KRS § 6.518 — KY Code / Title II / Chapter 6 / Section 6.518
6.518 Limitations and exclusions on increases in creditable compensation in last five years of service in General Assembly for members retiring on or after January 1, 2018 -- Exceptions for bona fide promotion or career development -- Exclusion -- Determination by board -- Administrative regulations -- Inapplicability to hybrid cash balance participants
Status: in_force

6.518 Limitations and exclusions on increases in creditable compensation in last

five years of service in General Assembly for members retiring on or after

January 1, 2018 -- Exceptions for bona fide promotion or career development -

- Exclusion -- Determination by board -- Administrative regulations --

Inapplicability to hybrid cash balance participants.

(1) For purposes of this section, "bona fide promotion or career advancement":

(a) Means a professional advancement in substantially the same line of work held

by the member in the four (4) years immediately prior to the final five (5)

annual years preceding retirement or a change in employment position based

on the training, skills, education, or expertise of the member that imposes a

significant change in job duties and responsibilities to clearly justify the

increased compensation to the member; and

(b) Does not include any circumstance in which a legislator participating in the

Legislators' Retirement Plan takes a position of employment with an employer

participating in any of the other state-administered retirement systems.

(2) (a) For members retiring on or after January 1, 2018, the plan shall, for each of

the retiring member's last five (5) annual years of service in the General

Assembly or with any employer participating in any of the state-administered

retirement systems, identify any annual year in which the creditable

compensation used to calculate benefits in the Legislators' Retirement Plan

increased at a rate of ten percent (10%) or more annually over the immediately

preceding annual year's creditable compensation.

(b) Except as limited or excluded by subsections (3) and (4) of this section, any

amount of increase in creditable compensation for an annual year identified

under paragraph (a) of this subsection that exceeds ten percent (10%) more

than the member's creditable compensation from the immediately preceding

annual year shall not be included in the creditable compensation used to

calculate the member's monthly pension benefits. If the creditable

compensation for a specific annual year identified under paragraph (a) of this

subsection as exceeding the ten percent (10%) increase limitation is not used

to calculate the retiring member's monthly pension benefits, then no reduction

in creditable compensation shall occur for that annual year. Reductions to

creditable compensation as provided by this paragraph shall include any

creditable compensation used to calculate the retiring member's benefits,

including creditable compensation earned in another state-administered

retirement system.

(c) If the creditable compensation of the retiring member is reduced as provided

by paragraph (b) of this subsection, the retirement system shall,

notwithstanding KRS 21.460 and as applicable, refund the member

contributions attributable to the reduction in creditable compensation.

(3) In order to ensure the prospective application of the limitations on increases in

creditable compensation contained in subsection (2) of this section, only the

creditable compensation earned by the retiring member on or after July 1, 2017,

shall be subject to reduction under subsection (2) of this section. Creditable

compensation earned by the retiring member prior to July 1, 2017, shall not be

subject to reduction under subsection (2) of this section.

(4) Subsections (2) and (3) of this section shall not apply to increases that are the direct

result of a bona fide promotion or career advancement.

(5) The Judicial Form Retirement System board of trustees shall determine whether

increases in creditable compensation during the last five (5) annual years of

employment prior to retirement constitute a bona fide promotion or career

advancement and may promulgate administrative regulations in accordance with

KRS Chapter 13A to administer this section. All state-administered retirement

systems shall cooperate to implement this section.

(6) This section shall not apply to employees participating in the hybrid cash balance

plan as provided by KRS 21.402.