, said his organization, which represents 30,000 public-school employees, wants to make sure the pension systems are sustainable in the long run. And he said the commission should have spent more time looking for solutions.
"We are absolutely supportive of ensuring the stability of the plans," he said. "That's why we believe we should have thoroughly evaluated the impact of these changes on the plans and on the ability to retain and attract quality employees. Those sorts of analyses really have not been done."
The commission recommendation for borrowing money did not specify an amount, but Crall has said it could range from $500 million to $1.5 billion.
That's necessary, members say, because the pension system is funded at about 60 percent of the level that financial experts recommended.
During the legislative session earlier this year, the Senate passed a bill that called for borrowing $800 million, but the House wanted more time to study the risks to the state's credit rating.
The commission also recommended the legislature change the way it handles annual cost-of-living-adjustments, which automatically increases the state's obligations, even if the state doesn't put more money into the system.
Last year, for example, the cost-of-living increase was 3.4 percent, adding $309 million in unfunded retirement costs.
The commission directed the legislature to change the law so that it gives cost-of-living adjustments only when the state has the money to pay for them. If the state doesn't have the money, workers would receive little or no cost-of-living increase.
Reporter Stephenie Steitzer can be reached at (502) 875-5136.
Tom
Why didin't someone on the commission make the following suggestions that they:
1. pay the Legislative Branch and Non-Merit Executive Branch Employees Less,
2. reduce the amount paid on behalf of the Legislature and the Non Merit Executive Branch Employees into the retirement system,
3. not fund any insurance benefits for Legislative and Executive Branch employees,
4. cut the amounts paid to all of those Legislative and Executive Branch employees by 20% and not give them any pay increase until the Retirement Revenue Shortfall has been replaced.
5. Non Merit Employees should not be given state vehicles to drive to and from home as part of their employment incentive package they should have to drive their own vehicles.
6. The Governor should not have an expensive aircraft to fly around in he should have to travel the state's highways like the rest of us and maybe then he' understand why Kentuckians are unhappy with the lack of maintenance on the state's roadways. The aircraft should be sold and the proceeds from the sale should be used to pay off the underpayment of the Retirement Systems for the past 20 plus years. We can't afford a state airplane. There should be a moritorium placed on building any new roads until we the commonwealth of Kentucky can pay to maintain the existing roadways.
7. if in their infinite wisdom they determine to for go annual increments for merit state employees and retirees then the Legislative and Non Merit Executive Branch employees should have their salaries reduced to the entry level amounts paid to the lowest paid state employees, then and only then will they understand the hardship and burdens they have placed on merit state with no hope for an increase in their come. Yes, even the Governor's Office and his staff should be included in the pay reduction!
If they, the Legislative and Non Merit Executive Branch, had been vigilant and prudent with the state's budgeted expenditures they wouldn't have had to short payments to (underfund) the Kentucky Employees Retirement Systems, County Employees Retirement System or Teacher's Retirement Systems to make up for their poor financial judgements.
The state employees did not cause the shortfalll the Executive and Legislative Branches of Government cause it! They are the ones who are responsible not the state's merit employees who work for substandard wages!
Legislature sent plan to solve pension crisis
Wednesday, December 19, 2007
Legislature sent plan to solve pension crisis
Legislature sent plan to solve pension crisis Bonds could help cover shortfall for state retirement funds
By Stephenie Steitzer ssteitzer@courier-journal.com The Courier-Journal
FRANKFORT, Ky. -- Kentucky's public pension crisis can be solved in part by issuing bonds to cover funding shortfalls and giving retirees cost-of-living increases only when the state can pay for them, a special commission decided yesterday.
The 24-member group stayed away from the controversial issue of moving toward a retirement plan for new hires that resembles private 401(k) plans, and it softened its stance on reducing benefits for future workers.
"I think (the report) has lots of substance," said Brian Crall, chairman of the commission that includes business people, union employees, city and county officials, and legislators.
"It addresses financing, it addresses pension benefit changes for new hires, it addresses health-insurance changes that are possible and it addresses governance changes."
Then-Gov. Ernie Fletcher in April appointed the commission to determine how to deal with the $18 billion shortfall and the benefits the state should give to future workers.
Its members debated for more than five hours yesterday before voting on nearly 30 recommendations that will affect 445,000 current and retired state workers.
A final report is expected to be sent to Gov. Steve Beshear and the legislature in time for the 2008 session, which begins Jan. 8.
Business representatives such as David Jones, founder and former chairman of Louisville-based Humana Inc., pushed for recommendations that would greatly reduce benefits for future employees, require more years of service before retirement and move toward a system that puts workers -- not state government -- in charge of saving for retirement.
"I understand these advocates want to keep an incredible cushy deal," Jones said. "But one question that finally has to be asked and answered is, the people who pay the taxes don't have these kinds of benefits, and someone is going to have to step up and deal with this." 401(k) plans not feasible
Charles Wells, executive director of the Kentucky Association of State Employees, said state workers make less than private-sector workers, so 401(k) plans aren't feasible.
"If our state employees, our social workers, our firefighters, our teachers made the kind of salaries that they make at Humana, they might be able to afford to go into a 401(k) plan, and maybe someday they would retire as millionaires," Wells said. "But quite frankly, they don't make those kinds of monies."
The commission ultimately decided not to recommend moving toward a 401(k) plan in part because of the cost of a switch.
Bill Hanes, retired executive director of the Kentucky Retirement Systems, said it would cost nearly $300 million in the first year to change plans. Other nonstarters
The commission also backed away from proposals to drastically reduce benefits for future hires, recommending that the legislature "study strategies" to extend the years of service employees should work before they become eligible for full retirement.
The recommendation originally suggested the legislature create a lower-cost benefit tier for new hires and included specific benefit reductions, such as no automatic cost-of-living adjustments.
Currently, nonhazardous-duty workers with 27 years of service and hazardous-duty workers with 20 years of service can retire with full benefits.
Members representing private industry protested the amendment, saying the commission should present concrete solutions to the legislature, not suggestions for more study.
"Every time something is controversial, we want to just say let's study it and not get up as a commission member and vote on it," said commission member Shawn Ridley of Atlas Brown, a Louisville-based investment firm. "At some point we are going to have to pay the price, pay the piper, and the taxpayers are getting fed up." Ensuring plan 'stability' Commission member Brent McKim, executive director of the Kentucky Education Association, said his organization, which represents 30,000 public-school employees, wants to make sure the pension systems are sustainable in the long run. And he said the commission should have spent more time looking for solutions.
"We are absolutely supportive of ensuring the stability of the plans," he said. "That's why we believe we should have thoroughly evaluated the impact of these changes on the plans and on the ability to retain and attract quality employees. Those sorts of analyses really have not been done."
The commission recommendation for borrowing money did not specify an amount, but Crall has said it could range from $500 million to $1.5 billion.
That's necessary, members say, because the pension system is funded at about 60 percent of the level that financial experts recommended.
During the legislative session earlier this year, the Senate passed a bill that called for borrowing $800 million, but the House wanted more time to study the risks to the state's credit rating.
The commission also recommended the legislature change the way it handles annual cost-of-living-adjustments, which automatically increases the state's obligations, even if the state doesn't put more money into the system.
Last year, for example, the cost-of-living increase was 3.4 percent, adding $309 million in unfunded retirement costs.
The commission directed the legislature to change the law so that it gives cost-of-living adjustments only when the state has the money to pay for them. If the state doesn't have the money, workers would receive little or no cost-of-living increase.
Reporter Stephenie Steitzer can be reached at (502) 875-5136.
Monday, December 17, 2007
Kentucky Budget
Reduce Kentucky's Federal Medicaid deficits by obtaining a Federal Medicaid Waiver authorizing all Medicaid eligible seniors Medicaid funding to reside in qualifying assisted living facility! Nursing home care in 2008 costs are estimated in $80,000 annual range while assisted living residence annual costs are in the less-than-$40,000 figures. Assisted living residents assessed as "independent" and/or "assisted" services required live in a private aparment furnished with following services:
3 meals per day/bathing, dressing, grooming, assistance/weekly laundering of bed linens/weekly detailing & daily spot cleaning of apartment/weekly laundry service/daily bed making/maintenance/scheduled transportation/meal delivery, all utilities (excluding phone & cable), 24/7 emergency call bracelets/24/7 emergency button in each room/daily activities & scheduled outings/self-administration of Medication
2008 Assisted living monthly costs in Central Kentucky:
Assessed as Independent Assessed as Assisted Assessed as Extended
Studio @$1800 per month $2,200 $3,000
1 Bedroom @ $2100 per month $2,500
Double studio @ $2,600 per month $3,300 $4,000
Recommended 2008 legislation related to assisted living facilities:
Legislate amelioration clause allowoing fines against ALS, Senior housing to be invested back into facility to improve safety & comfort of residence care
Require ALS media advertisements to display rates for individual rental room rates broken down by assisted-independent-extended services
Require ALS management to provide clients and/or caregivers 30 day notice of rental services price increases.
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