2021 Kentucky Revised Statutes Chapter 78 - County employees' civil service and retirement 78.5512 Hybrid cash balance plan for members in nonhazardous positions who began participating on or after January 1, 2014, and for members who make election under KRS 61.5955.
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78.5512 Hybrid cash balance plan for members in nonhazardous positions
who began participating on or after January 1, 2014, and for members
who make election under KRS 61.5955.
(1)
(2)
(3)
(4)
A member of the County Employees Retirement System who is participating in
a nonhazardous position and who began participating in the system on or after
January 1, 2014, or a member who makes an election pursuant to KRS
61.5955, shall receive the retirement benefits provided by this section in lieu of
the retirement benefits provided under KRS 78.5510. The retirement benefit
provided by this section shall be known as the hybrid cash balance plan and
shall operate as another benefit tier within the County Employees Retirement
System.
The hybrid cash balance plan shall provide a retirement benefit based upon the
member's accumulated account balance, which shall include:
(a) Contributions made by the member as provided by KRS 78.510 to
78.852, except for employee contributions prescribed by KRS
78.5536(3)(b);
(b) An employer pay credit of four percent (4%) of the creditable
compensation earned by the employee for each month the employee is
contributing to the hybrid cash balance plan provided by this section; and
(c) Interest credits added annually to the member's accumulated account
balance as provided by this section.
(a) Member contributions and employer pay credits as provided by
subsection (2)(a) and (b) of this section shall be credited to the member's
account monthly as contributions are reported and posted to the system
in accordance with KRS 78.625.
(b) Interest credits, as provided by subsection (2)(c) of this section, shall be
credited to the member's account annually on June 30 of each fiscal year,
as determined by subsection (4) of this section.
(a) On June 30 of each fiscal year, the system shall determine if the member
contributed to the hybrid cash balance plan or the Kentucky Retirement
Systems during the fiscal year.
(b) If the member contributed to the hybrid cash balance plan or the
Kentucky Retirement Systems during the fiscal year, the interest credit
added to the member's account for that fiscal year shall be determined by
multiplying the member's accumulated account balance on June 30 of the
preceding fiscal year by a percentage increase equal to:
1.
Four percent (4%); plus
2.
Seventy-five percent (75%) of the system's geometric average net
investment return in excess of a four percent (4%) rate of return.
(c) If the member did not contribute to the hybrid cash balance plan or the
Kentucky Retirement Systems during the fiscal year, the interest credit
added to the member's account for that fiscal year shall be determined by
multiplying the member's accumulated account balance on June 30 of the
preceding fiscal year by four percent (4%).
(d) For purposes of this subsection, "system's geometric average net
(5)
(6)
(7)
(8)
investment return":
1.
Means the annual average geometric investment return, net of
administrative and investment fees and expenses, over the last five
(5) fiscal years as of the date the interest is credited to the member's
account; and
2.
Shall be expressed as a percentage and based upon the system in
which the member has an account.
(e) No employer pay credits or interest credits shall be provided to a member
who has taken a refund of contributions as provided by KRS 61.625 or
who has retired and annuitized his or her accumulated account balance
as prescribed by this section.
(a) Upon termination of employment, a member who has less than five (5)
years of service credited under KRS 16.543(1), 61.543(1), and 78.615(1),
who elects to take a refund of his or her accumulated account balance as
provided by KRS 61.625, shall forfeit the accumulated employer credit,
and shall only receive a refund of his or her accumulated contributions.
(b) Upon termination of employment, a member who has five (5) or more
years of service credited under KRS 16.543(1), 61.543(1), and 78.615(1),
who elects to take a refund of his or her accumulated account balance as
provided by KRS 61.625, shall receive a full refund of his or her
accumulated account balance.
A member participating in the hybrid cash balance plan provided by this
section may retire:
(a) At his or her normal retirement age, provided he or she has earned five
(5) or more years of service credited under KRS 16.543(1), 61.543(1), or
78.615(1), or another state-administered retirement system; or
(b) If the member is at least age fifty-seven (57) and has an age and years of
service total of at least eighty-seven (87) years. The years of service used
to determine eligibility for retirement under this paragraph shall only
include years of service credited under KRS 16.543(1), 61.543(1), or
78.615(1), or another state-administered retirement system.
A member eligible to retire under subsection (6) of this section may elect to:
(a) Receive a monthly retirement allowance payable for life by having his or
her accumulated account balance annuitized by the system in accordance
with the actuarial assumptions and actuarial methods adopted by the
board and in effect on the member's retirement date;
(b) Receive the actuarial equivalent of his or her retirement allowance
calculated under paragraph (a) of this subsection payable under one (1)
of the options set forth in KRS 61.635, except for the option provided by
KRS 61.635(11); or
(c) Take a refund of his or her account balance as provided by KRS 61.625.
The provisions of this section shall not apply to members who began
participating in the Kentucky Employees Retirement System, County
Employees Retirement System, or the State Police Retirement System prior to
January 1, 2014, except as provided by KRS 61.5955.
Effective:April 1, 2021
History: Created 2021 Ky. Acts ch. 102, sec. 2, effective April 1, 2021.
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