78.5518 Increase of benefits.
585 words·~3 min read·
/ky/chapter-78/78-5518A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
(1)Effective August 1, 1996, to July 1, 2008, a recipient of a retirement allowance
under KRS 78.510 to 78.852 shall have his or her retirement allowance
increased on July 1 of each year by the percentage increase in the annual
average of the consumer price index for all urban consumers for the most
recent calendar year as published by the federal Bureau of Labor Statistics, not
to exceed five percent (5%). In determining the annual employer contribution
rate, only the cost of increases granted as of the most recent valuation date
shall be recognized. The benefits of this subsection as provided on August 1,
1996, to July 1, 2008, shall not be considered as benefits protected by the
inviolable contract provisions of KRS 78.852. The General Assembly reserves
the right to suspend or reduce the benefits conferred in this subsection if in
their judgment the welfare of the Commonwealth so demands.
(a)Effective July 1, 2009, and on July 1 of each year thereafter, a recipient of
a retirement allowance under KRS 78.510 to 78.852 shall have his or her
retirement allowance increased by one and one-half percent (1.5%), if:
1. The funding level of the pension fund is greater than one hundred
percent (100%) and subsequent legislation authorizes the use of
any surplus actuarial assets to provide an increase in retirement
allowances described by this subsection for the pension fund which
has the surplus actuarial assets; or
2. The General Assembly directs payment of employer contributions to
fully prefund the increase described by this subsection in the year
the increase is provided.
(b)The board of trustees of the system shall, at least thirty
(30)days prior to
the beginning of regular sessions of the General Assembly held in
even-numbered years, advise the General Assembly of the following:
1. Which pension funds have a funding level greater than one hundred
percent (100%) and can support an increase in recipients' retirement
allowances as provided by paragraph
(a)of this subsection over the
next budget biennium without reducing the funding level of the
pension fund below one hundred percent (100%); and
2. If no surplus actuarial assets are available, the level of employer
contribution funds needed to fully prefund an increase for pension
fund recipients over the next budget biennium if a one and one-half
percent (1.5%) increase is provided annually over the biennium.
(c)For purposes of this subsection, "funding level" means the actuarial value
of assets divided by the actuarially accrued liability expressed as a
percentage that is determined and reported by the system's actuary in the
system's actuarial valuation for each pension fund.
(d)The full increase described by this subsection shall only be provided if the
recipient has been receiving a benefit for at least twelve
(12)months prior
to the effective date of the increase. If the recipient has been receiving a
benefit for less than twelve
(12)months prior to the effective date of the
increase provided by this subsection, the increase shall be reduced on a
pro rata basis for each month the recipient has not been receiving
benefits in the twelve
(12)months preceding the effective date of the
increase.
(e)The benefits of this subsection as provided on July 1, 2009, and
thereafter shall not be considered as benefits protected by the inviolable
contract provisions of KRS 78.852. The General Assembly reserves the
right to suspend or reduce the benefits conferred in this subsection if, in
its judgment, the welfare of the Commonwealth so demands.