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1 AN ACT relating to the Kentucky Teachers' Retirement System.
2 Be it enacted by the General Assembly of the Commonwealth of Kentucky:
3 Section 1. KRS 161.520 is amended to read as follows:
4 Upon the death of an active contributing member or upon the death of a member retired
5 for disability, except as provided in KRS 161.661(6), the survivors of the deceased
6 member in the following named order, may elect to receive a survivor's benefit payable
7 as follows:
8 (1) Where there is a surviving widow or widower who is named as the primary
9 beneficiary of the member's retirement account, the benefit shall be:
10 (a) One hundred eighty dollars ($180) per month with no restriction on other
11 income;
12 (b) Two hundred forty dollars ($240) per month when the surviving widow or
13 widower's total income from all sources does not exceed six thousand six
14 hundred dollars ($6,600) per year or five hundred fifty dollars ($550) per
15 month; or
16 (c) If the deceased member has a minimum of ten (10) years of service credit
17 with the Teachers' Retirement System, the surviving widow or widower may
18 apply for an annuity actuarially equivalent to the annuity that would have
19 been paid to the deceased member when eligibility conditions were met.
20 Eligibility for payments would begin at the time the age of the deceased
21 member would have met the requirements of KRS 161.600(1) or (2), as
22 applicable. In exercising this right, the surviving widow or widower shall be
23 entitled to receive an annuity for life. This subsection applies to surviving
24 spouses of members who die on or after July 1, 1978. A surviving widow or
25 widower of a member who dies after July 1, 1978, shall be eligible for benefit
26 payments provided under paragraphs (a) and (b) of this subsection until they
27 begin receiving payments under this provision;
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1 (2) (a) Where there are surviving unmarried children under age eighteen (18) or
2 under age nineteen (19) if a full-time student in high school, the benefit shall
3 be two hundred dollars ($200) per month in the case of one (1) child, three
4 hundred forty dollars ($340) per month in the case of two (2) children, four
5 hundred dollars ($400) per month in the case of three (3) children, and four
6 hundred forty dollars ($440) per month in the case of four (4) or more
7 children. Benefits under this subsection shall apply in addition to benefits
8 which may be payable under subsections (1) and (3) of this section.
9 (b) Notwithstanding any provision of law to the contrary, the surviving spouse
10 may elect to receive a lump-sum refund of the member's accumulated account
11 balance in lieu of the survivorship benefits payable under this subsection and
12 subsection (1) of this section only if the surviving spouse is designated as the
13 primary beneficiary and:
14 1. Is a biological or adoptive parent of all children eligible for a benefit
15 under this subsection and has not had his or her parental rights
16 terminated; or
17 2. Has been appointed as legal guardian of all of the children eligible under
18 paragraph (a) of this subsection.
19 (c) To elect a lump-sum refund of the member's accumulated account balance
20 under paragraph (b) of this subsection, the surviving spouse who is designated
21 as the primary beneficiary must sign a waiver on forms prescribed by the
22 retirement system of his or her rights and the member's children's rights to the
23 survivorship benefits payable under this subsection and subsection (1) of this
24 section. The surviving spouse shall not waive the survivorship benefits
25 available under this subsection or subsections (1) and (6) of this section if any
26 of the member's children have attained age eighteen (18) or older unless all of
27 those children consent in writing on forms prescribed by the retirement
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1 system to waive their survivorship benefits available under this subsection;
2 (3) (a) Where the survivor is a child age eighteen (18) or older whose mental or
3 physical condition is sufficient to cause his or her dependency on the deceased
4 member at the time of the member's death, the benefit shall be two hundred
5 dollars ($200) per month, payable for the life of the child or until the time as
6 the mental or physical condition creating the dependency no longer exists or
7 the child marries. The mental or physical condition of the adult child shall be
8 revealed by a competent examination by a licensed physician[ and shall be
9 approved by a majority of a medical review committee as defined in KRS
10 161.661(14)]. Benefits under this subsection shall apply in addition to benefits
11 which may be payable under subsections (1) and (2) of this section.
12 (b) Notwithstanding any provision of law to the contrary, the surviving spouse
13 shall not elect to receive a lump-sum refund of the member's accumulated
14 account balance in lieu of the survivorship benefits payable under this
15 subsection and subsection (1) of this section unless:
16 1. The surviving spouse is designated as the primary beneficiary;
17 2. The surviving spouse has been appointed by the court as guardian,
18 conservator, or other fiduciary with sufficient general or specific
19 authority to waive the survivorship benefits available under this
20 subsection for any child or children age eighteen (18) or older who have
21 been adjudicated incompetent to make decisions on their own behalf by
22 a court of law; and
23 3. Any child or children age eighteen (18) or older who are mentally
24 competent to make decisions on their own behalf consent in writing on
25 forms prescribed by the retirement system to waive their survivorship
26 benefits available under this subsection.
27 (c) If eligible to elect a lump-sum refund of the member's accumulated account
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1 balance, the surviving spouse shall sign a waiver on forms prescribed by the
2 retirement system of his or her rights and the member's children's rights to the
3 survivorship benefits payable under this subsection and subsections (1) and
4 (2) of this section;
5 (4) Where the sole eligible survivors are dependent parents aged sixty-five (65) or over,
6 the benefit shall be two hundred dollars ($200) per month for one (1) parent or two
7 hundred ninety dollars ($290) per month for two (2) parents. Dependency of a
8 parent shall be established as of the date of the death of the member;
9 (5) Where the sole eligible survivor is a dependent brother or sister, the benefit shall be
10 one hundred sixty five dollars ($165) per month. In order to qualify, the brother or
11 sister must have been a resident of the deceased member's household for at least
12 one (1) full year prior to the member's death or must have been receiving care in a
13 hospital, nursing home, or other institution at the member's expense for same
14 period;
15 (6) The benefit to a child as defined in subsection (2) of this section shall terminate
16 upon the attainment of age eighteen (18) or upon reaching age nineteen (19), if a
17 full-time student in high school, or upon marriage, except that benefits shall
18 continue until the attainment of age twenty-three (23) for an unmarried child who is
19 a full-time student in a recognized educational program beyond the high school
20 level. The benefit to a dependent parent or dependent brother or sister or dependent
21 child age eighteen (18) or older shall terminate upon marriage, or upon termination
22 of the condition creating the dependency;
23 (7) The board of trustees shall be the sole judge of eligibility or dependency of any
24 beneficiary, and may require formal application or information relating to eligibility
25 or dependency, including proof of annual income satisfactory to the board. The
26 board of trustees may subpoena records and individuals whenever it deems this
27 action necessary;
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1 (8) No payment of benefits shall be made unless the board of trustees authorizes the
2 payment. The board shall promulgate administrative regulations for the
3 administration of the provisions in this section and in every case the decision of the
4 board of trustees shall be final as to eligibility, dependency, or disability, and the
5 amount of benefits payable;
6 (9) In the event that there are no eligible survivors as defined in subsections (1) to (5)
7 of this section, or in the event that the surviving spouse elects not to receive
8 survivorship benefits on his or her own behalf or on behalf of any of the member's
9 children as permitted under subsections (2) and (3) of this section, the board of
10 trustees shall pay to the estate or the designated beneficiaries of the deceased
11 member a refund of his or her accumulated account balance as provided in KRS
12 161.470(7). If the benefits paid or payable under subsections (1) to (5) of this
13 section and KRS 161.661 shall amount to a sum less than the member's
14 accumulated account balance at the time of death, the board of trustees shall pay to
15 the estate or designated beneficiaries of the deceased member the balance of the
16 accumulated account balance;
17 (10) Any person who is receiving benefits and becomes disqualified from receiving
18 those benefits under this section shall immediately notify the Teachers' Retirement
19 System of this disqualification in writing and shall return all benefits paid after the
20 date of disqualification. Failure to comply with these provisions shall create an
21 indebtedness of that person to the Teachers' Retirement System. Interest at the rate
22 of eight percent (8%) per annum shall be charged if the debt is not repaid within
23 sixty (60) days after the date of disqualification. Failure to repay this debt creates a
24 lien in favor of the Teachers' Retirement System upon all property of the person
25 who improperly receives benefits and does not repay those benefits; and
26 (11) Benefits under subsections (2) and (3) of this section shall apply to a child who is a
27 legally adopted survivor at the time of the death of the member. This provision shall
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1 be retroactive to include a child who was born after January 1, 1990, and is a legally
2 adopted survivor of a member whose death occurred prior to July 15, 2008.
3 Section 2. KRS 161.605 is amended to read as follows:
4 Any member retired by reason of service may return to work in a position covered by the
5 Kentucky Teachers' Retirement System and continue to receive his or her retirement
6 allowance under the following conditions:
7 (1) Any member who is retired with thirty (30) or more years of service may return to
8 work in a full-time or a part-time position, or in a position providing substitute
9 teaching service, covered by the Teachers' Retirement System and earn up to a
10 maximum of seventy-five percent (75%) of the member's last annual compensation
11 measured on a daily rate to be determined by the board of trustees. For purposes of
12 determining whether the salary of a member returning to work is seventy-five
13 percent (75%) or less of the member's last annual compensation, all remuneration
14 paid and benefits provided to the member, on an actual dollar or fair market value
15 basis as determined by the retirement system, excluding employer-provided medical
16 insurance required under subsection (4) of this section, shall be considered.
17 Members who were retired on or before June 30, 2002, shall be entitled to return to
18 work under the provisions of this section as if they had retired with thirty (30) years
19 of service. Nonqualified service credit purchased under the provisions of KRS
20 161.5465 or elsewhere with any state-administered retirement system shall not be
21 used to meet the thirty (30) year requirement set forth in this subsection. Out-of
22 state teaching service provided in public schools for kindergarten through grade
23 twelve (12) may count toward the thirty (30) year requirement set forth in this
24 subsection even if it is not purchased as service credit, if the member obtains from
25 his or her out-of-state employer certification of this service on forms prescribed by
26 the retirement system;
27 (2) Any member who is retired with less than thirty (30) years of service after June 30,
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1 2002, may return to work in a full-time or part-time position, or in a position
2 providing substitute teaching service, covered by the Teachers' Retirement System
3 and earn up to a maximum of sixty-five percent (65%) of the member's last annual
4 compensation measured on a daily rate to be determined by the board of trustees.
5 For purposes of determining whether the salary of a member returning to work is
6 sixty-five percent (65%) or less of the member's last annual compensation, all
7 remuneration paid and benefits provided to the member, on an actual dollar or fair
8 market value basis as determined by the retirement system, excluding employer-
9 provided medical insurance required under subsection (4) of this section, shall be
10 considered;
11 (3) Under this section, an employer may employ full-time a number of retired members
12 not to exceed ten percent (10%) of the membership actively employed full-time by
13 that employer. The board of trustees may reduce this ten percent (10%) cap upon
14 recommendation of the retirement system's actuary if a reduction is necessary to
15 maintain the actuarial soundness of the retirement system. The board of trustees
16 may increase the ten percent (10%) cap upon a determination that an increase is
17 warranted to help address a shortage in the number of available teachers and upon
18 the determination of the retirement system's actuary that the proposed cap increase
19 allows the actuarial soundness of the retirement system to be maintained. For
20 purposes of this subsection, "full-time" means the same as defined by KRS
21 161.220(21). A local school district may exceed the quota established by this
22 subsection by making an annual written request to the Kentucky Department of
23 Education which the department may approve on a year-by-year basis;
24 (4) (a) Except as provided by subsection (9) of this section, a retired member
25 returning to work in a full-time or part-time position, or in a position
26 providing substitute teaching service[,] under subsection (1) or (2) of this
27 section, shall contribute to an account with the retirement system that shall be
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1 administered independently from and with no reciprocal impact with the
2 member's original retirement account, or any other account from which the
3 member is eligible to draw a retirement allowance.
4 (b) Except as provided by subsection (9) of this section, a retired member
5 returning to work under subsection (1) or (2) of this section shall make
6 contributions to the retirement system at the rate provided under KRS
7 161.540. The new account shall independently meet all vesting requirements
8 as well as all other conditions set forth in KRS 161.600(1) or (2), as
9 applicable, before any retirement allowance is payable from this account. The
10 retirement allowance accruing under this new account shall be calculated
11 pursuant to KRS 161.620. This new account shall not entitle the member to a
12 duplication of the benefits offered under KRS 161.620(7) or 161.675, nor
13 shall this new account provide the benefits offered by KRS 161.520, 161.525,
14 161.620(3), 161.655, 161.661, or 161.663.
15 (c) A retired member returning to work for an employer that participates in a
16 state-administered retirement system[ under subsection (1) or (2) of this
17 section] shall waive his or her medical insurance with the Teachers'
18 Retirement System during the period of reemployment and shall receive the
19 medical insurance coverage that is offered by the member's active employer[
20 that is generally provided by the member's active employer to the other
21 members of the retirement system that the active employer employs]. If
22 medical insurance coverage is not available from the employer, the Kentucky
23 Teachers' Retirement System may provide coverage for the member.
24 (d) A retired member returning to work under subsection (1) or (2) of this section
25 shall not be eligible to purchase service credit for any service provided after
26 the member's effective date of retirement but prior to the date that the member
27 returns to work. A member returning to work under subsection (1) or (2) of
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1 this section shall not be eligible to purchase service credit that the member
2 would have otherwise been eligible to purchase prior to the member's initial
3 retirement.
4 (e) A retired member who returns to work under subsection (1) or (2) of this
5 section, or in the event of the death of the member, the member's estate or
6 applicably designated beneficiary, shall be entitled, within ninety (90) days of
7 the posting of the annual report submitted by the employer, to a refund of
8 contributions as permitted and limited by KRS 161.470;
9 (5) The board of trustees may annually, on July 1, adjust the current daily rate of a
10 member's last annual compensation, for each full twelve (12) month period that has
11 elapsed subsequent to the member earning his or her last annual compensation, by
12 the percentage increase in the annual average of the consumer price index for all
13 urban consumers for the calendar year preceding the adjustment as published by the
14 Federal Bureau of Labor Statistics, not to exceed five percent (5%) annually. Each
15 annual adjustment shall become part of the member's daily rate base. Failure to
16 comply with the salary limitations set forth in subsections (1) and (2) of this section
17 as may be adjusted by this subsection shall result in a reduction of the member's
18 retirement allowance or any other benefit to which the member would otherwise be
19 entitled on a dollar-for-dollar basis for each dollar that the member exceeds these
20 salary limitations, and the member shall be refunded his or her retirement
21 contributions made on the compensation that exceeds these salary limitations.
22 Notwithstanding any other provision of law to the contrary, a member retiring from
23 a local school district who returns to work for a local school district under
24 subsection (1) or (2) of this section shall be entitled, without any reduction to his or
25 her retirement allowance or any other retirement benefit, to earn a minimum
26 amount equal to two[one] hundred [seventy ]dollars ($200)[($170)] per day;
27 (6) (a) A retired member returning to work under subsection (1) or (2) of this section
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1 shall have separated from service for a period of at least one (1) year if
2 returning to work for the same employer on a full-time basis, and at least three
3 (3) months if returning to work for a different employer on a full-time basis.
4 A retired member returning to work under subsection (1) or (2) of this section
5 on a part-time basis shall have separated from service for a period of at least
6 three (3) months before returning to work for any employer.
7 (b) [As an alternative to the separation-from-service requirements in paragraph
8 (a) of this subsection, a retired member who is returning to work for the same
9 employer in a full-time position under subsections (1) and (2) of this section
10 may elect a separation-from-service of not less than two (2) months followed
11 by a forfeiture of the retired member's retirement allowance on a month-to-
12 month basis for each month that the member has separated from service for
13 less than twelve (12) full months. A retired member returning to work for the
14 same employer in a part-time position, or for a different employer in a full-
15 time position, may elect an alternative separation-from-service requirement of
16 at least two (2) months followed by a forfeiture of the member's retirement
17 allowance for one (1) month. During the period that the member forfeits his or
18 her retirement allowance and thereafter, member and employer contributions
19 shall be made to the retirement system as a result of employment in any
20 position subject to membership in the retirement system. The member shall
21 contribute to an account with the retirement system subject to the conditions
22 set forth in subsection (4) of this section.
23 (c) ]A retired member who is returning to work for an employer that has
24 employees who participate in the Teachers' Retirement System shall comply
25 with the separation-from-service requirements in this subsection before
26 performing any service for the employer, regardless of whether the retired
27 member is providing service in a position covered by the Teachers'
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1 Retirement System.
2 (c)[(d)] The starting date for any separation from service required under this
3 subsection shall be the effective date of the member's retirement.
4 (d)[(e) ] The separation-from-service requirements of this subsection are not met
5 if there is a prearranged agreement between the member and an employer that
6 has employees who participate in the Teachers' Retirement System prior to
7 retirement for the member to work for the employer after retirement.
8 (e)[(f)] The Teachers' Retirement System may require the member and the
9 employer for which the member is returning to work to certify in writing on a
10 form prescribed by the Teachers' Retirement System that no prearranged
11 agreement was or will be entered into between the member and employer
12 prior to retirement for the member to work for the employer after retirement.
13 (f)[(g)] Failure to comply with the separation-from-service requirements in this
14 subsection voids a member's retirement and the member shall be required to
15 return all the retirement benefits he or she received, with interest, for the
16 period of time that the member returned to work without a sufficient
17 separation from service;
18 (7) (a) Effective July 1, 2004, local school districts may employ retired members in
19 full-time or part-time teaching or administrative positions in critical shortage
20 areas without limitation on the compensation of the retired members that is
21 otherwise required by subsections (1) and (2) of this section. The number of
22 retired members that a local school district may employ under this subsection
23 shall be no more than four (4) members per local school district or ten percent
24 (10%) of the total active members employed by the local school district on a
25 full-time basis as defined under KRS 161.220(21), whichever number is
26 greater. Retired members returning to work under this subsection shall be
27 subject to the separation-from-service requirements set forth in subsection (6)
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1 of this section. Retired members returning to work under this subsection shall
2 waive their medical insurance coverage with the retirement system during
3 their period of reemployment and receive medical insurance coverage that is
4 offered by the member's active employer[offered to other full-time members
5 employed by the local school district]. Retired members returning to work
6 under this subsection shall contribute to an account subject to the conditions
7 set forth in subsection (4) of this section. Retired members returning to work
8 under this subsection shall make contributions to the retirement system at the
9 rate provided under KRS 161.540. The employer shall make contributions at
10 the rate provided under KRS 161.550. Local school districts shall make
11 annual payments to the retirement system on the compensation paid to the
12 reemployed retirees at the rates determined by the retirement system's actuary
13 that reflect any accrued liability resulting from the reemployment of these
14 members.
15 (b) The Department of Education may employ retired members in full-time or
16 part-time teaching or nonteaching positions without the limitations on
17 compensation otherwise required by subsections (1) and (2) of this section to
18 fill critical shortage areas in the schools it operates, including the Kentucky
19 School for the Blind and the Kentucky School for the Deaf, and to serve on
20 audit teams. The department shall be subject to the same requirements as local
21 school districts as provided in paragraph (a) of this subsection, except the
22 Teachers' Retirement System shall determine the maximum number of
23 employees that may be employed under this paragraph;
24 (8) The return-to-work limitations set forth in this section shall apply to retired
25 members who are returning to work in the same position from which they retired, or
26 a position substantially similar to the one from which they retired, or a position
27 described in KRS 161.046 or any position listed in KRS 161.220(4) which requires
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1 membership in the retirement system. Positions which generally require
2 certification or graduation from a four (4) year college or university as a condition
3 of employment which are created, or changed to remove the position from coverage
4 under KRS 161.220(4) are also subject to the return to work limitations set forth in
5 this section. The board of trustees shall determine whether employment in a
6 nonteaching position is subject to this subsection;
7 (9) (a) Notwithstanding the provisions of this section, individuals who become
8 members on or after January 1, 2022, who subsequently retire and begin
9 drawing a monthly lifetime retirement allowance from the Teachers'
10 Retirement System, who following retirement are reemployed with an
11 employer participating in the Teachers' Retirement System, shall not be
12 eligible to contribute to or earn benefits in a second retirement account in the
13 Teachers' Retirement System during the period of reemployment.
14 (b) The provisions of subsections (1) to (7) of this section are not subject to KRS
15 161.714;
16 (10) Retired members may be employed in a part-time teaching capacity by an agency
17 described in KRS 161.220(4)(b) or (n), not to exceed the equivalent of twelve (12)
18 teaching hours in any one (1) fiscal year. Retired members may be employed for a
19 period not to exceed the equivalent of one hundred (100) days in any one (1) fiscal
20 year in a part-time administrative or nonteaching capacity by an agency described
21 in KRS 161.220(4)(b) or (n) in a position that would otherwise be covered by the
22 retirement system. Except as otherwise provided by this subsection, the return to
23 work provisions set forth in subsections (1) to (7) of this section shall not apply to
24 retired members who return to work solely for an agency described in KRS
25 161.220(4)(b) or (n). Calculation of the number of days and teaching hours for part-
26 time teaching, substitute teaching, or part-time employment in a nonteaching
27 capacity under this section shall not exceed the ratio between a school year and the
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1 actual months of retirement for the member during that school year. The board of
2 trustees by administrative regulation may establish fractional equivalents of a day
3 of teaching service. Any member who exceeds the twelve (12) hour or one hundred
4 (100) day limitations of this subsection shall be subject to having his or her
5 retirement voided and be required to return all retirement allowances and other
6 benefits paid to the member or on the member's behalf since the effective date of
7 retirement. In lieu of voiding a member's retirement, the system may reduce the
8 member's retirement allowance or any other benefit to which the member would
9 otherwise be entitled on a dollar-for-dollar basis for each dollar of compensation
10 that the member earns in employment exceeding twelve (12) hours, one hundred
11 (100) days, or any apportionment of the two (2) combined. Retired members
12 returning to work for an employer described in KRS 161.220(4)(b) or (n) shall
13 comply with the separation-from-service requirements of subsection (6) of this
14 section;
15 (11) When a retired member returns to employment in a part-time teaching capacity or
16 in a nonteaching capacity as provided in subsection (10) of this section, the
17 employer shall contribute annually to the retirement system on the compensation
18 paid to the retired member at rates determined by the retirement system actuary that
19 reflect accrued liability for retired members who return to work under subsection
20 (10) of this section; and
21 (12) For retired members who return to work during any one (1) fiscal year in both a
22 position described in KRS 161.220(4)(b) or (n) and in a position described under
23 another provision under KRS 161.220(4), and for retired members who return to
24 work in a position described under KRS 161.220(4)(b) or (n) in both a teaching and
25 an administrative or nonteaching capacity, the board of trustees shall adopt a
26 methodology for a pro rata apportionment of days and hours that the retired
27 member may work in each position.
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1 (13) Notwithstanding any other provision of KRS 161.220 to 161.716 to the contrary, an
2 annuitant who has returned to work following retirement with an employer that
3 does not participate in the state-administered retirement systems shall not be
4 required to take health insurance coverage through the employer and the system
5 shall continue to provide health insurance coverage and benefits to the annuitant
6 during the period of employment, except as may be required by the Medicare
7 Secondary Payer Act under 42 U.S.C. sec. 1395y(b).
8 (14) Any member retired by reason of service may waive his or her annuity and return
9 to full-time employment in a Teachers' Retirement System-covered position that is
10 on the certified salary schedule under the following conditions:
11 (a) The member shall:
12 1. Receive no annuity payments while employed in a full-time position
13 described in this subsection;
14 2. Make contributions on the salaries received for the service in a full-
15 time position;
16 3. If employed for at least one (1) consecutive contract year in a full-time
17 position, have his or her retirement annuity recalculated as provided
18 in the regular retirement formula in subsection (1) of Section 4 of this
19 Act, except that, regardless of salaries earned during waiver, a
20 monthly retirement allowance recalculated under this paragraph shall
21 not be increased by more than ten percent (10%) per full contract year
22 of waiver worked or a prorated percentage for a year during waiver
23 when less than a full contract year was worked. The recalculated
24 retirement allowance shall be less any applicable actuarial discount
25 applied to the original retirement allowance due to the election of a
26 joint and last survivor option; and
27 4. Waive his or her medical insurance coverage with the Teachers'
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1 Retirement System during the period of reemployment and instead
2 shall receive the medical insurance coverage that is generally offered
3 by the member's active employer;
4 (b) 1. The member's estate or, if there is a beneficiary applicably designated
5 by the member, then the beneficiary, shall continue to be eligible for
6 life insurance benefits as provided in KRS 161.655.
7 2. Retirement option, plan account type, and beneficiary designation on
8 original retirement shall not be altered by postretirement employment
9 under this subsection, and dependents and spouses of the members
10 shall not become eligible for benefits under KRS 161.525 or 161.661
11 or Section 1 of this Act due to postretirement employment;
12 (c) 1. When a member returns to a full-time position described in this
13 subsection and as provided in paragraph (a) of this subsection, the
14 employer is required to withhold and remit regular retirement
15 contributions.
16 2. The member shall be returned to the annuity rolls on July 1 following
17 completion of the contract year or on the first day of the month
18 following the month of termination of service. A member shall not be
19 returned to the annuity rolls until after he or she has filed a retirement
20 application in compliance with KRS 161.600(6). Any discounts applied
21 at the time of the original retirement due to service or age may be
22 reduced or eliminated in the recalculation subject to the ten percent
23 (10%) cap in paragraph (a) of this subsection; and
24 (d) A member retired by reason of service who has been employed the
25 equivalent of twenty-five (25) days or more during a school year under
26 Section 2 of this Act may waive the member's retirement annuity and return
27 to a position described in this subsection during that school year a
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1 maximum of one (1) time during any five (5) year period, beginning with
2 that school year.
3 Section 3. KRS 161.608 is amended to read as follows:
4 The provisions of KRS 61.680 are hereby recognized and shall be followed in
5 calculating[computing] benefits of any member of the Teachers' Retirement System who
6 also has an account with the Kentucky Employees Retirement System, County
7 Employees Retirement System, or State Police Retirement System. The benefits shall be
8 calculated using a membership date as follows:
9 (1) Teachers' Retirement System shall use the other state-administered retirement
10 systems' membership entry date to establish eligibility for and participation in
11 benefits if it is the earlier membership entry date between the systems, and this
12 date shall not be subsequently changed once entered in the member's record; and
13 (2) For individuals who begin participation in the Teacher's Retirement System on or
14 after July 1, 2026, service subsequently reinstated or established in another
15 system for an earlier period or date shall not change the individual's continued
16 participation in the Teachers' Retirement System account type in which they
17 participated prior to the reinstatement.
18 Section 4. KRS 161.620 is amended to read as follows:
19 (1) The retirement allowance, in the form of a life annuity with refundable balance, of a
20 member retiring for service shall be calculated as follows:
21 (a) For retirements effective July 1, 1998, and thereafter, except as otherwise
22 provided by this section, the annual allowance for each year of service shall
23 be two percent (2%) of the final average salary for service performed prior to
24 July 1, 1983, and two and one-half percent (2.5%) of the final average salary
25 for service performed after July 1, 1983, for all nonuniversity members.
26 Except as otherwise provided by this section, the annual retirement allowance
27 for each year of service performed by members of the Teachers' Retirement
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1 System who are university members shall be two percent (2%) of the final
2 average salary. Actuarial discounts due to age or service credit at retirement
3 may be applied as provided in this section;
4 (b) For individuals who become nonuniversity members of the Teachers'
5 Retirement System on or after July 1, 2002, and before July 1, 2008, who
6 upon retirement have earned less than ten (10) full years of service credit, the
7 retirement allowance shall be two percent (2%) of the member's final average
8 salary for each year of service. For individuals who become nonuniversity
9 members of the Teachers' Retirement System on or after July 1, 2002, and
10 before July 1, 2008, and who upon retirement have earned at least ten (10) full
11 years of service credit, the annual allowance for each year of service shall be
12 two and one-half percent (2.5%) of the member's final average salary;
13 (c) The board of trustees may approve for members who initially retire on or after
14 July 1, 2004, and who become nonuniversity members before July 1, 2008, a
15 retirement allowance of three percent (3%) of the member's final average
16 salary for each year or partial year of service credit earned in excess of thirty
17 (30) years. This three percent (3%) factor shall be in lieu of the two and one-
18 half percent (2.5%) factor provided for in paragraph (b) of this subsection for
19 every year or fraction of a year of service in excess of thirty (30) years. Upon
20 approval of this three percent (3%) retirement factor, the board of trustees
21 may establish conditions of eligibility regarding the type of service credit that
22 will qualify for meeting the requirements of this subsection. This subsection is
23 optional with the board of trustees and shall not be subject to KRS 161.714;
24 (d) For individuals who become nonuniversity members of the Teachers'
25 Retirement System on or after July 1, 2008, but prior to January 1, 2022, the
26 retirement allowance shall be:
27 1. a. One and seven-tenths percent (1.7%) of the member's final
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1 average salary for each year of service if the member has earned
2 ten (10) or less years of service at retirement;
3 b. Two percent (2%) of the member's final average salary for each
4 year of service if the member has earned greater than ten (10) but
5 no more than twenty (20) years of service at retirement;
6 c. Two and three-tenths percent (2.3%) of the member's final average
7 salary for each year of service if the member has earned greater
8 than twenty (20) but no more than twenty-six (26) years of service
9 at retirement; or
10 d. Two and one-half percent (2.5%) of the member's final average
11 salary for each year of service if the member has earned greater
12 than twenty-six (26) but no more than thirty (30) years of service
13 at retirement; and
14 2. Three percent (3%) of the member's final average salary for each year or
15 partial year of service earned in excess of thirty (30) years of service at
16 retirement subject to the same terms and conditions as set forth in
17 paragraph (c) of this subsection;
18 (e) For individuals who become university members of the Teachers' Retirement
19 System on or after July 1, 2008, but prior to January 1, 2022, the retirement
20 allowance shall be:
21 1. One and one-half percent (1.5%) of the member's final average salary
22 for each year of service if the member has earned ten (10) or less years
23 of service at retirement;
24 2. One and seven-tenths percent (1.7%) of the member's final average
25 salary for each year of service if the member has earned greater than ten
26 (10) but no more than twenty (20) years of service at retirement;
27 3. One and eighty-five hundredths percent (1.85%) of the member's final
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1 average salary for each year of service if the member has earned greater
2 than twenty (20) but less than twenty-seven (27) years of service at
3 retirement; or
4 4. Two percent (2%) of the member's final average salary for each year of
5 service if the member has earned twenty-seven (27) or more years of
6 service at retirement;
7 (f) For individuals who become nonuniversity members of the Teachers'
8 Retirement System on or after January 1, 2022, the retirement allowance shall,
9 except as adjusted by the board pursuant to KRS 161.633, be the following
10 percentage of the member's final average salary for each year of service:
11 1. One and seven-tenths percent (1.7%), which shall be increased
12 incrementally each month the member's age at retirement is greater than
13 sixty (60) so that the incremental increase is four one-hundredths of one
14 percent (0.04%) for each complete additional year of age at retirement in
15 excess of sixty (60), not to exceed a value of one and nine-tenths percent
16 (1.9%) at age sixty-five (65) or greater; plus
17 2. a. One-quarter of one percent (0.25%), if the member has earned at
18 least twenty (20) but less than thirty (30) years of service at
19 retirement; or
20 b. One-half of one percent (0.50%), if the member has earned thirty
21 (30) or more years of service at retirement;
22 (g) For individuals who become university members of the Teachers' Retirement
23 System on or after January 1, 2022, the retirement allowance shall, except as
24 adjusted by the board pursuant to KRS 161.634, be the following percentage
25 of the member's final average salary for each year of service:
26 1. Seven-tenths of one percent (0.7%), which shall be increased
27 incrementally each month the member's age at retirement is greater than
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1 sixty (60) so that the incremental increase is four one-hundredths of one
2 percent (0.04%) for each complete additional year of age in excess of
3 sixty (60), not to exceed a value of nine-tenths of one percent (0.9%) at
4 age sixty-five (65) or greater; plus
5 2. a. One-quarter of one percent (0.25%), if the member has earned at
6 least twenty (20) but less than thirty (30) years of service at
7 retirement; or
8 b. One-half of one percent (0.50%), if the member has earned thirty
9 (30) or more years of service at retirement; and
10 (h) The retirement allowance of a member at retirement, as measured on a life
11 annuity, shall not exceed the member's last yearly salary or the member's final
12 average salary, whichever is the greater amount. For purposes of this section,
13 "yearly salary" means the compensation earned by a member during the most
14 recent period of contributing service, either consecutive or nonconsecutive,
15 preceding the member's effective retirement date and shall be subject to the
16 provisions of KRS 161.220(9) and (10). This paragraph shall not apply to the
17 supplemental benefit component.
18 (2) Effective July 1, 2002, and annually on July 1 thereafter, the retirement allowance
19 of each retired member and of each beneficiary of a retirement option shall be
20 increased in the amount of one and one-half percent (1.5%), provided the retired
21 member had been retired for at least the full twelve (12) months immediately
22 preceding the date that the increase is effective. In the event that the retired member
23 had been retired for less than the full twelve (12) months immediately preceding the
24 date that the increase is effective, then the increase shall be reduced on a pro rata
25 basis by each month that the retired member had not been retired for the full twelve
26 (12) months immediately preceding the effective date of the increase. This
27 subsection shall not apply to benefits from the supplemental benefit component, and
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1 the board may adjust this value for individuals who become members on or after
2 January 1, 2022, as provided by KRS 161.633 or 161.634, as applicable.
3 (3) Any member qualifying for retirement under a life annuity with refundable balance
4 shall be entitled to receive an annual allowance amounting to not less than four
5 hundred dollars ($400) effective July 1, 2002, and not less than four hundred forty
6 dollars ($440) effective July 1, 2003, multiplied by the service credit years of the
7 member. These minimums shall apply to the retired members receiving annuity
8 payments and to those members retiring on or subsequent to the effective dates
9 listed in this subsection, except the following:
10 (a) Individuals who become members of the Teachers' Retirement System on or
11 after July 1, 2008; or
12 (b) Members whose retirement allowance payment is reduced below the
13 minimum allowance as a result of its division in a qualified domestic relations
14 order or any other provision permitted under KRS 161.700.
15 (4) The minimum retirement allowance provided in this section shall apply in the case
16 of members retired or retiring under an option other than a life annuity with
17 refundable balance in the same proportion to the benefits of the member and his or
18 her beneficiary or beneficiaries as provided in the duly-adopted option tables at the
19 time of the member's retirement.
20 (5) Effective July 1, 2008, the monthly allowance of each retired member and each
21 recipient of a retirement option of the retired member may be increased in an
22 amount not to exceed three and one-half percent (3.5%) of the monthly allowance
23 in effect the previous month, provided the retired member had been retired for at
24 least the full twelve (12) months immediately preceding the date that the increase is
25 effective. In the event that the retired member had been retired for less than the full
26 twelve (12) months immediately preceding the date that the increase is effective,
27 then the increase shall be reduced on a pro rata basis by each month that the retired
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1 member had not been retired for the full twelve (12) months immediately preceding
2 the effective date of the increase. The level of increase provided for in this
3 subsection shall be determined by the funding provided in the 2008-2010 biennium
4 budget appropriation.
5 (6) Effective July 1, 2009, the monthly allowance of each retired member and each
6 recipient of a retirement option of the retired member may be increased in an
7 amount not to exceed seven-tenths of one percent (0.7%) of the monthly allowance
8 in effect the previous month, provided the retired member had been retired for at
9 least the full twelve (12) months immediately preceding the date that the increase is
10 effective. In the event that the retired member had been retired for less than the full
11 twelve (12) months immediately preceding the date that the increase is effective,
12 then the increase shall be reduced on a pro rata basis by each month that the retired
13 member had not been retired for the full twelve (12) months immediately preceding
14 the effective date of the increase. The level of increase provided for in this
15 subsection shall be determined by the funding provided in the 2008-2010 biennium
16 budget appropriation.
17 (7) Effective July 1, 1990, monthly payments of two hundred dollars ($200) shall be
18 payable for the benefit of an adult child of a member retired for service when the
19 child's mental or physical condition is sufficient to cause dependency on the
20 member at the time of retirement. Eligibility for this payment shall continue for the
21 life of the child or until the time the mental or physical condition creating the
22 dependency no longer exists or the child marries. Benefits under this subsection
23 shall apply to legally adopted survivors provided the proceedings for the adoption
24 were initiated at least one (1) year prior to the death of the member. The board of
25 trustees shall be the sole judge of eligibility or dependency and may require formal
26 application or information relating thereto. This payment may be applied for and
27 managed by the parent who is the retired member without necessity of court order
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1 or other legal authority.
2 (8) Members of the Teachers' Retirement System shall be subject to the annuity income
3 limitations imposed by Section 415 of the Internal Revenue Service Code.
4 (9) Compensation in excess of the limitations imposed by Section 401(a)(17) of the
5 Internal Revenue Code shall not be used in determining a member's retirement
6 annuity. The limitation on compensation for eligible members shall not be less than
7 the amount which was allowed to be taken into account by the retirement system in
8 effect on July 1, 1993. For this purpose, an eligible member is an individual who
9 was a member of the retirement system before the first plan year beginning after
10 December 31, 1995.
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HB064210.100 - 2029 - XXXX 3/25/2026 11:57 AM GAEvery fact on this page links to its source, starting with the official bill record.