13RS SB2
LRC Seal

SB2

13RS

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The hyperlink to a bill draft that precedes a summary contains the most recent version (Introduced/GA/Enacted) of the bill. If the session has ended, the hyperlink contains the latest version of the bill at the time of sine die adjournment. Note that the summary pertains to the bill as introduced, which is often different from the most recent version.


SB 2/LM/AA (BR 231) - D. Thayer, J. Bowen, J. Higdon, P. Hornback, C. McDaniel, M. Wilson

     AN ACT relating to retirement.
     Create a new section of KRS 6.500 to 6.577 to require public employers to pay the actuarial costs for increases in final compensation in the Legislators’ Retirement Plan greater than 10% that are attributable to the salaries paid by public employers that affect benefits in the Legislators' Retirement Plan; authorize the Legislators' Retirement Plan to determine the cost to the employer and to establish administrative regulations to administer the provisions of this section; create a new section of KRS 16.505 to 16.652 to establish the hybrid cash balance plan for members of the State Police Retirement System, hazardous members of the Kentucky Employees Retirement System, and hazardous members of the County Employees Retirement System who begin participating in these systems on or after July 1, 2013; provide that the hybrid cash balance plan shall provide a benefit for these members based upon the members' accumulated account balance which shall include member contributions, an employer pay credit of 7.5% of salary, and interest credits on the member contributions and employer pay credits; provide that the annual interest credits in the hybrid cash balance plan for actively contributing members shall be 4% plus 75% of the 5-year average investment returns of the systems net of fees and expenses above 4%; provide an interest credit of 4% for members who are not contributing to the plan but who retain an account balance; provide that upon termination of employment members in the hybrid cash balance plan with less than 5 years of service shall be eligible to take a refund of their accumulated contributions and members in the hybrid cash balance plan with 5 or more years of service shall be eligible to take a refund of their accumulated account balance; provide that members participating in the hybrid cash balance plan shall be eligible to retire at age 60 with at least 5 years of service or at any age with 25 or more years of service; allow a member in the hybrid cash balance plan, upon reaching retirement eligibility, to take a refund of his or her accumulated account balance, to have his or her accumulated account balance annuitized based upon the assumptions set by the system at the member's retirement date, or to take an actuarially reduced annuitized payment under one of the other payment options currently available to all members of the retirement systems; create a new section of KRS 61.510 to 61.705 to establish the hybrid cash balance plan for non-hazardous members of the Kentucky Employees Retirement System and the County Employees Retirement System who begin participating in these systems on or after July 1, 2013; provide that the hybrid cash balance plan shall provide a benefit for these members based upon the members' accumulated account balance which shall include member contributions, an employer pay credit of 4% of salary, and interest credits on the member contributions and employer pay credits; provide that the annual interest credits in the hybrid cash balance plan for actively contributing members shall be 4% plus 75% of the 5-year average investment returns of the systems net of fees and expenses above 4%; provide an interest credit of 4% for members who are not contributing to the plan but who retain an account balance; provide that upon termination of employment members in the hybrid cash balance plan with less than 5 years of service shall be eligible to take a refund of his or her accumulated contributions and members in the hybrid cash balance plan with 5 or more years of service shall be eligible to take a refund of his or her accumulated account balance; provide that members participating in the hybrid cash balance plan shall be eligible to retire at age 65 with at least 5 years of service or if they have a years-of-age and service total of 87 years, with a minimum age of 57; allow a member in the hybrid cash balance plan, upon reaching retirement eligibility, to take a refund of their accumulated account balance, to have their accumulated account balance annuitized based upon the assumptions set by the system at the member's retirement date, or to take an actuarially reduced annuitized payment under one of the other payment options current available to all members of the retirement systems; create a new section of KRS 61.510 to 61.705 to require employers to pay the actuarial cost of increases in compensation greater than 10% earned by the employee during the last 5 fiscal years of employment for employees retiring on or after July 1, 2013, and to allow the system to determine the cost to the employer; create a new section of KRS 61.510 to 61.705 to require the Kentucky Employees Retirement System, the County Employees Retirement System, and the State Police Retirement System, including the hybrid cash balance plans administered within these systems, to comply with federal law benefit maximums governing pension plans and to establish procedures for benefit estimations and adjustments to those benefits upon actual retirement based upon final pay information; amend KRS 6.505 and 21.360 to close the Legislators' Retirement Plan and the Judicial Retirement Plan to new participants effective July 1, 2013; amend KRS 6.521, 21.450, and 61.691 to end the cost-of-living adjustments for members of the Legislators' Retirement Plan, the Judicial Retirement Plan, the Kentucky Employees Retirement System, the County Employees Retirement System, and the State Police Retirement System effective July 1, 2013, and to recognize the suspension of the COLAs in place in the biennial budget; provide that the General Assembly may provide future cost-of-living adjustments if the COLAs are prefunded at the time of enactment; amend KRS 16.197 to require the Trooper R class program to abide by the increased break in employment requirements required by this Act; amend KRS 16.505, 61.510, and 78.510 to define "accumulated employer credit" and "accumulated account balance"; amend KRS 16.555, 16.543, and 78.630 to change the name of the member contribution account in KERS, CERS, and SPRS to the member account; amend 16.560, 61.575, and 78.640 to conform the member account language in KERS, CERS, and SPRS to conform to the new hybrid cash balance plan and to make technical changes; amend KRS 16.565, 61.580, and 78.650 to require the employer pay credits and interest on those credits in the hybrid cash balance plan to be paid from the retirement allowance accounts of KERS, CERS, and SPRS; amend KRS 16.576, 16.577, and 61.559 to provide that the retirement benefit calculations and retirement eligibility provisions under these sections shall not be applicable to members participating in the hybrid cash balance plan on or after July 1, 2013; amend KRS 16.578 and 61.640, regarding death before retirement benefits, to conform to the new hybrid cash balance plan for new members of KERS, CERS, and SPRS; amend KRS 16.582 to provide that new hazardous members of KERS, CERS, and SPRS participating in the hybrid cash balance plan shall receive a disability benefit equal to the higher of the member’s retirement allowance calculated under the hybrid cash balance plan or 25% of the member’s final rate of pay; amend KRS 16.652, 61.692, and 78.852 to limit the inviolable contract for new members who begin participating in the system on or after July 1, 2013, to the benefits accrued and to define benefits accrued for new members as the member’s accumulated account balance; clarify that the General Assembly may continue to have the authority to amend benefits for members participating prior to July 1, 2013, for those benefits the General Assembly had the authority to amend prior to July 1, 2013; amend KRS 61.545, 61.552, 61.555, and 78.540 to remove the purchase of service credit provisions for members who begin participating in KERS, CERS, and SPRS in the hybrid cash balance plan on or after July 1, 2013, with the exception of omitted service, recontributions of refunds, and military service if called to active duty while working; amend KRS 61.546 and 78.616 to remove the additional service credit awarded for accumulated sick leave upon retirement for members who begin participating in KERS, CERS, and SPRS in the hybrid cash balance plan on or after July 1, 2013; amend KRS 61.565 to eliminate the current policy goal, established by HB 1 in 2008, to phase-in to the full actuarially required contribution rates for KERS and SPRS over time and to establish a goal to fully fund the actuarially required contribution for these funds effective with FY 2014-2015; reset the amortization period for the payment of the unfunded liability for KERS, CERS, and SPRS to a new 30-year period to make the resetting of the amortization period contingent upon payment of the full actuarially required contribution; amend KRS 61.592 to remove the ability to convert nonhazardous service to hazardous duty service for members participating in the hybrid cash balance plan on or after July 1, 2013, and to make technical changes; amend KRS 61.595 to provide that the retirement benefit calculations and retirement eligibility provisions under this section shall not be applicable to KERS, CERS, and SPRS members participating in the hybrid cash balance plan on or after July 1, 2013, and to delete language which is re-established in the Act; amend KRS 61.605 to provide that new non-hazardous members of KERS and CERS participating in the hybrid cash balance plan shall receive a disability benefit equal to the higher of the member’s retirement allowance calculated under the hybrid cash balance plan or 20% of the member’s final rate of pay; amend KRS 61.615 to make changes to disability provisions governing discontinuance of benefits and the ability of the recipient to elect “early retirement” since early retirement provisions are no longer applicable to new members participating in the hybrid cash balance plan on or after July 1, 2013; amend KRS 61.625 to make technical and conforming changes and to clarify that a member convicted of a felony related to his or her employment shall still only receive a refund of his or her accumulated contributions; amend KRS 61.635 to eliminate the actuarial equivalent refund option for members participating in the hybrid cash balance plan on or after July 1, 2013, and to remove a retirement allowance payment option specific to legislators; Amend KRS 61.637 to provide that KERS, CERS, and SPRS retirees who are reemployed on or after July 1, 2013, will be required to observe a 2-year break in employment in any position with any employer participating in KERS, CERS, and SPRS, except that members who retire from a hazardous duty position and return to work in a full-time hazardous duty shall be required to observe a 1-year break in employment; require employers to pay employer contributions and health reimbursements on full-time employees who are reemployed on or after July 1, 2013; amend KRS 61.645 to change the KRS board of trustees composition by adding 3 new trustees, including one trustee appointed by the Governor from a list of three individuals recommended by the Kentucky League of Cities, one trustee appointed by the Governor from a list of three individuals recommended by the Kentucky Association of Counties, and one trustee appointed by the Governor from a list of three individuals recommended by the Kentucky School Board Association; remove the trustee appointed by the Governor who must be knowledgeable about the impact of pensions on local governments; require that the two trustees appointed by the Governor with “investment experience” shall not be employed by or retired from an agency participating in KERS, CERS, or SPRS; require the systems to post on their website and make available upon request information regarding the systems' financial and actuarial condition that is easily understood by the members, retired members, and the public; amend KRS 78.530 to remove the alternate participation plan, which allows the agency purchases of past service for the member, for new agencies who join CERS; amend KRS 16.165, KRS 16.601, 16.645, 18A.205 61.621, 61.535, 61.690, and 78.45 to conform; provide noncodified language to affirm that the COLA for July 1, 2012, and July 1,2013, for LRP, JRP, KERS, CERS, and SPRS that was suspended by the biennial branch budgets will continue to be suspended notwithstanding the provisions of this Act; provide noncodified language requiring that the KRS trustee appointed by the Governor based upon his or her knowledge of the impact of pensions on local governments shall be replaced by the person appointed by the Governor from a list of 3 individuals submitted by the Kentucky League of Cities as provided by this Act; EFFECTIVE July 1, 2013.

SB 2 - AMENDMENTS


     SFA (1, D. Thayer) - Retain original provisions of the bill; make technical correction.
     HCS/LM/AA - Delete original provisions; Create a new section of KRS 61.510 to 61.705 to provide that for members of the Kentucky Employees Retirement System (KERS), County Employees Retirement System (CERS), and State Police Retirement System (SPRS) who begin participating in the systems on or after July 1, 2013, the General Assembly reserves the right to amend the employee contribution rate on a prospective basis, the benefit factor on a prospective basis, and the retirement eligibility requirements; make the change in the employee contribution rate contingent upon recommendation of the Public Pension Oversight Board created by this bill; create a new section of KRS 61.510 to 61.705 to require KERS, CERS, and SPRS employers to pay the actuarial cost of increases in compensation greater than 10% earned by the employee during the last 5 fiscal years of employment if the increase is not due to a “bona fide promotion or career advancement”; define bona fide promotion or career advancement; establish appeal process for employers aggrieved by a decision of the systems under this section; require systems to make a binding decision for employers as to whether or not a decision will be considered a bona fide promotion or career advancement; allow employers to pay costs over 1 year; create new sections of KRS Chapter 7A to establish the Public Pensions Oversight Board to review, analyze, and provide oversight to the General Assembly on the benefits, administration, investments, funding, laws and regulations, and any legislative proposals relating to the Kentucky Retirement Systems; establish commission membership, authority, and duties; amend KRS 16.577 to require that new SPRS and new hazardous members of KERS and CERS who begin participating in the systems on or after July 1, 2013, are eligible to retire prior to normal retirement age with no penalties upon reaching age 50 with at least 25 years of service; amend KRS 61.565 to eliminate the current policy goal, established by HB 1 in 2008, to phase-in to the full actuarially required contribution rates for KERS and SPRS over time and to establish a new policy goal to require the General Assembly to fully fund the actuarially required contribution for these funds effective with FY 2014-2015; reset the amortization period for the payment of the unfunded liability for KERS, CERS, and SPRS to a new 30-year period to make the resetting of the KERS and SPRS amortization period contingent upon payment of the full actuarially required contribution; amend KRS 61.637 to provide that KERS, CERS, and SPRS retirees who are reemployed on or after July 1, 2014, will be required to observe a 1-year break in employment in any position with any employer participating in KERS, CERS, and SPRS, except that members who return to work in a Trooper R class position, a full-time hazardous duty position, a full-time position that is required to be POPs certified, a position that is not considered regular full-time for retirement purposes, or a position at a local school board for less than 80 days per school year, are required to observe a 1-month break in employment; require employers to pay employer contributions and health reimbursements on full-time employees who are reemployed on or after July 1, 2014; amend KRS 61.645 to change the KRS board of trustees composition by adding 5 new trustees, including 1 trustee appointed by the Governor from a list of 3 individuals recommended by the Kentucky League of Cities, 1 trustee appointed by the Governor from a list of 3 individuals recommended by the Kentucky Association of Counties, 1 trustee appointed by the Governor from a list of 3 individuals recommended by the Kentucky School Board Association, 1 additional trustee elected by the KERS membership, and 1 additional trustee elected by the CERS membership; remove the trustee appointed by the Governor who must be knowledgeable about the impact of pensions on local governments; prohibit the 2 trustees appointed by the Governor with “investment experience” from being employed by or retired from an agency participating in KERS, CERS, or SPRS; require the systems to post on their website and make available upon request information regarding the systems' financial and actuarial condition that is easily understood by the members, retired members, and the public; require the systems to comply with requirements of Public Pension Oversight Board; make conforming amendments; amend KRS 61.691 to provide cost-of-living adjustments for members of KERS, CERS, and SPRS if surplus retirement funds are available and subsequent legislation authorizes the use of those surplus funds or if the General Assembly prefunds the cost-of-living adjustments in the year in which it is provided; require the systems to advise the General Assembly prior to each budget biennium if systems assets are sufficient to fund a COLA without damaging the actuarial soundness of the systems and the costs of providing a prefunded COLA of 1.5% over the biennium; amend 16.645, 18A.205, and 78.545 to conform; provide noncodified language to affirm that the COLA for July 1, 2012, and July 1,2013, for KERS, CERS, and SPRS that was suspended by the biennial branch budgets will continue to be suspended notwithstanding the provisions of this bill; provide noncodified language requiring the KRS trustee appointed by the Governor based upon his or her knowledge of the impact of pensions on local governments, to be replaced by the person appointed by the Governor from a list of 3 individuals submitted by the Kentucky League of Cities as provided by this bill; provide noncodified language to require Kentucky Retirement Systems, within 30 days of the effective date of this bill, to notify members of KERS and CERS that trustees from each group will be elected and to require that these trustees will be elected no later than November 1, 2013.
     HCA (1/Title, B. Yonts) - Make title amendment.
     HFA (1, J. Hoover) - Amend to delete the provisions of SB 2/HCS1 and replace with language that will create a new section of KRS 6.500 to 6.577 to require public employers to pay the actuarial costs for increases in final compensation in the Legislators’ Retirement Plan greater than 10% that are attributable to the salaries paid by public employers that affect benefits in the Legislators' Retirement Plan; authorize the Legislators' Retirement Plan to determine the cost to the employer and to establish administrative regulations to administer the provisions of this section; create a new section of KRS 16.505 to 16.652 to establish the hybrid cash balance plan for members of the State Police Retirement System, hazardous members of the Kentucky Employees Retirement System, and hazardous members of the County Employees Retirement System who begin participating in these systems on or after July 1, 2013; require that the hybrid cash balance plan provide a benefit for these members based upon the members' accumulated account balance which includes member contributions, an employer pay credit of 7.5% of salary, and interest credits on the member contributions and employer pay credits; require the annual interest credits in the hybrid cash balance plan for actively contributing members to be 4% plus 75% of the 5-year average investment returns of the systems net of fees and expenses above 4%; provide an interest credit of 4% for members who are not contributing to the plan but who retain an account balance; require that, upon termination of employment, members in the hybrid cash balance plan with less than 5 years of service are eligible to take a refund of their accumulated contributions and members in the hybrid cash balance plan with 5 or more years of service are eligible to take a refund of their accumulated account balance; require that members participating in the hybrid cash balance plan are eligible to retire at age 60 with at least 5 years of service or at any age with 25 or more years of service; allow a member in the hybrid cash balance plan, upon reaching retirement eligibility, to take a refund of his or her accumulated account balance, to have his or her accumulated account balance annuitized based upon the assumptions set by the system at the member's retirement date, or to take an actuarially reduced annuitized payment under one of the other payment options currently available to all members of the retirement systems; create a new section of KRS 61.510 to 61.705 to establish the hybrid cash balance plan for non-hazardous members of the Kentucky Employees Retirement System and the County Employees Retirement System who begin participating in these systems on or after July 1, 2013; require that the hybrid cash balance plan to provide a benefit for these members based upon the members' accumulated account balance which includes member contributions, an employer pay credit of 4% of salary, and interest credits on the member contributions and employer pay credits; require that the annual interest credits in the hybrid cash balance plan for actively contributing members to be 4% plus 75% of the 5-year average investment returns of the systems net of fees and expenses above 4%; provide an interest credit of 4% for members who are not contributing to the plan but who retain an account balance; require that upon termination of employment, members in the hybrid cash balance plan with less than 5 years of service are eligible to take a refund of his or her accumulated contributions and members in the hybrid cash balance plan with 5 or more years of service are eligible to take a refund of his or her accumulated account balance; require that members participating in the hybrid cash balance plan are eligible to retire at age 65 with at least 5 years of service or if they have a years-of-age and service total of 87 years, with a minimum age of 57; allow a member in the hybrid cash balance plan, upon reaching retirement eligibility, to take a refund of their accumulated account balance, to have their accumulated account balance annuitized based upon the assumptions set by the system at the member's retirement date, or to take an actuarially reduced annuitized payment under one of the other payment options current available to all members of the retirement systems; create a new section of KRS 61.510 to 61.705 to require employers to pay the actuarial cost of increases in compensation greater than 10% earned by the employee during the last 5 fiscal years of employment for employees retiring on or after July 1, 2013, and to allow the system to determine the cost to the employer; create a new section of KRS 61.510 to 61.705 to require the Kentucky Employees Retirement System, the County Employees Retirement System, and the State Police Retirement System, including the hybrid cash balance plans administered within these systems, to comply with federal law benefit maximums governing pension plans and to establish procedures for benefit estimations and adjustments to those benefits upon actual retirement based upon final pay information; amend KRS 6.505 and 21.360 to close the Legislators' Retirement Plan and the Judicial Retirement Plan to new participants effective July 1, 2013; amend KRS 6.521, 21.450, and 61.691 to end the cost-of-living adjustments for members of the Legislators' Retirement Plan, the Judicial Retirement Plan, the Kentucky Employees Retirement System, the County Employees Retirement System, and the State Police Retirement System effective July 1, 2013, and to recognize the suspension of the COLAs in place in the biennial budget; authorize that the General Assembly to provide future cost-of-living adjustments if the COLAs are prefunded at the time of enactment; amend KRS 16.197 to require the Trooper R class program to abide by the increased break in employment requirements required by this bill; amend KRS 16.505, 61.510, and 78.510 to define "accumulated employer credit" and "accumulated account balance"; amend KRS 16.555, 16.543, and 78.630 to change the name of the member contribution account in KERS, CERS, and SPRS to the member account; amend 16.560, 61.575, and 78.640 to conform the member account language in KERS, CERS, and SPRS to conform to the new hybrid cash balance plan and to make technical changes; amend KRS 16.565, 61.580, and 78.650 to require the employer pay credits and interest on those credits in the hybrid cash balance plan to be paid from the retirement allowance accounts of KERS, CERS, and SPRS; amend KRS 16.576, 16.577, and 61.559 to provide that the retirement benefit calculations and retirement eligibility provisions under these sections shall are not applicable to members participating in the hybrid cash balance plan on or after July 1, 2013; amend KRS 16.578 and 61.640, regarding death before retirement benefits, to conform to the new hybrid cash balance plan for new members of KERS, CERS, and SPRS; amend KRS 16.582 to require that new hazardous members of KERS, CERS, and SPRS participating in the hybrid cash balance plan will receive a disability benefit equal to the higher of the member’s retirement allowance calculated under the hybrid cash balance plan or 25% of the member’s final rate of pay; amend KRS 16.652, 61.692, and 78.852 to limit the inviolable contract for new members who begin participating in the system on or after July 1, 2013, to the benefits accrued and to define benefits accrued for new members as the member’s accumulated account balance; clarify that the General Assembly continues to have the authority to amend benefits for members participating prior to July 1, 2013, for those benefits the General Assembly had the authority to amend prior to July 1, 2013; amend KRS 61.545, 61.552, 61.555, and 78.540 to remove the purchase of service credit provisions for members who begin participating in KERS, CERS, and SPRS in the hybrid cash balance plan on or after July 1, 2013, with the exception of omitted service, recontributions of refunds, and military service if called to active duty while working; amend KRS 61.546 and 78.616 to remove the additional service credit awarded for accumulated sick leave uponretirement for members who begin participating in KERS, CERS, and SPRS in the hybrid cash balance plan on or after July 1, 2013; amend KRS 61.565 to eliminate the current policy goal, established by HB 1 in 2008, to phase-in to the full actuarially required contribution rates for KERS and SPRS over time and to establish a goal to fully fund the actuarially required contribution for these funds effective with FY 2014-2015; reset the amortization period for the payment of the unfunded liability for KERS, CERS, and SPRS to a new 30-year period to make the resetting of the amortization period contingent upon payment of the full actuarially required contribution; amend KRS 61.592 to remove the ability to convert nonhazardous service to hazardous duty service for members participating in the hybrid cash balance plan on or after July 1, 2013, and to make technical changes; amend KRS 61.595 to provide that the retirement benefit calculations and retirement eligibility provisions under this section are applicable to KERS, CERS, and SPRS members participating in the hybrid cash balance plan on or after July 1, 2013, and to delete language which is re-established in the bill; amend KRS 61.605 to provide that new non-hazardous members of KERS and CERS participating in the hybrid cash balance plan will receive a disability benefit equal to the higher of the member’s retirement allowance calculated under the hybrid cash balance plan or 20% of the member’s final rate of pay; amend KRS 61.615 to make changes to disability provisions governing discontinuance of benefits and the ability of the recipient to elect “early retirement” since early retirement provisions are no longer applicable to new members participating in the hybrid cash balance plan on or after July 1, 2013; amend KRS 61.625 to make technical and conforming changes and to clarify that a member convicted of a felony related to his or her employment will still only receive a refund of his or her accumulated contributions; amend KRS 61.635 to eliminate the actuarial equivalent refund option for members participating in the hybrid cash balance plan on or after July 1, 2013, and to remove a retirement allowance payment option specific to legislators; Amend KRS 61.637 to provide that KERS, CERS, and SPRS retirees who are reemployed on or after July 1, 2013, will be required to observe a 2-year break in employment in any position with any employer participating in KERS, CERS, and SPRS, except that members who retire from a hazardous duty position and return to work in a full-time hazardous duty are required to observe a 1-year break in employment; require employers to pay employer contributions and health reimbursements on full-time employees who are reemployed on or after July 1, 2013; amend KRS 61.645 to change the KRS board of trustees composition by adding 3 new trustees, including 1 trustee appointed by the Governor from a list of 3 individuals recommended by the Kentucky League of Cities, 1 trustee appointed by the Governor from a list of 3 individuals recommended by the Kentucky Association of Counties, and 1 trustee appointed by the Governor from a list of 3 individuals recommended by the Kentucky School Board Association; remove the trustee appointed by the Governor who must be knowledgeable about the impact of pensions on local governments; prohibit the 2 trustees appointed by the Governor with “investment experience” from being employed by or retired from an agency participating in KERS, CERS, or SPRS; require the systems to post on their Web site, and make available upon request, information regarding the systems' financial and actuarial condition that is easily understood by the members, retired members, and the public; amend KRS 78.530 to remove the alternate participation plan, which allows the agency purchases of past service for the member, for new agencies who join CERS; amend KRS 16.165, KRS 16.601, 16.645, 18A.205 61.621, 61.535, 61.690, and 78.45 to conform; provide noncodified language to affirm that the COLA for July 1, 2012, and July 1, 2013, for LRP, JRP, KERS, CERS, and SPRS that was suspended by the biennial branch budgets will continue to be suspended notwithstanding the provisions of this bill; provide noncodified language requiring the KRS trustee appointed by the Governor, based upon his or her knowledge of the impact of pensions on local governments, to be replaced by the person appointed by the Governor from a list of 3 individuals submitted by the Kentucky League of Cities as provided by this bill; EFFECTIVE July 1, 2013.
     CCR - Cannot agree.
     FCCR - Create new sections of KRS Chapter 7A to establish the Public Pensions Oversight Board to review, analyze, and provide oversight to the General Assembly on the benefits, administration, investments, funding, laws and regulations, and any legislative proposals relating to the Kentucky Retirement Systems; establish commission membership, authority, and duties; create a new section of KRS 16.505 to 16.652 to establish the hybrid cash balance plan for members of the State Police Retirement System, hazardous members of the Kentucky Employees Retirement System, and hazardous members of the County Employees Retirement System who begin participating in these systems on or after January 1, 2014; provide that the hybrid cash balance plan shall provide a benefit for these members based upon the members' accumulated account balance which shall include member contributions, an employer pay credit of 7.5% of salary, and interest credits on the member contributions and employer pay credits; provide that the annual interest credits in the hybrid cash balance plan for actively contributing members shall be 4% plus 75% of the 5-year geometric average investment returns of the systems net of fees and expenses above 4%; provide an interest credit of 4% for members who are not contributing to the plan but who retain an account balance; provide that upon termination of employment members in the hybrid cash balance plan with less than 5 years of service shall be eligible to take a refund of their accumulated contributions and members in the hybrid cash balance plan with 5 or more years of service shall be eligible to take a refund of their accumulated account balance; provide that members participating in the hybrid cash balance plan shall be eligible to retire at age 60 with at least 5 years of service or at any age with 25 or more years of service; allow a member in the hybrid cash balance plan, upon reaching retirement eligibility, to take a refund of his or her accumulated account balance, to have his or her accumulated account balance annuitized based upon the assumptions set by the system at the member's retirement date, or to take an actuarially reduced annuitized payment under one of the other payment options currently available to all members of the retirement systems; create a new section of KRS 61.510 to 61.705 to establish the hybrid cash balance plan for non-hazardous members of the Kentucky Employees Retirement System and the County Employees Retirement System who begin participating in these systems on or after January 1, 2014; provide that the hybrid cash balance plan shall provide a benefit for these members based upon the members' accumulated account balance which shall include member contributions, an employer pay credit of 4% of salary, and interest credits on the member contributions and employer pay credits; provide that the annual interest credits in the hybrid cash balance plan for actively contributing members shall be 4% plus 75% of the 5-year geometric average investment returns of the systems net of fees and expenses above 4%; provide an interest credit of 4% for members who are not contributing to the plan but who retain an account balance; provide that upon termination of employment members in the hybrid cash balance plan with less than 5 years of service shall be eligible to take a refund of his or her accumulated contributions and members in the hybrid cash balance plan with 5 or more years of service shall be eligible to take a refund of his or her accumulated account balance; provide that members participating in the hybrid cash balance plan shall be eligible to retire at age 65 with at least 5 years of service or if they have a years-of-age and service total of 87 years, with a minimum age of 57; allow a member in the hybrid cash balance plan, upon reaching retirement eligibility, to take a refund of their accumulated account balance, to have their accumulated account balance annuitized based upon the assumptions set by the system at the member's retirement date, or to take an actuarially reduced annuitized payment under one of the other payment options current available to all members of the retirement systems; create a new section of KRS 61.510 to 61.705 to require KERS, CERS, and SPRS employers to pay the actuarial cost of increases in compensation greater than 10% earned by the employee during the last 5 fiscal years of employment if the increase is not due to a “bona fide promotion or career advancement”; define bona fide promotion or career advancement; establish appeal process for employers aggrieved by a decision of the systems under this section; require systems to make a binding decision for employers as to whether or not a decision will be considered a bona fide promotion or career advancement; allow employers to pay costs over 1 year; exempt compensatory payments from employer cost calculation; create a new section of KRS 61.510 to 61.705 to require the Kentucky Employees Retirement System, the County Employees Retirement System, and the State Police Retirement System, including the hybrid cash balance plans administered within these systems, to comply with federal law benefit maximums governing pension plans and to establish procedures for benefit estimations and adjustments to those benefits upon actual retirement based upon final pay information; create a new section of KRS 21.345 to 21.580 to establish the hybrid cash balance plan for members of the Legislators’ Retirement Plan and the Judicial Retirement Plan who begin participating in these systems on or after January 1, 2014; provide that the hybrid cash balance plan shall provide a benefit for these members based upon the members' accumulated account balance which shall include member contributions, an employer pay credit of 4% of salary, and interest credits on the member contributions and employer pay credits; provide that the annual interest credits in the hybrid cash balance plan for actively contributing members shall be 4% plus 75% of the 5-year geometric average investment returns of the systems net of fees and expenses above 4%; provide an interest credit of 4% for members who are not contributing to the plan but who retain an account balance; provide that upon termination of employment members in the hybrid cash balance plan with less than 5 years of service shall be eligible to take a refund of his or her accumulated contributions and members in the hybrid cash balance plan with 5 or more years of service shall be eligible to take a refund of his or her accumulated account balance; provide that members participating in the hybrid cash balance plan shall be eligible to retire at age 65 with at least 5 years of service or if they have a years-of-age and service total of 87 years, with a minimum age of 57; allow a member in the hybrid cash balance plan, upon reaching retirement eligibility, to take a refund of their accumulated account balance, to have their accumulated account balance annuitized based upon the assumptions set by the system at the member's retirement date, or to take an actuarially reduced annuitized payment under one of the other payment options current available to all members of the retirement systems; amend KRS 6.505 to limit the inviolable contract for new members who begin participating in the Legislators’ Retirement Plan on or after January 1, 2014, to the benefits accrued and to define benefits accrued for new members as the member’s accumulated account balance; clarify that the General Assembly may continue to have the authority to amend benefits for members participating prior to January 1, 2014, for those benefits the General Assembly had the authority to amend prior to the effective date of the Act; modify the employee contribution rate to the Legislators’ Retirement Plan for those members who begin participating in the plan on or after January 1, 2014, to have 5% dedicated towards funding pension benefits and 1% dedicated towards funding retiree health benefits; provide that a recontribution of a refund for legislative service in KERS that is purchased in the Legislative Retirement Plan on or after January 1, 2014, shall not be used to determine the member’s participation date in the plan; amend KRS 6.515 and 21.370 to remove service purchase provisions for members of the Legislators’ Retirement Plan and the Judicial Retirement Plan who begin participation in the plans on or after January 1, 2014; amend KRS 6.520 and 21.400 to provide that these sections shall not apply to members who begin participating in the Legislators’ Retirement Plan or the Judicial Retirement Plan on or after January 1, 2014; amend KRS 6.521, 21.450, and 61.691 to provide that cost-of-living adjustments for members of the Legislators' Retirement Plan, the Judicial Retirement Plan, the Kentucky Employees Retirement System, the County Employees Retirement System, and the State Police Retirement System shall be provided if the individual system or plan has a funding level greater than 100% and subsequent legislation authorizes the use of the surplus funds to provide a COLA or the General Assembly appropriates sufficient funds or directs the payment of funds to fully prefund the COLA in the year it is provided; require the system to advise the General Assembly 30 days prior to even numbered sessions as to whether or not a system/plan has surplus assets to fund a COLA and the amount needed to prefund a COLA over the biennium if no surplus funds are available; amend KRS 6.525 to cross-reference the hybrid cash balance plan and definitions applicable to the hybrid cash balance plan for new members of the Legislators’ Retirement Plan; make conforming amendments to reciprocity provisions for new members in the Legislators’ Retirement Plan; amend KRS 6.577 and 21.427 to provide that members of the Legislators’ Retirement Plan and the Judicial Retirement Plan who begin participating in the plans on or after January 1, 2014, shall receive a retiree health benefit of $10 per month for each year of service credit which increases by 1.5% annually; provide that the member must have at least 180 months of service credit to be eligible for the insurance benefits under this section and provide exceptions for disability and death in the line of duty benefits; make technical and conforming amendments; clarify that no spouse, dependent, or beneficiary of a member who began participating in the Legislators’ Retirement Plan or Judicial Retirement Plan on or after January 1, 2014, shall receive a subsidy for health benefits except in the case of in the line of duty death; amend KRS 21.345 to define accumulated contributions, accumulated account balance, and accumulated employer credit; amend KRS 21.360 to modify the employee contribution rate to the Judicial Retirement Plan for those members who begin participating in the plan on or after January 1, 2014, to have 5% dedicated towards funding pension benefits and 1% dedicated towards funding retiree health benefits; amend KRS 21.380 to set the normal retirement age for a member who began participating in the Legislators’ Retirement Plan or Judicial Retirement Plan on or after January 1, 2014, to age 65 with no adjustments; amend KRS 21.385 to make conforming amendments; amend KRS 21.410 to provide that a member who began participating in the Legislators’ Retirement Plan or Judicial Retirement Plan on or after January 1, 2014, shall receive a disability benefit that is the higher of 20% of the member’s final rate of pay or the member’s actual benefit at his or her normal retirement date based upon his or her accumulated account balance in the hybrid cash balance plan; amend KRS 21.420 to establish death before retirement and death after retirement benefits for surviving spouses, dependent children, and beneficiaries of members who begin participating in the Legislators’ Retirement Plan or Judicial Retirement Plan on or after January 1, 2014; amend KRS 21.425 to remove dependent child benefit provisions under this section for members who begin participating in the Legislators’ Retirement Plan or Judicial Retirement Plan on or after January 1, 2014; amend KRS 21.460 to provide that members who begin participating in the Legislators’ Retirement Plan or Judicial Retirement Plan on or after January 1, 2014, may take a refund or their accumulated contributions or accumulated account balance upon termination of employment; amend KRS 21.480 to limit the inviolable contract for new members who begin participating in the Judicial Retirement Plan on or after January 1, 2014, to the benefits accrued and to define benefits accrued for new members as the member’s accumulated account balance; clarify that the General Assembly may continue to have the authority to amend benefits for members participating prior to January 1, 2014, for those benefits the General Assembly had the authority to amend prior to the effective date of this Act; amend KRS 21.525 to provide that the hybrid cash balance plans shall operate as another benefit tier with the Legislators’ Retirement Plan and the Judicial Retirement Plan; amend KRS 16.505, 61.510, and 78.510 to define "accumulated employer credit" and "accumulated account balance"; amend KRS 16.555, 16.543, 61.570 and 78.630 to change the name of the member contribution account in KERS, CERS, and SPRS to the member account; amend 16.560, 61.575, and 78.640 to conform the member account language in KERS, CERS, and SPRS to the new hybrid cash balance plan and to make technical changes; amend KRS 16.565, 61.580, and 78.650 to require the employer pay credits and interest on those credits in the hybrid cash balance plan to be paid from the retirement allowance accounts of KERS, CERS, and SPRS; amend KRS 16.576, 16.577, and 61.559 to provide that the retirement benefit calculations and retirement eligibility provisions under these sections shall not be applicable to members participating in the hybrid cash balance plan on or after January 1, 2014; amend KRS 16.578 and 61.640, regarding death before retirement benefits, to conform to the new hybrid cash balance plan for new members of KERS, CERS, and SPRS; amend KRS 16.582 to provide that new hazardous members of KERS, CERS, and SPRS participating in the hybrid cash balance plan shall receive a disability benefit equal to the higher of the member’s retirement allowance calculated under the hybrid cash balance plan or 25% of the member’s final rate of pay; amend KRS 16.652, 61.692, and 78.852 to limit the inviolable contract for new members who begin participating in the system on or after January 1, 2014, to the benefits accrued and to define benefits accrued for new members as the member’s accumulated account balance; clarify that the General Assembly may continue to have the authority to amend benefits for members participating prior to January 1, 2014, for those benefits the General Assembly had the authority to amend prior to the effective date of this Act; amend KRS 61.545, 61.552, 61.555, and 78.540 to remove the purchase of service credit provisions for members who begin participating in KERS, CERS, and SPRS in the hybrid cash balance plan on or after January 1, 2014, with the exception of omitted service, recontributions of refunds, and military service if called to active duty while working; amend KRS 61.546 and 78.616 to remove the additional service credit awarded for accumulated sick leave upon retirement for members who begin participating in KERS, CERS, and SPRS in the hybrid cash balance plan on or after January 1, 2014; amend KRS 61.565 to eliminate the current policy goal, established by HB 1 in 2008, to phase-in to the full actuarially required contribution rates for KERS and SPRS over time and to require employers to fully fund the actuarially required contribution for these funds effective with FY 2014-2015; reset the amortization period for the payment of the unfunded liability for KERS, CERS, and SPRS to a new 30-year period; requires the systems to determine a biennial employer rate for KERS and SPRS effective July 1, 2014; amend KRS 61.592 to remove the ability to convert nonhazardous service to hazardous duty service for members participating in the hybrid cash balance plan on or after January 1, 2014, and to make technical changes; amend KRS 61.595 to provide thatthe retirement benefit calculations and retirement eligibility provisions under this section shall not be applicable to KERS, CERS, and SPRS members participating in the hybrid cash balance plan on or after January 1, 2014, and to delete language which is re-established in the Act; amend KRS 61.605 to provide that new non-hazardous members of KERS and CERS participating in the hybrid cash balance plan shall receive a disability benefit equal to the higher of the member’s retirement allowance calculated under the hybrid cash balance plan or 20% of the member’s final rate of pay; amend KRS 61.615 to make changes to disability provisions governing discontinuance of benefits and the ability of the recipient to elect “early retirement” since early retirement provisions are no longer applicable to new members participating in the hybrid cash balance plan on or after January 1, 2014; amend KRS 61.625 to make technical and conforming changes and to clarify that a member convicted of a felony related to his or her employment shall still only receive a refund of his or her accumulated contributions; amend KRS 61.635 to eliminate the actuarial equivalent refund option for members participating in the hybrid cash balance plan on or after January 1, 2014, and to remove a retirement allowance payment option specific to legislators; amend KRS 61.645 to change the KRS board of trustees composition by adding 4 new trustees, including one additional CERS trustee, one trustee appointed by the Governor from a list of three individuals recommended by the Kentucky League of Cities, one trustee appointed by the Governor from a list of three individuals recommended by the Kentucky Association of Counties, and one trustee appointed by the Governor from a list of three individuals recommended by the Kentucky School Board Association; make conforming amendments; require the systems to post on their website and make available upon request information regarding the systems' financial and actuarial condition that is easily understood by the members, retired members, and the public; amend KRS 61.680 to provide that members who begin participating in the hybrid cash balance plan in KERS, CERS, and SPRS on or after January 1, 2014, shall be able to utilize reciprocity provisions; amend KRS 78.530 to remove the alternate participation plan, which allows the agency purchases of past service for the member and the ability of new agencies to join CERS under the alternate participation where they purchase service for members; amend KRS 61.546 and 78.616 to remove sick leave service credit provisions for members who begin participating in the hybrid cash balance plan in KERS, CERS, and SPRS on or after January 1, 2014; amend KRS 16.165, KRS 16.601, 16.645, 61.621, 61.535, 61.650, 61.690, 78.540, and 78.545 to conform; provide noncodified language to affirm that the COLA for July 1, 2012, and July 1,2013, for LRP, JRP, KERS, CERS, and SPRS that was suspended by the biennial branch budgets will continue to be suspended notwithstanding the provisions of this Act; provide noncodified language requiring Kentucky Retirement Systems to notify CERS members of the new CERS trustee position and to ensure the trustee position is filled no later than November 1, 2013; EFFECTIVE July 1, 2013.

     Feb 5-introduced in Senate; to State & Local Government (S); taken from State & Local Government (S); 1st reading; returned to State & Local Government (S)
     Feb 6-reported favorably, 2nd reading, to Rules; posted for passage in the Regular Orders of the Day for Thursday, February 7, 2013; floor amendment (1) filed
     Feb 7-3rd reading, passed 33-5 with floor amendment (1)
     Feb 8-received in House
     Feb 12-to State Government (H)
     Feb 19-posted in committee
     Feb 22-taken from State Government (H); 1st reading; returned to State Government (H)
     Feb 25-taken from State Government (H); 2nd reading; returned to State Government (H)
     Feb 26-reported favorably, to Rules with Committee Substitute, committee amendment (1-title) ; floor amendment (1) filed to Committee Substitute
     Feb 27-taken from Rules; placed in the Orders of the Day for Wednesday, February 27, 2013; 3rd reading, passed 55-45 with Committee Substitute, committee amendment (1-title)
     Feb 28-received in Senate; posted for passage for concurrence in House Committee Substitute, committee amendment (1-title) ; Senate refused to concur in House Committee Substitute, committee amendment (1-title)
     Mar 1-Not accepted in House (failure to comply with KRS 6.350; lack of possession by Senate when it refused to concur)
     Mar 25-Conference Committee appointed in Senate; received in House
     Mar 26-posted for passage for receding from House Committee Substitute, committee amendment (1-title) ; House refused to recede from Committee Substitute, committee amendment (1) ; Conference Committee appointed in House; Conference Committee report filed in House and Senate; Conference Committee report adopted in House and Senate; Free Conference Committee appointed in House and Senate; Free Conference Committee report filed in House and Senate; received in Senate; posted for passage for consideration of Free Conference Report ; Free Conference Committee report adopted in Senate; passed 32-6; received in House; posted for passage for consideration of Free Conference Report ; Free Conference Committee report adopted in House; Bill passed 70-28; received in Senate; enrolled, signed by each presiding officer; delivered to Governor
     Apr 4-signed by Governor (Acts Chapter 120)

Vote History
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