KTRS 2012 Legislative Presentation for KRTA
Legislative & Health Insurance Committees Meeting 11-14-2011
~ 2010 REGULAR SESSION Kentucky General Assembly ~
House Bill 540 – A Shared Responsibility Approach
to Funding Retired Teacher Medical Insurance
January 20, 2010 ~ KTRS Applauds Governor’s Proposal
Looking Forward to Long-term Solution to Pension Issue from General Assembly
~ 2009 REGULAR SESSION Kentucky General Assembly ~
There were no bills enacted during the 2009 Regular Session of the General Assembly that would have any direct impact on KTRS. Some legislation, often generically described as retirement system legislation, was enacted during this Session in regard to Kentucky Retirement Systems (KRS), but that legislation impacted KRS only. At this point, the General Assembly will not reconvene until January of 2010, unless a Special Session is called by the Governor in the interim.
~ 2008 SPECIAL SESSION of the Kentucky General Assembly ~
House Bill 1 (Pension Reform) has been passed by the legislature and signed by Gov. Beshear. This legislation affects KTRS accounts that begin on or after July 1, 2008.
Listed below are two sections of "Questions & Answers" that explain the impact of legislative changes. The "Section 1" deals with the impact to members with un-refunded accounts established prior to July 1, 2008. The "Section 2" deals with the impact to members with accounts that begin on or after July 1, 2008. Please contact KTRS at 1-800-618-1687 or at www.ktrs.info.ky.gov if you have additional questions.
Click below for "Questions & Answers" regarding HB 1 ~~ Please "refresh" your computer before clicking.
HB 1 — Pension Reform Legislation
~ 2008 REGULAR SESSION of the Kentucky General Assembly ~ Ended April 15, 2008
The General Assembly adjourned its Regular Session of 2008 on April 15th and will not return until the 2009 Regular Session unless the Governor should call a Special Session in the interim. Among the retirement legislation of note that was introduced during the 2008 Regular Session are the following:
House Bill 470
HB 470 is the bill that contained most of the proposals recommended by the Board of Trustees at its December 2007 meeting. HB 470 passed out of both the House of Representatives and the Senate and was signed into law by the Governor on April 11, 2008. Its provisions become effective on July 1, 2008. HB 470 is mostly housekeeping in nature and does not change the current practice of the retirement system, but it does contain a few substantive provisions as follow:
• Allows un-purchased out-of-state K-12 public school service to count toward the thirty years required to return to work at 75% of last annual compensation as opposed to 65%.
• Provides a minimum Daily Wage Threshold
• Allows retirees to remove their ex-spouses as beneficiary even if they miss the sixty (60) day deadline for doing so. This would not permit members to increase their retirement allowance or change their retirement option and would not allow them to "pop up" to an Option I actuarial equivalent in the event that their spouse later predeceases them (even if they selected a pop-up option at the time of retirement).
Senate Bill 65
Senate Bill 65 passed out of both the Senate and the House and was signed into law by the Governor on April 7th. It became effective upon the signature of the Governor. Senate Bill 65 allows university employees who participate in the Optional Retirement Plan a one-time election, within their first six years and six months of employment, to switch to KTRS and purchase their prior service during which they participated in the ORP. Additionally, it provides all university employees a one-time opportunity, even if they have been employed longer than six years and six months, to make this election as long as they elect to do so by December 31, 2008. Only university employees who are otherwise eligible for membership in KTRS may make this election. This bill also provides universities with an alternate payment plan for their share of the retirement system's unfunded liability.
House Bill 406, The Executive Budget
House Bill 406, The Executive Budget bill attempts to deal with the reality of allocating scarce discretionary dollars among many important needs of the Commonwealth. For KTRS, House Bill 406 provides funding for employer contributions, payments for past cost of living adjustments, sick leave, and minimum value benefit adjustments. It also continues to provide amortized payments, with interest, on the amounts that were borrowed from the pension fund to pay for past medical insurance costs for retirees. The bill does continue the practice of borrowing from the pension fund to pay for medical insurance costs by doing so for the 2008-2010 biennium. It also, for the first time, borrows to pay for the medical insurance dependent subsidy. It does not provide a requested supplemental employer contribution for the pension fund as recommended by the system's actuary, nor was additional funding for ad hoc cost of living adjustments available. As such, the cost of living adjustments that will be provided on July 1, 2008 and 2009 will be the fixed 1.5% cost of living adjustment guaranteed by statute.
House Bill 600
House Bill 600, the Administration's Pension Reform Bill, would have made some changes to the KTRS pension structure and medical insurance program for persons who would become members of the retirement system on or after July 1, 2008. This bill would have made more significant changes to the pension structure and medical insurance program for new members of Kentucky Retirement Systems. However, despite strong efforts from each body to reconcile the two, the version of the bill that passed in the House of Representatives differed from the version that passed in the Senate. Therefore, House Bill 600 did not become law.
Other Miscellaneous Bills
House Bill 743 would have provided a supplemental, floating employer contribution for KTRS, but did not pass. House Bill 466 would have extended the 100-day program, for persons who had continued employment under its provisions through 2006-2007, until June 30, 2011, but did not pass. House Bill 53 would have extended a window of retirement benefits that is set to expire in January of 2009 for participants in Kentucky Retirement Systems (KRS), but did not pass. Senate Bill 11 would have required the Commonwealth to provide funding sufficient to maintain a level of coverage for retired teachers equal to that provided to active teachers, but did not pass. Senate Bill 131 deletes the requirement that the survivorship benefit is available to legally adopted children only if the adoption process began one year or more prior to the member's death, and now only requires that the child be legally adopted at the time of the member's death. Senate Bill 131 did pass and is retroactive to January 1, 1990.
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