AG Derek Schmidt Statement on Legislation Paying $1.1 Billion in Public Pension Debt
Kansas Attorney General and Republican candidate for Governor Derek Schmidt issued the following statement in connection with the signing into law of Senate Bill 421.
The bill prepays $1.1 billion in debt owed by the state to the Kansas Public Employees Retirement System (KPERS) because of decades of underfunding the state's employer contributions to public pensions.
"Before the legislative session began, I called on the Legislature to prepay at least $1 billion of the state's public pension debt this year. Retiring that debt early is estimated to save taxpayers nearly $100 million per year far into the future. Although the governor's budget did not include this fiscally responsible proposal, senior Republican leaders including Speaker Ron Ryckman and President Ty Masterson stepped up and got the job done. This bold initiative, which retires $1.1 billion in public pension debt, is transformative – for Kansans who rely on state services, for taxpayers who can benefit from future tax relief, and for all the law enforcement officers, firefighters, teachers and other public retirees who rely on KPERS pensions. Kansas needs more of this kind of commonsense conservative leadership that prioritizes the fundamentals of good government, including paying our debts, running government efficiently and minimizing the burden on taxpayers. A penny saved really is a penny earned. The old ways of borrowing from the future to spend more now no longer will do, and I commend all who answered the call to make this happen."
On January 9, 2022, Derek Schmidt called on the Legislature to prepay at least $1 billion of pension debt this year. This initiative contrasts with Laura Kelly's repeated budget recommendations to borrow more from KPERS by "refinancing" payments at a cost to taxpayers of billions in additional debt service, and with her 2019 veto of a more modest proposal to prepay $51 million in KPERS debt.
(Information courtesy AG Derek Schmidt.)