2013 Kentucky Revised Statutes CHAPTER 6 - THE GENERAL ASSEMBLY 6.505 Election to participate -- Amendment of benefits and rights -- Contribution -- Effect on membership in other retirement plans -- Repurchase of Kentucky Employees Retirement System credit lost by refund.
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6.505 Election to participate -- Amendment of benefits and rights -Contribution -- Effect on membership in other retirement plans -Repurchase of Kentucky Employees Retirement System credit lost by
refund.
(1)
(a)
Each legislator in office on July 1, 1980, may within thirty (30) days after
that date, and any legislator thereafter taking office may within thirty (30)
days after the date thereof, elect to make monthly contributions to the
Legislators' Retirement Plan, in an amount equal to five percent (5%) of
his monthly creditable compensation, as defined in KRS 61.510(13). The
election shall be effective to establish membership in the plan as of July
1, 1980, or as of the date from which the thirty (30) day period is
measured, as the case may be. Provided, however, that any legislator
who was in office on July 1, 1980, and who is in office at the time he
makes the election may, after the expiration of the thirty (30) day period
and until May 1, 1982, make the election, in which event he shall pay to
the Legislators' Retirement Plan, for the months between July 1, 1980,
and the date of his election such sum as, when added to any member's
contribution by him that is transferred from another retirement system
under KRS 6.535, will equal the member's contribution required by this
section. If the member makes his election after February 1, 1981, he shall
in addition pay to the plan interest on the foregoing sum, at six percent
(6%) per annum, calculated as if the sum consisted of equal monthly
payments, one (1) of which was due at the end of each month between
July 1, 1980, and the date the election was made. The election shall be
addressed to and filed with the secretary of the Finance and
Administration Cabinet and shall constitute an authorization to the
secretary to thereafter cause to be deducted from the member's monthly
creditable compensation an amount equal to five percent (5%) thereof, as
a voluntarily elected contribution by the member towards the funding of
the Legislators' Retirement Plan.
(b) 1.
For a member who begins participating in the Legislators'
Retirement Plan prior to January 1, 2014, the election shall operate
to create an inviolable contract between such member and the
Commonwealth, guaranteeing to and vesting in the member the
rights and benefits provided for under KRS 6.515 to 6.530.
2. a.
For members who begin participating in the Legislators'
Retirement Plan on or after January 1, 2014, the General
Assembly reserves the right to amend, suspend, or reduce the
benefits and rights provided under KRS 6.500 to 6.577 if, in its
judgment, the welfare of the Commonwealth so demands,
except that the amount of benefits the member has accrued at
the time of amendment, suspension, or reduction shall not be
affected.
b.
For purposes of this subparagraph, the amount of benefits the
member has accrued at the time of amendment, suspension,
or reduction shall be limited to the accumulated account
balance the member has accrued at the time of amendment,
(2)
suspension, or reduction.
c.
The provisions of this subsection shall not be construed to limit
the General Assembly's authority to change any other benefit
or right specified by KRS 6.500 to 6.577, for members who
begin participating in the Legislators' Retirement Plan on or
after January 1, 2014, except the benefits specified by
subparagraph 2.b. of this paragraph.
3.
The provisions of this paragraph shall not be construed to limit the
General Assembly's authority to amend, reduce, or suspend the
benefits and rights of members of the Legislators' Retirement Plan
as provided by KRS 6.500 to 6.577 that the General Assembly had
the authority to amend, reduce, or suspend, prior to July 1, 2013.
(c) An election once made under this section either to participate or not to
participate in the Legislators' Retirement Plan, shall be considered to
apply to all future service as a legislator, whether in the same or a
different office as a legislator, and whether or not it is in successive terms.
(d) Notwithstanding the provisions of this subsection:
1.
A legislator who becomes a member of the Legislators' Retirement
Plan on or after September 1, 2008, but prior to January 1, 2014,
shall make monthly contributions to the Legislators' Retirement Plan
in an amount equal to six percent (6%) of his monthly creditable
compensation, as defined in KRS 61.510(13).
2.
A legislator who becomes a member of the Legislators' Retirement
Plan on or after January 1, 2014, shall make monthly contributions
to the Legislators' Retirement Plan in an amount equal to six percent
(6%) of his or her monthly creditable compensation, as defined in
KRS 61.510(13), of which:
a.
Five percent (5%) of his or her monthly creditable
compensation, as defined in KRS 61.510(13), shall be used to
provide funding for benefits provided under KRS 21.402; and
b.
One percent (1%) of his or her monthly creditable
compensation, as defined in KRS 61.510(13), shall be used
exclusively to help fund retiree health benefits as provided by
KRS 6.577 and shall not be refunded to the member if the
member withdraws his or her accumulated account balance as
provided by KRS 21.460. The amounts deducted under this
subdivision shall be credited to an account established
pursuant to 26 U.S.C. sec. 401(h), within the fund established
by KRS 6.350.
A legislator entitled to elect membership in the retirement system who failed to
elect membership within thirty (30) days after taking office may elect
membership not later than August 31, 2005. An election, upon being made
pursuant to this section, shall operate to create an inviolable contract between
the member entitled to elect membership under this subsection and the
Commonwealth, guaranteeing to and vesting in the member the rights and
benefits provided for under the terms and conditions of KRS 6.500 to 6.577.
(3)
(4)
(5)
When any legislator makes a delayed election of membership in the
Legislators' Retirement Plan under subsection (2) of this section, his active
membership in the Kentucky Employees Retirement System shall terminate, as
of the date his membership in the Legislators' Retirement Plan becomes
effective, and any credit in the Kentucky Employees Retirement System,
earned for service as a legislator, which he then has or which he subsequently
regains while being an active member of the Legislators' Retirement Plan, shall
be transferred to and counted as service credit in the Legislators' Retirement
Plan, and shall no longer constitute credit in the Kentucky Employees
Retirement System, except for the purpose of validating any other credit in that
system if the member pays the difference, if any, between the amount
transferred from the Kentucky Employees Retirement System and the actuarial
value of the transferred service. However, any credit he then has in the
Kentucky Employees Retirement System, earned for service in any capacity
other than a legislator, shall not be affected. No person may attain credit in
more than one (1) of the retirement plans or systems mentioned in this section
for the same period of service. When credit is transferred from the Kentucky
Employees Retirement System to the Legislators' Retirement Plan, the
Kentucky Employees Retirement System shall transfer to the Legislators'
Retirement Fund an amount equal to the employee's and employer's
contributions attributable to that credit, together with interest on the
contributions from the date made to the date of transfer at the actuarially
assumed interest rate of the Kentucky Employees Retirement System in effect
at the time the contributions were made, compounded annually at that same
interest rate.
The state shall, solely for the purpose of compliance with Section 414(h) of the
United States Internal Revenue Code, pick up the employee contributions
required by this section for all compensation earned after August 1, 1982, and
the contributions so picked up shall be treated as employer contributions in
determining tax treatment under the United States Internal Revenue Code and
KRS 141.010(10). The picked-up employee contribution shall satisfy all
obligations to the retirement system satisfied prior to August 1, 1982, by the
employee contribution, and the picked-up employee contribution shall be in lieu
of an employee contribution. The state shall pay these picked-up employee
contributions from the same source of funds which is used to pay earnings to
the employee. The employee shall have no option to receive the contributed
amounts directly instead of having them paid by the employer to the system.
Employee contributions picked up after August 1, 1982, shall be treated for all
purposes of KRS 6.500 to 6.535 in the same manner and to the same extent
as employee contributions made prior to August 1, 1982.
When any legislator elects membership in the Legislators' Retirement Plan in
accordance with this section, his active membership in the Kentucky
Employees Retirement System, State Police Retirement System, County
Employees Retirement System, or Teachers' Retirement System shall
terminate, as of the date his membership in the Legislators' Retirement Plan
becomes effective, and any credit in such other system or systems, earned for
service as a legislator, which he then has or which he subsequently regains
while being an active member of the Legislators' Retirement Plan, shall be
(6)
transferred to and counted as service credit in the Legislators' Retirement Plan,
and shall no longer constitute credit in such other retirement system except for
the purpose of validating any other credit in that system. However, any credit
he then has in such other retirement system, earned for service in any capacity
other than a legislator, shall not be affected. No person may attain credit in
more than one (1) of the retirement plans or systems mentioned in this section,
for the same period of service.
A member of the Legislators' Retirement Plan who would be entitled, under
KRS 61.552, to repurchase credit in the Kentucky Employees Retirement
System, for previous service as a legislator, which credit had been lost by
refund of contributions, may pay the amount required by KRS 61.552 directly to
the Legislators' Retirement Plan and thereby obtain credit in that plan for such
service, rather than making payment to the Kentucky Employees Retirement
System for credit which would be transferred to the Legislators' Retirement
Plan. In such event, the Kentucky Employees Retirement System shall transfer
to the Legislators' Retirement Plan an amount equal to the employer's
contributions that originally were made to the Kentucky Employees Retirement
System for the regained service credit, with interest as provided in KRS 6.535.
Six (6) months' current service shall be required in the Legislators' Retirement
Plan in order for the repurchased credit to remain in force, the same as
provided in KRS 61.552. Service purchased under this subsection on or after
January 1, 2014, shall not be used to determine the member's participation
date in the Legislators' Retirement Plan.
Effective:July 1, 2013
History: Amended 2013 Ky. Acts ch. 120, sec. 13, effective July 1, 2013. -Amended 2008 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 3, effective June 27, 2008.
-- Amended 2005 Ky. Acts ch. 86, sec. 2, effective June 20, 2005. -- Amended
1990 Ky. Acts ch. 476, Pt. VII D, sec. 640, effective April 11, 1990. -- Amended
1984 Ky. Acts ch. 111, sec. 10, effective July 13, 1984. -- Amended 1982 Ky.
Acts ch. 166, sec. 6, effective July 15, 1982; and ch. 458, sec. 4, effective April
15, 1982. -- Created 1980 Ky. Acts ch. 407, sec. 13, effective July 1, 1980.
Legislative Research Commission Note (7/1/2013). A citation to KRS 6.350 was
inserted at the end of subsection (1) when this statute was amended in 2013 Ky.
Acts ch. 120, sec. 13. This citation may contain a typographical error. The
legislative drafter who drafted the bill and the Reviser of Statutes agree that a
reference to KRS 6.530 was probably intended.
2012-2014 Budget Reference. See Legislative Branch Budget, 2012 Ky. Acts ch.
19, Pt. I, 1, (1) at 506.
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