Ft. Wright Lawsuit Against State Pension System Goes to Supreme Court
The City of Fort Wright's class action lawsuit against the board of trustees of the Kentucky Retirement System (KRS) is scheduled to be argued before the Kentucky Supreme Court next month.
The city is seeking restitution and an accounting for what it alleges were improper investments of assets by the board at the County Employees Retirement Systems (CERS).
The city's lawsuit was dismissed by a Franklin Co. judge in 2018, but at the time, Mayor Dave Hatter told The River City News that the city would likely appeal.
The state's highest court will hear oral arguments in the case on August 19 at 11 a.m. The arguments are expected to be streamed on the KET webiste.
In 2020, part of the city's overall goal related to the state pension system for employees of cities and counties was adopted when Gov. Andy Beshear signed into law legislation that creates an independent board of trustees to manage investment decisions, actuarial data, auditing, and asset allocations for the system.
In an announcement, the city said that it believes this legislation, passed in 2020 as House Bill 484, will lead to greater accountability for CERS investments.
Cities across the state have long been critical of the increased payments expected of them to bolster the pension system. Many, including Ft. Wright, had gone on the record calling for a full separation of CERS from Kentucky Employees Retirement Systems (KERS).
In 2017, fourteen Kenton Co. mayors signed an op-ed calling for such a move. In 2020, Covington Mayor Joe Meyer said that pension costs were a threat to the city's future growth.
In Ft. Wright, the pension costs for this current fiscal year are expected to be more than $800,000, more than 16% of the city's general fund budget.
"The purpose of separating CERS from KERS was to ensure the system remains free of political influence, regardless of future administrations, and we continue to express our sincere appreciation to the Kentucky Legislature, especially Senator Chris McDaniel and Representative Kim Banta, for taking the necessary actions to free CERS and hopefully return some stability to the CERS System," the City of Ft. Wright said in a news release.
"The passage of HB 484, was certainly a legislative victory in regards to our case, but only resolved a portion of our claims surrounding the ongoing class action litigation, and the City of Fort Wright continues the pursuit of other non-resolved matters affiliated with the lawsuit during the upcoming oral arguments to be heard at the Kentucky Supreme Court on August 19th. We invite you to tune in."