SENATE BILL No. 14

      An Act concerning the department of administration; relating to administration of the
      deferred compensation plan for public officers and employees; amending K.S.A. 75-
      5525 and repealing the existing section.

Be it enacted by the Legislature of the State of Kansas:

    New Section 1. The provisions of K.S.A. 75-5521 through 75-5529a
and sections 1 and 2 and amendments thereto shall be known and may
be cited as the Kansas public employees deferred compensation act.

    New Sec. 2. (a) The secretary of administration shall establish an
administrative oversight committee on deferred compensation. The
members of the administrative oversight committee on deferred com-
pensation shall meet at least once each calendar quarter. The members
of the administrative oversight committee on deferred compensation shall
receive no compensation or expenses for service on the committee.

    (b) The administrative oversight committee on deferred compensa-
tion shall:

    (1) Advise and consult on the implementation and administration of
the provisions of the Kansas public employees deferred compensation act
and the deferred compensation plan;

    (2) evaluate the program operations with respect to customer service
and operations;

    (3) evaluate investment performance as it relates to comparable op-
tions;

    (4) evaluate program operations with respect to federal and state stat-
utes and contractual requirements and as compared to other deferred
compensation programs;

    (5) review the overall administration of each agreement entered into
under K.S.A. 75-5523 and amendments thereto for the deferred com-
pensation plan and the overall performance by the qualified insurer or
other qualified contracting party entering into such agreement;

    (6) review the investment management fees under the deferred com-
pensation plan for reasonableness compared with other deferred com-
pensation programs;

    (7) review audits conducted on the deferred compensation plan and
other reports reviewing program operations thereunder to assure oper-
ations are following all applicable statutes and rules and regulations and
to assure coverage of appropriate deferred compensation plan accounts
of participants under the Kansas life and health insurance guaranty as-
sociations act;

    (8) review overall performance of the contracting party under the
agreement entered into under K.S.A. 75-5523 and amendments thereto
for the deferred compensation plan that is in effect on the effective date
of this act and determine whether or not competition should be initiated
with other qualified insurers and other qualified contracting parties to
enter into such agreements;

    (9) review current procedures for handling complaints about the de-
ferred compensation plan to ensure customer satisfaction and sharing of
complaint information;

    (10) evaluate on a continuing basis the need to provide participants
with information regarding the provisions, requirements and procedures
under the deferred compensation plan; and

    (11) periodically prepare and present reports of the findings and re-
sults of the activities of the committee to the secretary of administration,
the governor and the legislature, as appropriate.

    Sec. 3. K.S.A. 75-5525 is hereby amended to read as follows: 75-
5525. (a) All moneys which are deferred and deducted by the director in
accordance with the provisions of an agreement entered into under K.S.A.
75-5524, and amendments thereto, and the provisions of this act, shall
remain assets of the state, shall be held in accordance with section 457 of
the federal internal revenue code of 1986, and amendments thereto, for
the exclusive benefit of participants and their beneficiaries, and shall be
disposed of in accordance with the terms of the agreement between the
employee and the director. The obligation of the state to the employee
and approved insurers or other contractors shall be a contractual obliga-
tion only and no preferred or special interest in the deferred moneys shall
accrue to such employee or to such approved insurer or other contractor.

    (b) Contributions payable to the deferred compensation plan pur-
suant to the plan shall not be subject to any premium tax or other charges
arising under the insurance laws of this state. If any such tax or charge
has been paid prior to the effective date of this act, the same shall be
refunded.

    Sec. 4. K.S.A. 75-5525 is hereby repealed.

    Sec. 5. This act shall take effect and be in force from and after its
publication in the statute book.

I hereby certifiy that the above Bill originated in the
Senate, and passed that body

__________________________________

Senate concurred in
House amendments__________________________

__________________________________

President of the Senate.

__________________________________

Secretary of the Senate.

Passed the House
as amended __________________________

__________________________________

Speaker of the House.

__________________________________

Cheif Clerk of the House.

Approved __________________________

__________________________________

Governor.