Current through Register Vol. 50, No. 6, December 1, 2023
RELATES TO: KRS 6.500-6.577, 16.505-16.645, 21.345-21.570,
61.510-61.705,
78.510-
78.990, 161.600(3), 161.675
NECESSITY, FU NCTION, AND CONFORMITY:
KRS
61.645(9)(e) authorizes the
Board of Trustees of Kentucky Retirement Systems to promulgate all
administrative regulations necessary or proper in order to carry out the
provisions of
KRS
61.515 to
61.705,
16.510
to
16.652,
and
78.520
to
78.852.
KRS
61.680 provides for the combining of
retirement accounts for public employees having a retirement account in more
than one (1) of the following state administered retirement systems: County
Employees Retirement System, Kentucky Employees Retirement System, Judicial
Retirement Plan, Legislators Retirement Plan, State Police Retirement System
and Teachers' Retirement System. This administrative regulation establishes
requirements to implement
KRS
61.680.
Section
1. Upon death, disability or service retirement the following
procedure shall be applicable in order to determine benefits for a member
having an account in more than one (1) retirement system:
(1) Combine the member's service in all
systems.
(2) Determine eligibility
in each system based on combined service.
(3) If eligible in any system, determine
benefits.
(4) Check for specific
exceptions such as prior service, request for separate account or special death
or disability exception.
(5) Each
system shall pay the applicable percentage of total benefit unless a specific
exception exists.
Section
2.
(1) A member eligible to
retire who elects service retirement from one (1) system, shall be paid from
all systems in which he has an account unless he requests that his accounts be
separated.
(2) The "final
compensation" shall be calculated by using the five (5) highest, or three (3)
highest, if eligible, fiscal years creditable compensation regardless of the
system under which the service was earned, except as provided in
KRS
61.680(7).
(3) Each system shall determine benefit
payments on the basis of the final compensation but using only the service
earned in that system. Payments shall be made by each system in accordance with
its usual procedures. If a member is not eligible for an unreduced benefit,
benefits shall be actuarially reduced based on factors adopted by the
respective retirement boards.
(4)
The retiring member or beneficiary shall be required to elect the same payment
option in each system administered by the Kentucky Retirement Systems except
that a state policeman or a member with hazardous service may select the "Ten
(10) Year Certain" option set forth in
KRS
16.576(4) irrespective of
the option chosen for nonhazardous service.
(5) A retiring member may elect to have each
system treat his service credit in that system without regard to any other
service credit, by requesting that his accounts be separated by filing a Form
2022, Separation of Accounts, with the Form 6000, Notification of Retirement.
If so requested, "final compensation" shall be based on the creditable
compensation earned under each system separately.
Section 3.
(1)
(a) If a
contributing member of one (1) of the six (6) systems qualifies for disability
benefits, all systems under which the combined service meets service
requirements shall participate in benefit payments unless accounts are
separated by provisions of
KRS
61.680(2)(b).
(b) Each system shall calculate benefits
using the formula in effect in that system.
(c) Service added to County Employees
Retirement System, Kentucky Employees Retirement System and State Police
Retirement System accounts in accordance with the appropriate disability
formula in
105 KAR
1:210, Section 9, shall be prorated between system
accounts based on a percentage of actual earned service in each system unless
such proration conflicts with maximum added service permitted by law governing
each system.
(2) If the
combined service of a member meets service requirements in only one (1) system
then that system shall pay benefits under the disability formula and the other
system shall pay as follows:
(a) Benefits
based on separate accounts if the member elects to maintain separate
accounts;
(b) An actuarial accrued
benefit based on the member's age, service and final compensation; or
(c) A refund, if requested by the
member.
(3) The medical
requirements for disability benefits shall be those of the system to which the
member last contributed if combined service meets service requirements of that
system. If service requirements are met in only one (1) system, the medical
requirements of that system shall prevail.
Section 4. A member contributing to any of
the six (6) retirement systems who has combined service sufficient to qualify
for a death benefit shall have his County Employees Retirement System, Kentucky
Employees Retirement System or State Police Retirement System benefits computed
under the regular death formula based on his service in each of the three (3)
systems.
Section 5. A member having
valid service credit in more than one (1) of the retirement systems
administered by Kentucky Retirement Systems who is eligible to purchase service
credit may elect to purchase service credit in one (1) system, or he may divide
the service credit between the systems permitting purchase. If service is to be
divided, the following additional requirements shall be met:
(1) The same years of service shall not be
used in more than one (1) system.
(2) Each system shall calculate the costs of
the retirement credit in keeping with the statutes and administrative
regulations of that system.
Section
6.
(1) A retiring member with
service in the Kentucky Teachers' Retirement System and one (1) or more of the
three (3) systems administered by Kentucky Retirement Systems shall have his
total service in all four (4) systems combined to determine his eligibility for
medical insurance benefits. The systems shall share the cost of the member's
premium under this section based on his combined service.
(2) If the member meets the minimum
eligibility requirements, the member may elect to participate in the insurance
program established under
KRS
61.702 or
161.675.
The premium paid from the insurance funds shall not be more than 100 percent of
the single premium amount adopted by the respective boards of trustees or more
than the maximum percentage payable under the program established under
KRS
61.702 or
161.675.
(3)
(a) If
the member elects to participate in the program under
KRS
61.702, the member's service in the systems
shall be combined to determine the applicable percentage that shall be paid
toward his individual coverage under
KRS
61.702(3).
(b) The systems shall pay a pro rata share of
the member's premium based on the service in each system expressed as a
percentage of total service credit earned in all systems not to exceed the
amount of the single premium cost adopted by the Board of Trustees of Kentucky
Retirement Systems.
1. The amount paid by the
Kentucky Teachers' Retirement System shall not exceed the amount of the single
premium cost adopted by the Board of Trustees of the Kentucky Teachers'
Retirement System.
2. The Kentucky
Teachers' Retirement System shall not pay a percentage of the premium for the
spouse and dependents.
(4)
(a) If
the member elects to participate in the program under
KRS
161.675, the member's service in the systems
shall be combined to determine the applicable percentage that shall be paid
under
KRS
161.675(3).
(b) The systems shall pay a pro rata share of
the member's premium based on the service in each system expressed as a
percentage of total service credit earned in all systems, including service in
the Legislators' Retirement Plan and Judicial Retirement Plan, not to exceed
the amount paid toward the monthly premium cost adopted by the Board of
Trustees of Kentucky Teachers' Retirement System.
1. The amount paid by the Kentucky Employees
Retirement System, County Employees Retirement System and State Police
Retirement System shall not exceed the amount of the single premium cost
adopted by the Board of Trustees of the Kentucky Retirement Systems.
2. The Kentucky Employees Retirement System,
County Employees Retirement System and State Police Retirement System shall not
pay a percentage of the premium for the spouse or dependents.
(5) Premiums payable
under
KRS
61.702 shall be paid by the Kentucky
Employees Retirement System, County Employees Retirement System, and State
Police Retirement System. The Kentucky Teachers' Retirement System shall
reimburse the systems for the portion of the premium attributable to service in
that system. Premiums payable under
KRS
161.675 shall be paid by the Kentucky
Teachers' Retirement System. The Kentucky Employees Retirement System, County
Employees Retirement System, and State Police Retirement System shall reimburse
the system for the portion of the premium attributable to service in those
systems.
Section 7.
Incorporation by Reference.
(1) The following
material is incorporated by reference:
(a)
"Form 2022, Separation of Accounts, August 2002", Kentucky Retirement Systems;
and
(b) "Form 6000, Notification of
Retirement, July 2004", Kentucky Retirement Systems.
(2) This material may be inspected, copied,
or obtained, subject to applicable copyright law, at the Kentucky Retirement
Systems, Perimeter Park West, 1260 Louisville Road, Frankfort, Kentucky
40601-6124, Monday through Friday, 8 a.m. to 4:30 p.m.
1 Ky.R. 717; eff.
5-14-1975; 9 Ky.R. 1162; eff. 5-4-1983; 19 Ky.R. 962; eff. 12-9-1992; 29 Ky.R.
755; 1243; eff. 11-12-2002; 31 Ky.R. 380; eff. 11-5-2004; TAm eff. 3-5-2019;
Crt eff. 3-5-2019.
STATUTORY AUTHORITY:
KRS
61.645(9)(e)