161.620 Retirement allowances -- Amount -- Applicability to persons becoming members on or after July 1, 2008. - Kentucky Statutes

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161.620 Retirement allowances -- Amount -- Applicability to persons becoming members on or after July 1, 2008. (1) The retirement allowance, in the form of a life annuity with refundable balance, of a member retiring for service shall be calculated as follows:
(a) For retirements effective July 1, 1998, and thereafter, except as otherwise provided by this section, the annual allowance for each year of service shall be
two percent (2%) of the final average salary for service performed prior to
July 1, 1983, and two and one-half percent (2.5%) of the final average salary
for service performed after July 1, 1983, for all members not employed by a
state college or university. The annual retirement allowance for each year of
service performed by members of the Teachers' Retirement System who are
members under the provisions of KRS 161.220(4)(b) or (n) shall be two
percent (2%) of the final average salary. Actuarial discounts due to age or
service credit at retirement may be applied as provided in this section; (b) For individuals who become members of the Kentucky Teachers' Retirement System on or after July 1, 2002, and before July 1, 2008, except those persons
who become members under KRS 161.220(4)(b) or (n), and who upon
retirement have earned less than ten (10) full years of service credit, the
retirement allowance shall be two percent (2%) of the member's final average
salary for each year of service. For individuals who become members of the
Kentucky Teachers' Retirement System on or after July 1, 2002, and before
July 1, 2008, except those persons who become members under KRS
161.220(4)(b) or (n), and who upon retirement have earned at least ten (10)
full years of service credit, the annual allowance for each year of service shall
be two and one-half percent (2.5%) of the member's final average salary; (c) The board of trustees may approve for members who initially retire on or after July 1, 2004, and who become members before July 1, 2008, except those
persons who are members under KRS 161.220(4)(b) or (n), a retirement
allowance of three percent (3%) of the member's final average salary for each
year of service credit earned in excess of thirty (30) years. This three percent
(3%) factor shall be in lieu of the two and one-half percent (2.5%) factor
provided for in paragraph (b) of this subsection for every year or fraction of a
year of service in excess of thirty (30) years. Upon approval of this three
percent (3%) retirement factor, the board of trustees may establish conditions
of eligibility regarding the type of service credit that will qualify for meeting
the requirements of this subsection. This subsection is optional with the board
of trustees and shall not be subject to KRS 161.714; (d) For individuals who become members of the Kentucky Teachers' Retirement System on or after July 1, 2008, except those persons who become members
under KRS 161.220(4)(b) or (n), the retirement allowance shall be:
1. a. One and seven-tenths percent (1.7%) of the member's final average
salary for each year of service if the member has earned ten (10) or
less years of service at retirement; b. Two percent (2%) of the member's final average salary for each
year of service if the member has earned greater than ten (10) but
no more than twenty (20) years of service at retirement; c. Two and three-tenths percent (2.3%) of the member's final average
salary for each year of service if the member has earned greater
than twenty (20) but no more than twenty-six (26) years of service
at retirement; or d. Two and one-half percent (2.5%) of the member's final average
salary for each year of service if the member has earned greater
than twenty-six (26) but no more than thirty (30) years of service at
retirement; and 2. Three percent (3%) of the member's final average salary for each year of
service earned in excess of thirty (30) years of service at retirement
subject to the same terms and conditions as set forth in paragraph (c) of
this subsection; (e) For individuals who become members of the Kentucky Teachers' Retirement System on or after July 1, 2008, who are members under KRS 161.220(4)(b)
or (n), the retirement allowance shall be:
1. One and one-half percent (1.5%) of the member's final average salary for
each year of service if the member has earned ten (10) or less years of
service at retirement; 2. One and seven-tenths percent (1.7%) of the member's final average
salary for each year of service if the member has earned greater than ten
(10) but no more than twenty (20) years of service at retirement; 3. One and eighty-five hundredths percent (1.85%) of the member's final
average salary for each year of service if the member has earned greater
than twenty (20) but less than twenty-seven (27) years of service at
retirement; or 4. Two percent (2%) of the member's final average salary for each year of
service if the member has earned twenty-seven (27) or more years of
service at retirement; and (f) The retirement allowance of a member at retirement, as measured on a life annuity, shall not exceed the member's last yearly salary or the member's final
average salary, whichever is the greater amount. For purposes of this section,
"yearly salary" means the compensation earned by a member during the most
recent period of contributing service, either consecutive or nonconsecutive,
preceding the member's effective retirement date and shall be subject to the
provisions of KRS 161.220(9) and (10). (2) Effective July 1, 2002, and annually on July 1 thereafter, the retirement allowance of each retired member and of each beneficiary of a retirement option shall be
increased in the amount of one and one-half percent (1.5%), provided the retired
member had been retired for at least the full twelve (12) months immediately
preceding the date that the increase is effective. In the event that the retired member had been retired for less than the full twelve (12) months immediately preceding the
date that the increase is effective, then the increase shall be reduced on a pro rata
basis by each month that the retired member had not been retired for the full twelve
(12) months immediately preceding the effective date of the increase.
(3) Any member qualifying for retirement under a life annuity with refundable balance shall be entitled to receive an annual allowance amounting to not less
than four hundred dollars ($400) effective July 1, 2002, and not less than four
hundred forty dollars ($440) effective July 1, 2003, multiplied by the service
credit years of the member. These minimums shall apply to the retired
members receiving annuity payments and to those members retiring on or
subsequent to the effective dates listed in this subsection, except the
following:(a) Individuals who become members of the Kentucky Teachers' Retirement System on or after July 1, 2008; or (b) Members whose retirement allowance payment is reduced below the minimum allowance as a result of its division in a qualified domestic relations
order or any other provision permitted under KRS 161.700. (4) The minimum retirement allowance provided in this section shall apply in the case of members retired or retiring under an option other than a life annuity with
refundable balance in the same proportion to the benefits of the member and his
beneficiary or beneficiaries as provided in the duly-adopted option tables at the time
of the member's retirement. (5) Effective July 1, 2008, the monthly allowance of each retired member and each recipient of a retirement option of the retired member may be increased in an
amount not to exceed three and one-half percent (3.5%) of the monthly allowance in
effect the previous month, provided the retired member had been retired for at least
the full twelve (12) months immediately preceding the date that the increase is
effective. In the event that the retired member had been retired for less than the full
twelve (12) months immediately preceding the date that the increase is effective,
then the increase shall be reduced on a pro rata basis by each month that the retired
member had not been retired for the full twelve (12) months immediately preceding
the effective date of the increase. The level of increase provided for in this
subsection shall be determined by the funding provided in the 2008-2010 biennium
budget appropriation. (6) Effective July 1, 2009, the monthly allowance of each retired member and each recipient of a retirement option of the retired member may be increased in an
amount not to exceed seven-tenths of one percent (0.7%) of the monthly allowance
in effect the previous month, provided the retired member had been retired for at
least the full twelve (12) months immediately preceding the date that the increase is
effective. In the event that the retired member had been retired for less than the full
twelve (12) months immediately preceding the date that the increase is effective,
then the increase shall be reduced on a pro rata basis by each month that the retired
member had not been retired for the full twelve (12) months immediately preceding
the effective date of the increase. The level of increase provided for in this subsection shall be determined by the funding provided in the 2008-2010 biennium
budget appropriation. (7) Effective July 1, 1990, monthly payments of two hundred dollars ($200) shall be payable for the benefit of an adult child of a member retired for service when the
child's mental or physical condition is sufficient to cause dependency on the
member at the time of retirement. Eligibility for this payment shall continue for the
life of the child or until the time the mental or physical condition creating the
dependency no longer exists or the child marries. Benefits under this subsection
shall apply to legally adopted survivors provided the proceedings for the adoption
were initiated at least one (1) year prior to the death of the member. The board of
trustees shall be the sole judge of eligibility or dependency and may require formal
application or information relating thereto. (8) Members of the Teachers' Retirement System shall be subject to the annuity income limitations imposed by Section 415 of the Internal Revenue Service Code. (9) Compensation in excess of the limitations imposed by Section 401(a)(17) of the Internal Revenue Code shall not be used in determining a member's retirement
annuity. The limitation on compensation for eligible members shall not be less than
the amount which was allowed to be taken into account by the retirement system in
effect on July 1, 1993. For this purpose, an eligible member is an individual who
was a member of the retirement system before the first plan year beginning after
December 31, 1995. Effective: July 15, 2010
History: Amended 2010 Ky. Acts ch. 148, sec. 10, effective July 15, 2010; and ch. 164, sec. 10, effective July 1, 2010. -- Amended 2008 (1st Extra. Sess.) Ky. Acts ch. 1,
sec. 39, effective June 27, 2008. -- Amended 2008 Ky. Acts ch. 78, sec. 17, effective
July 1, 2008. -- Amended 2006 Ky. Acts ch. 189, sec. 2, effective July 1, 2006. --
Amended 2004 Ky. Acts ch. 121, sec. 19, effective July 1, 2004. -- Amended 2002
Ky. Acts ch. 275, sec. 28, effective July 1, 2002. -- Amended 2000 Ky. Acts ch. 498,
sec. 18, effective July 1, 2000. -- Amended 1998 Ky. Acts ch. 515, sec. 12, effective
July 1, 1998. -- Amended 1996 Ky. Acts ch. 359, sec. 15, effective July 1, 1996. --
Amended 1994 Ky. Acts ch. 369, sec. 18, effective July 1, 1994.