KRS § 161.635 — KY Code / Title XIII / Chapter 161 / Section 161.635
161.635 Supplemental component for persons who became nonuniversity members on or after January 1, 2022 -- Benefit -- Contributions -- Election upon termination of employment and upon retirement -- Plans authorized under Internal Revenue Code
Status: in_force

161.635 Supplemental component for persons who became nonuniversity members

on or after January 1, 2022 -- Benefit -- Contributions -- Election upon

termination of employment and upon retirement -- Plans authorized under

Internal Revenue Code.

(1) An individual who becomes a nonuniversity member of the Teachers' Retirement

System on or after January 1, 2022, shall receive the retirement benefits provided

by this section in addition to the retirement benefits provided under KRS 161.620.

The retirement benefits provided by this section shall be known as the supplemental

benefit component.

(2) The supplemental benefit component shall provide a benefit based upon a member's

accumulated account balance which shall include:

(a) Mandatory contributions made by the member as provided by KRS

161.540(1)(c)2.;

(b) Voluntary contributions made by the member, which may include lump-sum

payments;

(c) Mandatory contributions made by the employer as provided by KRS

161.550(1)(d)2.;

(d) Voluntary employer contributions at the option of the employer, which may

include but not be limited to a voluntary employer contribution to attract and

retain new teachers of one thousand dollars ($1,000) for each of the first five

(5) years of contributing service to the system; and

(e) Regular interest, which shall be credited to the member's account annually on

June 30 of each fiscal year, by multiplying the member's accumulated account

balance in the supplemental benefit component on June 30 of the preceding

fiscal year by the regular interest rate.

(3) (a) Member contributions and employer contributions as provided by subsection

(2)(a) to (d) of this section shall be credited to the member's account at least

monthly as contributions are reported and posted to the system in accordance

with KRS 161.560.

(b) No employer contributions or interest shall be provided to a member who has

taken a refund of his or her accumulated account balance as provided by KRS

161.470 or who has retired and annuitized his or her accumulated account

balance as authorized by this section.

(4) (a) Upon termination of employment, a member who has less than five (5) years

of service credited under KRS 161.500, who elects to take a refund of his or

her accumulated account balance as provided by KRS 161.470, shall forfeit

the accumulated employer contribution, and shall only receive a refund of his

or her accumulated contributions.

(b) Upon termination of employment, a member who has five (5) or more years

of service credited under KRS 161.500, who elects to take a refund of his or

her accumulated account balance as provided by KRS 161.470, shall receive a

full refund of his or her accumulated account balance.

(5) A nonuniversity member eligible to retire under KRS 161.600(2) may upon

retirement, in addition to the other benefits provided by KRS 161.620, elect to:

(a) Have all or a portion of his or her accumulated account balance in the

supplemental benefit component annuitized into a lifetime monthly retirement

allowance by the system in accordance with the actuarial assumptions and

actuarial methods adopted by the board for the supplemental benefit

component and in effect on the member's retirement date;

(b) Receive the actuarial equivalent of his or her retirement allowance calculated

under paragraph (a) of this subsection payable under one (1) of the options

established by the board pursuant to KRS 161.630;

(c) Take a distribution of the accumulated account balance in the supplemental

benefit component over a period certain as authorized by the board; or

(d) Take a full or partial refund of his or her accumulated account balance as

provided by KRS 161.470.

A member participating in the supplemental benefit component shall not be

required to take a distribution or annuitize his or her accumulated account balance

in the supplemental benefit component when he or she begins drawing a retirement

allowance from the foundational benefit component and may instead choose to

begin drawing a distribution or annuitize his or her accumulated account balance in

the supplemental benefit component at any date following his or her retirement date

from the foundational benefit component.

(6) This section only applies to individuals who become nonuniversity members of the

Teachers' Retirement System on or after January 1, 2022.

(7) The board of trustees shall have the authority to utilize or establish any plan or

plans authorized under the Internal Revenue Code to provide the benefits set forth

in this section.