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6.521 Increase of retirement benefits.
(1)
(2)
(3)
As of July 1 of each year, the board of trustees of the Kentucky Judicial Form
Retirement System shall recompute the monthly benefits of persons then
receiving benefits under the Legislators' Retirement Plan, by using the
following formula: three and one-half percent (3.5%) times fifty-five percent
(55%) of the final compensation of the office in which the credit was earned for
a person retiring as of the recomputation date, times the number of years of
service credit (not to exceed twenty-eight (28) years). In making the
recomputation, the same reduction factor, in case of an actuarially reduced
benefit or a surviving spouse's benefit, shall be used as was used in
determining the benefit then being received. If the benefit as recomputed in
accordance with this section is higher than the benefit then being received, the
recomputed benefit shall thereafter be paid monthly, commencing as of the
date specified for the recomputation, subject to future adjustment at ensuing
recomputations in accordance with this section.
Effective August 1, 1998, to July 1, 2008, a recipient of a monthly pension
benefit from the Legislators' Retirement Plan shall have his or her benefit
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 state's appropriation to the
Legislators' Retirement Fund, only the costs of increases granted as of the
most recent valuation date shall be recognized. The benefits of this subsection
as provided on August 1, 1998, to July 1, 2008, shall not be considered as
benefits protected by the inviolable contract provisions of KRS 6.505. 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.
(a) Effective July 1, 2009, and on July 1 of each year thereafter, a recipient of
a monthly pension benefit from the Legislators' Retirement Plan shall
have his or her benefit increased by one and one-half percent (1.5%), if:
1.
The funding level of the plan 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; or
2.
The General Assembly appropriates sufficient funds to fully prefund
the increase described by this subsection in the year the increase is
provided.
(b) The board of trustees of the Kentucky Judicial Form Retirement 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.
Whether the plan has a funding level greater than one hundred
percent (100%) and if the plan 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 plan below one hundred percent (100%); and
2.
(4)
If no surplus actuarial assets are available, the level of funds
needed to fully prefund an increase for plan 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 plan's actuary in the
plan's actuarial valuation.
(d) The full increase described by this subsection shall only be provided if the
recipient has been receiving a retirement 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 a benefit in the twelve (12) months preceding the effective date
of the increase.
(e) In determining the state's appropriation to the Legislators' Retirement
Fund, only the costs of increases granted as of the most recent valuation
date shall be recognized.
(f) 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 6.505. 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.
In addition to the increase to a recipient's retirement allowance as provided by
subsection (3) of this section, the General Assembly may, by subsequent
legislation, provide supplemental increases to a recipient's retirement
allowance to help adjust for actual changes in the recipient's cost of living if the
General Assembly appropriates sufficient funds to fully prefund the benefit in
the year the increase is provided.
Effective:July 1, 2013
History: Amended 2013 Ky. Acts ch. 120, sec. 16, effective July 1, 2013. -Amended 2008 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 2, effective June 27, 2008.
-- Amended 1998 Ky. Acts ch. 360, sec. 2, effective July 15, 1998. -- Created
1982 Ky. Acts ch. 380, sec. 2, effective July 15, 1982.
Legislative Research Commission Note (7/1/2013). This statute was amended by
Section 16 of 2013 Ky. Acts ch. 120. Section 81 of that Act reads,
"Notwithstanding any other provision of this Act to the contrary, the amendments
in Sections 16, 25, and 69 of this Act shall in no way nullify the provisions of
2012 Ky. Acts ch. 19, Part I, 1.(4), 2012 Ky. Acts ch. 68, Part I, 2.(2), or 2012
Ky. Acts ch. 144, Part IV, 10., which suspended the cost-of-living adjustment
that would have been provided to retirees and beneficiaries of the Legislative
Retirement Plan, the Judicial Retirement Plan, the State Police Retirement
System, the Kentucky Employees Retirement System, and the County
Employees Retirement System on July 1, 2012, and July 1, 2013."
2012-2014 Budget Reference. See Legislative Branch Budget, 2012 Ky. Acts ch.
19, Pt. I, 1, (1) at 506.
2012-2014 Budget Reference. See Legislative Branch Budget, 2012 Ky. Acts ch.
19, Pt. I, 1, (4) at 506
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