Section 78.5512 - Hybrid cash balance plan for members in nonhazardous positions who began participating on or after January 1, 2014, and for members who make election under KRS 61.5955(1) A member of the County Employees Retirement System who is participating in a nonhazardous position and who began participating in the system on or after January 1, 2014, or a member who makes an election pursuant to KRS 61.5955, shall receive the retirement benefits provided by this section in lieu of the retirement benefits provided under KRS 78.5510. The retirement benefit provided by this section shall be known as the hybrid cash balance plan and shall operate as another benefit tier within the County Employees Retirement System.(2) The hybrid cash balance plan shall provide a retirement benefit based upon the member's accumulated account balance, which shall include:(a) Contributions made by the member as provided by KRS 78.510 to 78.852, except for employee contributions prescribed by KRS 78.5536(3)(b);(b) An employer pay credit of four percent (4%) of the creditable compensation earned by the employee for each month the employee is contributing to the hybrid cash balance plan provided by this section; and(c) Interest credits added annually to the member's accumulated account balance as provided by this section.(3)(a) Member contributions and employer pay credits as provided by subsection (2)(a) and (b) of this section shall be credited to the member's account monthly as contributions are reported and posted to the system in accordance with KRS 78.625.(b) Interest credits, as provided by subsection (2)(c) of this section, shall be credited to the member's account annually on June 30 of each fiscal year, as determined by subsection (4) of this section.(4)(a) On June 30 of each fiscal year, the system shall determine if the member contributed to the hybrid cash balance plan or the Kentucky Retirement Systems during the fiscal year.(b) If the member contributed to the hybrid cash balance plan or the Kentucky Retirement Systems during the fiscal year, the interest credit added to the member's account for that fiscal year shall be determined by multiplying the member's accumulated account balance on June 30 of the preceding fiscal year by a percentage increase equal to: 1. Four percent (4%); plus2. Seventy-five percent (75%) of the system's geometric average net investment return in excess of a four percent (4%) rate of return.(c) If the member did not contribute to the hybrid cash balance plan or the Kentucky Retirement Systems during the fiscal year, the interest credit added to the member's account for that fiscal year shall be determined by multiplying the member's accumulated account balance on June 30 of the preceding fiscal year by four percent (4%).(d) For purposes of this subsection, "system's geometric average net investment return": 1. Means the annual average geometric investment return, net of administrative and investment fees and expenses, over the last five (5) fiscal years as of the date the interest is credited to the member's account; and2. Shall be expressed as a percentage and based upon the system in which the member has an account.(e) No employer pay credits or interest credits shall be provided to a member who has taken a refund of contributions as provided by KRS 61.625 or who has retired and annuitized his or her accumulated account balance as prescribed by this section.(5)(a) Upon termination of employment, a member who has less than five (5) years of service credited under KRS 16.543(1), 61.543(1), and 78.615(1), who elects to take a refund of his or her accumulated account balance as provided by KRS 61.625, shall forfeit the accumulated employer credit, 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 16.543(1), 61.543(1), and 78.615(1), who elects to take a refund of his or her accumulated account balance as provided by KRS 61.625, shall receive a full refund of his or her accumulated account balance.(6) A member participating in the hybrid cash balance plan provided by this section may retire: (a) At his or her normal retirement age, provided he or she has earned five (5) or more years of service credited under KRS 16.543(1), 61.543(1), or 78.615(1), or another state-administered retirement system; or(b) If the member is at least age fifty-seven (57) and has an age and years of service total of at least eighty-seven (87) years. The years of service used to determine eligibility for retirement under this paragraph shall only include years of service credited under KRS 16.543(1), 61.543(1), or 78.615(1), or another state-administered retirement system.(7) A member eligible to retire under subsection (6) of this section may elect to: (a) Receive a monthly retirement allowance payable for life by having his or her accumulated account balance annuitized by the system in accordance with the actuarial assumptions and actuarial methods adopted by the board 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 set forth in KRS 61.635, except for the option provided by KRS 61.635(11); or(c) Take a refund of his or her account balance as provided by KRS 61.625.(8) The provisions of this section shall not apply to members who began participating in the Kentucky Employees Retirement System, County Employees Retirement System, or the State Police Retirement System prior to January 1, 2014, except as provided by KRS 61.5955.Effective: April 1, 2021
Created 2021 Ky. Acts ch. 102, sec. 2, effective April 1, 2021.
Added by 2021 Ky. Acts ch. 102,§ 2, eff. 4/1/2021.