KRS § 78.540 — KY Code / Title IX / Chapter 78 / Section 78.540
78.540 Membership -- Cessation
Status: in_force

78.540 Membership -- Cessation.

Membership in the system shall consist of the following:

(1) (a) All persons who become employees of a participating county after the date the

county first participates in the system, except that:

1. Mayors and members of city legislative bodies may decline prior to their

participation in the system; and

2. City managers or other appointed local government executives who

participate in a retirement system, other than Social Security, may

decline prior to their participation in the system;

(b) All persons who are employees of a county on the date the county first

participates in the system, either in service or on authorized leave from

service, and who elect within thirty (30) days next following the county's

participation, or in the case of persons on authorized leave, within thirty (30)

days of their return to active service, to become members and thereby agree to

make contributions as provided in KRS 78.520 to 78.852; and

(c) All persons electing coverage in the system under KRS 78.530(3)(d).

(2) The provisions of subsection (1)(a) and (b) of this section notwithstanding, cities

which participate in the CERS and close existing local pension systems to new, or

all members pursuant to the provisions of KRS 78.530, 95.520, 95.621, or 95.852

shall not be required to provide membership in the County Employees Retirement

System to employees in any employee category not covered by a city pension

system at the date of participation.

(3) Membership in the system shall not include:

(a) Persons who are not eligible to participate in the system as provided by KRS

78.535; or

(b) Employees who are simultaneously participating in another state-administered

defined benefit plan within Kentucky other than those administered by the

Kentucky Retirement Systems or the County Employees Retirement System.

(4) (a) The membership of any person in the system shall cease:

1. Upon withdrawal of his or her accumulated account balance at or any

time after termination of employment, regardless of length of service;

2. Upon retirement;

3. Upon death;

4. For persons hired prior to August 1, 2000, upon termination of

employment with prejudice, as defined by paragraph (b) of this

subsection; or

5. For persons hired on or after August 1, 2000, upon conviction of a

felony relating to the person's employment as provided in paragraph (c)

of this subsection.

(b) For purposes of KRS 78.510 to 78.852, termination of employment with

prejudice shall mean termination as the result of conviction of the member in

a court of competent jurisdiction of embezzlement or larceny of public funds

or property or malfeasance in office, or the forcing of a member to make

restitution for any funds or property criminally taken by the member at the

time of termination of employment.

(c) Notwithstanding any provision of law to the contrary, an employee hired on

or after August 1, 2000, who participates in the system and who is convicted,

in any state or federal court of competent jurisdiction, of a felony related to

his or her employment shall forfeit rights and benefits earned under the

system, except for the return of his or her accumulated contributions and

interest credited on those contributions. The payment of retirement benefits

ordered forfeited shall be stayed pending any appeal of the conviction. If the

conviction is reversed on final judgment, no retirement benefit shall be

forfeited. The employer shall notify the system when an employee is

convicted under the provisions of this subsection.

(d) When membership ceases, except in the case of retirement, the member shall

thereafter lose all right to any retirement allowance or benefits under KRS

78.510 to 78.852 arising from service prior to the date of such cessation of

membership.