KRS § 61.691 — KY Code / Title VIII / Chapter 61 / Section 61.691
61.691 Increase of benefits
Status: in_force

61.691 Increase of benefits.

(1) Effective August 1, 1996, to July 1, 2008, a recipient of a retirement allowance

under KRS 16.505 to 16.652 and 61.510 to 61.705 shall have his or her

retirement allowance increased on July 1 of each year by the percentage

increase in the annual average of the consumer price index for all urban

consumers for the most recent calendar year as published by the federal

Bureau of Labor Statistics, not to exceed five percent (5). In determining the

annual employer contribution rate, only the cost of increases granted as of the

most recent valuation date shall be recognized. The benefits of this subsection

as provided on August 1, 1996, to July 1, 2008, shall not be considered as

benefits protected by the inviolable contract provisions of KRS 16.652 and

61.692. The General Assembly reserves the right to suspend or reduce the

benefits conferred in this subsection if in their judgment the welfare of the

Commonwealth so demands.

(2) (a) Effective July 1, 2009, and on July 1 of each year thereafter, a recipient of

a retirement allowance under KRS 16.505 to 16.652 and 61.510 to 61.705

shall have his or her retirement allowance increased by one and one-half

percent (1.5), if:

1. The funding level of the system is greater than one hundred percent

(100) and subsequent legislation authorizes the use of any surplus

actuarial assets to provide an increase in retirement allowances

described by this subsection for the system which has the surplus

actuarial assets; or

2. The General Assembly appropriates sufficient funds or directs

payment of funds to fully prefund the increase described by this

subsection in the year the increase is provided.

(b) The board of trustees of the Kentucky Retirement Systems shall, at least

thirty (30) days prior to the beginning of regular sessions of the General

Assembly held in even-numbered years, advise the General Assembly of

the following:

1. Which systems have a funding level greater than one hundred

percent (100) and can support an increase in recipients' retirement

allowances as provided by paragraph (a) of this subsection over the

next budget biennium without reducing the funding level of the

system below one hundred percent (100); and

2. If no surplus actuarial assets are available, the level of funds

needed to fully prefund an increase for system recipients over the

next budget biennium if a one and one-half percent (1.5) increase

is provided annually over the biennium.

(c) For purposes of this subsection, "funding level" means the actuarial value

of assets divided by the actuarially accrued liability expressed as a

percentage that is determined and reported by the system's actuary in the

system's actuarial valuation.

(d) The full increase described by this subsection shall only be provided if the

recipient has been receiving a benefit for at least twelve (12) months prior

to the effective date of the increase. If the recipient has been receiving a

benefit for less than twelve (12) months prior to the effective date of the

increase provided by this subsection, the increase shall be reduced on a

pro rata basis for each month the recipient has not been receiving

benefits in the twelve (12) months preceding the effective date of the

increase.

(e) In determining the annual employer contribution rate, only the cost of

increases granted as of the most recent valuation date shall be

recognized.

(f) The benefits of this subsection as provided on July 1, 2009, and

thereafter shall not be considered as benefits protected by the inviolable

contract provisions of KRS 16.652 and 61.692. The General Assembly

reserves the right to suspend or reduce the benefits conferred in this

subsection if, in its judgment, the welfare of the Commonwealth so

demands.

(3) A reemployed retired member whose payments are suspended as provided

under KRS 61.637 shall be eligible for an increase in his or her suspended

retirement allowance as provided under this section, computed as if he or she

were receiving the retirement allowance at the time the increase under this

section is effective.

(4) In addition to the increase to a recipient's retirement allowance as provided by

subsection (2) of this section, the General Assembly may, by subsequent

legislation, provide supplemental increases to a recipient's retirement

allowance to help adjust for actual changes in the recipient's cost of living if the

General Assembly appropriates sufficient funds to fully prefund the benefit in

the year the increase is provided.