95.290 Pension system for police and fire divisions -- Governing bodies -- Distribution of funds -- Administration expenses -- Equal protection for beneficiaries -- Participation by policemen and fire - Kentucky Statutes

Download pdf

Loading PDF...

95.290 Pension system for police and fire divisions -- Governing bodies -- Distribution of funds -- Administration expenses -- Equal protection for
beneficiaries -- Participation by policemen and firefighters in County
Employees Retirement System -- Contributions. (1) The city legislative body in cities of the first class may enact ordinances providing for a system of pensions for retired and disabled members of the police and fire
divisions of the department of public safety and their dependents, may appropriate
funds for the purpose of paying such pensions, may allot and pay to the policemen's
pension fund or the firefighters' pension fund or either or both of them, all fines and
forfeitures imposed upon members of the respective divisions, and may provide for,
assess, and collect contributions from the members for the benefit of the fund. (2) There shall be a governing body of the policemen's pension fund, and a governing body of the firefighters' pension fund. The governing bodies of the respective funds
shall hold title to all assets in their respective funds, and shall have exclusive
authority relating to investment of the assets of the funds, including contracting with
investment advisors or managers to perform investment services as deemed
necessary and prudent by the board. A majority of the governing body of each fund
shall be comprised of persons receiving pension benefits from the respective
pension systems, and no more than one (1) member of the city legislative body may
be a member of the governing body of either the policemen's or the firefighters'
pension fund. To be effective, an action of the governing body of a fund shall
require only a simple majority of the votes cast at a properly convened meeting of
the governing body where a quorum is present, with a quorum being a majority of
the members of a governing body. (3) Any policemen's pension fund or any firefighters' pension fund established under the provisions of this section shall be held or distributed for, and only for, any of the
following purposes of the respective fund as applicable:
(a) Paying pensions, and any bonus payments under applicable ordinances;
(b) Making payments to the city for transfer to the County Employees Retirement System for alternate participation pursuant to KRS 78.530(3)(a) and
78.531(2); (c) Transferring pension assets through investment contract or other financial instrument for the purpose of amortizing unfunded service liabilities; and (d) Payment from the city to the County Employees Retirement System for future pension contributions required pursuant to KRS 61.565. Pursuant to the terms of this section, if policemen of the city of the first class elect
entry into the County Employees Retirement System and thereby create excess
funds over those required to provide for the purposes set forth in paragraphs (a), (b),
and (c) of this subsection, these excess funds shall be distributed to the city for use
by the city for any other purpose it may elect, including, but not limited to, the
establishment of a reserve for payment under paragraph (d) of this subsection. The
governing board of the fund may annually expend for the necessary expenses
connected with the fund, including but not limited to expenses for medical, actuarial, accounting, and legal services, the amount such governing board deems
proper.
(e) Payment from the city to the County Employees Retirement System for future pension contributions required pursuant to KRS 61.565. Pursuant to the terms
of this section, if firefighters of the city of the first class elect entry into the
County Employees Retirement System and thereby create excess funds over
those required to provide for the purposes set forth in paragraphs (a), (b), and
(c) of this subsection, these excess funds shall be distributed according to the
terms of an agreement negotiated between the city and the union organization
representing the firefighters. The city may use its share of the distributed
excess funds for any purpose it may elect, including, but not limited to, the
establishment of a reserve for payment under paragraph (e) of this subsection. (4) (a) The governing body of each pension fund shall insure that all of the assets in the fund are distributed for the purposes in subsection (3) of this section, and
only for these purposes. If in any calendar year the assets in either fund exceed
those needed for the actuarial liability for payment of pension benefits and any
anticipated liabilities under subsection (3)(b) and (c) of this section, the
legislative body of the city establishing the pension system shall insure by
pension bonus ordinance that a portion of these excess funds be distributed in
an equitable manner to all eligible pension recipients. Nothing in this
subsection shall be construed to require any change to be made to any pension
ordinance as it exists on July 15, 1998. (b) The governing board of either fund may annually expend for the necessary expenses connected with the fund, including but not limited to expenses for
medical, actuarial, accounting, and legal or other professional services, the
amount such governing board deems proper. (5) Any ordinance establishing a pension fund under this section shall make equitable provision for the rights of persons having an interest in assets transferred to the fund
from any fund heretofore established by statute. (6) To assure equal protection for the beneficiaries of either fund, any action taken by the city executive or legislative body in cities of the first class that affects a
policemen's pension fund or a firefighters' pension fund established under this
section shall, to the maximum extent permitted by law, treat each fund in a uniform
manner and shall not cause any change to be made to the structure or operation of
either fund, whether through legislation, litigation, compromise, settlement, or
otherwise, unless any proposed change is offered to the other fund before it takes
effect. Nothing in this subsection shall be construed to require any change to be
made to any pension ordinance as it exists on July 15, 1998. (7) The legislative body in a city of the first class shall issue the appropriate order, pursuant to KRS 78.530(1), directing participation for policemen in the County
Employees Retirement System. All new employees who would have been granted
membership in the local policemen's pension system shall be members of the
County Employees Retirement System. All active members of the local policemen's
pension system at the time of transition to the County Employees Retirement System may choose membership in the County Employees Retirement System or
may retain membership in the local system. The city shall elect the alternate
participation plan, pursuant to KRS 78.530(3), for policemen who transfer to the
County Employees Retirement System. Notwithstanding the provisions of KRS
78.530(3)(b), the city may, at its option, extend the payment period for the cost of
alternate participation to a maximum of twenty (20) years with the interest at the
rate actuarially assumed by the board. The city shall have the right to use assets in
the local pension fund, other than assets necessary to pay benefits to the remaining
active members of the local policemen's pension system and to retirees and their
survivors as determined by actuarial evaluation, to assist in the payment of the
annual installment cost of alternate participation. All policemen who become
members of the County Employees Retirement System pursuant to this section shall
be granted hazardous duty coverage, and the city may, at its option, purchase
accumulated sick leave for each policeman upon retirement pursuant to KRS
78.616. (8) The legislative body in a city of the first class may issue the appropriate order, pursuant to KRS 78.530(1), directing participation for firefighters in the County
Employees Retirement System. In the event that the legislative body in a city of the
first class issues such an order, then all new employees who would have been
granted membership in the local firefighters' pension system shall be members of
the County Employees Retirement System. All active members of the local
firefighters' pension system at the time of transition to the County Employees
Retirement System may choose membership in the County Employees Retirement
System or may retain membership in the local system. The city shall elect the
alternate participation plan, pursuant to KRS 78.530(3), for firefighters who transfer
to the County Employees Retirement System. Notwithstanding the provisions of
KRS 78.530(3)(b), the city may, at its option, extend the payment period for the cost
of alternate participation to a maximum of twenty (20) years with the interest at the
rate actuarially assumed by the board. The city shall have the right to use assets in
the local firefighters' pension fund, other than assets necessary to pay benefits to the
remaining active members of the local firefighters' pension system and to retirees
and their survivors as determined by actuarial evaluation, to assist in the payment of
the annual installment cost of alternate participation. After certification by the
County Employees Retirement System of eligibility for hazardous duty coverage,
each firefighter who becomes a member of the County Employees Retirement
System pursuant to this section shall be granted hazardous duty coverage. (9) Notwithstanding the provisions of KRS 61.565, which relate to the contributions required of participating employers, any city of the first class participating in the
County Employees Retirement System hazardous duty pension plan which has in
effect a collective bargaining agreement with a group of employees who participate
in said plan, shall have the right to enter into agreement with its employees or with
their respective collective bargaining representatives. This agreement may include,
but is not limited to, specifications of what portion of the required employer
contribution shall be borne by the participating employer and what portion shall be
borne by the participating employee. This provision in no way modifies the employer's obligation to remit the contributions required by the County Employees
Retirement System pursuant to KRS 61.565, whether such contributions are borne
by the city or by its participating employees. (10) With regard to the employer participation or employer contributions pursuant to KRS 61.565 as it relates to future pension contribution requirements or as it relates
to payback period or interest charge for service liability cost under alternate
participation, if any statute or any resolution of the appropriate state board of
trustees having authority over employer participation or employer contribution
grants any terms or conditions to any city of the second through the sixth class, or to
any county, or to any urban-county government, which are more favorable in terms
of participation than terms or conditions granted to any city of the first class, then
said provisions for employer participation or contribution shall be available to the
city of the first class, at its option and effective upon adoption by the city of the first
class and notification to the County Employees Retirement System. Effective: July 15, 1998
History: Amended 1998 Ky. Acts ch. 235, sec. 1, effective July 15, 1998; Amended 1988 Ky. Acts ch. 390, sec. 1, effective July 1, 1988. -- Amended 1986 Ky. Acts
ch. 323, sec. 1, effective April 4, 1986. -- Amended 1980 Ky. Acts ch. 387, sec. 1,
effective July 15, 1980. -- Amended 1978 Ky. Acts ch. 164, sec. 19, effective June
17, 1978. -- Amended 1966 Ky. Acts ch. 255, sec. 101. -- Amended 1954 Ky. Acts
ch. 164, sec. 3. -- Amended 1952 Ky. Acts ch. 56, sec. 17. -- Recodified 1942 Ky.
Acts ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. sec. 2872b-1.