KRS § 61.670 — KY Code / Title VIII / Chapter 61 / Section 61.670
61.670 Duties of board -- Actuarial tables, valuations, investigations, and analyses -- Audit -- Actuary for Legislative Research Commission
Status: in_force

61.670 Duties of board -- Actuarial tables, valuations, investigations, and analyses -

- Audit -- Actuary for Legislative Research Commission.

(1) (a) As soon as practicable after its organization, the board shall adopt the

actuarial tables necessary for the administration of the system and for the

annual determination of actuarial assets and liabilities of the system.

(b) The board shall cause an actuarial valuation to be made annually. The

valuation shall at a minimum include:

1. A description of the actuarial assumptions used in the actuarial

valuation, which shall be reasonably related to the experience of the

system and represent the actuary's best estimate of anticipated

experience;

2. A description of any funding methods utilized or required by state law in

the development of the actuarial valuation results;

3. A description of any changes in actuarial assumptions and methods from

the previous year's actuarial valuation;

4. The actuarially recommended contribution rate for employers for the

upcoming budget periods;

5. A thirty (30) year projection of the funding levels, unfunded liabilities,

and actuarially recommended contribution rates for employers based

upon the actuarial assumptions, funding methods, and experience of the

system as of the valuation date; and

6. A sensitivity analysis that evaluates the impact of changes in system

assumptions, including but not limited to the investment return

assumption, payroll growth assumption, and medical inflation rates, on

employer contribution rates, funding levels, and unfunded liabilities.

(c) 1. At least once in each two (2) year period, the board shall cause an

actuarial investigation to be made of all of the economic experience

under the retirement system, including but not limited to the inflation

rate, investment return, and payroll growth assumptions, relative to the

economic assumptions and funding methods previously adopted by the

board.

2. At least once in each five (5) year period, the board shall cause an

actuarial investigation to be made of all the demographic experience

under the retirement system, including but not limited to mortality

tables, withdrawal rates, and retirement rate assumptions, relative to the

demographic actuarial assumptions previously adopted by the board.

3. Each actuarial investigation shall include at a minimum a summary of

the changes in actuarial assumptions and funding methods recommended

in the investigation and the projected impact of the recommended

changes on funding levels, unfunded liabilities, and actuarially

recommended contribution rates for employers over a thirty (30) year

period.

(d) Pursuant to the actuarial investigations, the board shall, from time to time,

revise the actuarial tables previously adopted by the board and shall thereupon

revise the bases of the rates of contributions required under KRS 61.510 to

61.692 and KRS 16.505 to 16.652.

(e) For any change in actuarial assumptions, funding methods, retiree health

insurance premiums and subsidies, or any other decisions made by the board

that impact system liabilities and actuarially recommended contribution rates

for employers and that are not made in conjunction with the actuarial

investigations required by paragraph (c) of this subsection, an actuarial

analysis shall be completed showing the projected impact of the changes on

funding levels, unfunded liabilities, and actuarially recommended contribution

rates for employers over a thirty (30) year period.

(f) All actuarial investigations, analyses, and valuations shall be certified to the

board by an actuary who shall be a fellow of the Conference of Consulting

Actuaries or a member of the American Academy of Actuaries.

(2) A copy of each actuarial investigation, actuarial analysis, and annual valuation

required by subsection (1) of this section shall be forwarded electronically to the

Legislative Research Commission no later than ten (10) days after receipt by the

board, and the Legislative Research Commission shall distribute the information

received to the committee staff and co-chairs of any committee that has jurisdiction

over the Kentucky Retirement Systems. The actuarial valuation required by

subsection (1)(b) of this section shall be submitted no later than November 15

following the close of the fiscal year.

(3) The Legislative Research Commission may employ an actuary with the same

qualifications as the actuary employed by the board, and the board shall, free of

charge, provide the actuary employed by the Commission with the same data

provided to its own actuary, and any supplementary data he or she may require. The

actuary employed by the Commission shall review the assumptions, determinations

and recommendations of the board actuary, and legislative proposals related to the

retirement systems, and report his or her findings to the Commission and to the

board. Except as provided by KRS 7A.240(5), the board shall pay fifty percent

(50%) of the cost of the Commission's actuary, and the Commission shall pay the

other fifty percent (50%).