Session of 1998
                   
HOUSE BILL No. 2875
         
By Committee on Appropriations
         
2-11
            9             AN ACT concerning the Kansas public employees retirement system and
10             systems thereunder; relating to a postretirement benefit adjustment;
11             employer contribution rates; amending K.S.A. 1997 Supp. 74-4920 and
12             repealing the existing section.
13            
14       Be it enacted by the Legislature of the State of Kansas:
15           New Section 1. (a) The retirement benefit, pension or annuity pay-
16       ments accruing after June 30, 1998, to each retirant and each local school
17       annuitant shall be increased by an amount equal to 3.0% of the retirement
18       benefit, pension or annuity payment in effect on July 1, 1998, from the
19       retirant's retirement system and shall be paid by such retirement system
20       to the retirant and the local school annuitant during such period.
21           (b) As used in this section:
22           (1) ``Retirant'' means (A) any person who is a member of a retirement
23       system and who retired prior to July 1, 1997, (B) any person who is a
24       special member of a retirement system and who retired prior to July 1,
25       1997, and (C) any person who is a joint annuitant or beneficiary of any
26       member described in clause (A) or any special member described in
27       clause (B).
28           (2) ``Retirement system'' means the Kansas public employees retire-
29       ment system, the Kansas police and firemen's retirement system, the state
30       school retirement system and the retirement system for judges.
31           (3) ``Local school annuitant'' means (A) any person who is an annui-
32       tant with 10 or more years of service, who is receiving an annuity, whose
33       annuity is not included, in whole or in part, in payments made to such
34       school district under K.S.A. 72-5512b and amendments thereto, and who
35       is not a member of a group I or of group II as defined in K.S.A. 72-5518
36       and amendments thereto, and (B) any person who is receiving an annuity
37       and who retired prior to September 1, 1981.
38           Sec. 2. K.S.A. 1997 Supp. 74-4920 is hereby amended to read as
39       follows: 74-4920. (1) Upon the basis of each annual actuarial valuation
40       and appraisal as provided for in subsection (3)(a) of K.S.A. 74-4908 and
41       amendments thereto, the board shall certify, on or before July 15 of each
42       year, to the division of the budget in the case of the state and to the agent
43       for each other participating employer an actuarially determined estimate

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  1       of the rate of contribution which will be required, together with all ac-
  2       cumulated contributions and other assets of the system, to be paid by
  3       each such participating employer to pay all liabilities which shall exist or
  4       accrue under the system, including amortization of the actuarial accrued
  5       liability over a period of 40 years commencing on July 1, 1993, and the
  6       actuarial accrued liability for members of the faculty and other persons
  7       who are employed by the state board of regents or by educational insti-
  8       tutions under its management assisted by the state board of regents in
  9       the purchase of retirement annuities as provided in K.S.A. 74-4925 and
10       amendments thereto, as provided in this section. The actuarial accrued
11       liability for all participating employers other than the state board of re-
12       gents relating to members of the faculty and other persons described in
13       this section, shall be amortized by annual payments that increase 4% for
14       each year remaining in the amortization period. For all participating em-
15       ployers other than the state board of regents relating to members of the
16       faculty and other persons described in this section, the projected unit
17       credit actuarial cost method shall be used in annual actuarial valuations,
18       commencing with the 1993 valuation, to determine the employer contri-
19       bution rates that shall be certified by the board. The actuarial accrued
20       liability for members of the faculty and other persons described in this
21       subsection assisted by the state board of regents in the purchase of re-
22       tirement annuities as provided in K.S.A. 74-4925 and amendments
23       thereto shall be amortized by annual level payments over a period of 10
24       years commencing July 1, 1993. Such certified rate of contribution shall
25       be based on the standards set forth in subsection (3)(a) of K.S.A. 74-4908
26       and amendments thereto and shall not be based on any other purpose
27       outside of the needs of the system.
28           (2) The division of the budget and the governor shall include in the
29       budget and in the budget request for appropriations for personal services
30       the sum required to satisfy the state's obligation under this act as certified
31       by the board and shall present the same to the legislature for allowance
32       and appropriation.
33           (3) Each other participating employer shall appropriate and pay to
34       the system a sum sufficient to satisfy the obligation under this act as
35       certified by the board.
36           (4) Each participating employer is hereby authorized to pay the em-
37       ployer's contribution from the same fund that the compensation for which
38       such contribution is made is paid from or from any other funds available
39       to it for such purpose. Each political subdivision, other than an instru-
40       mentality of the state, which is by law authorized to levy taxes for other
41       purposes, may levy annually at the time of its levy of taxes, a tax which
42       may be in addition to all other taxes authorized by law for the purpose of
43       making its contributions under this act and, in the case of cities and coun-

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  1       ties, to pay a portion of the principal and interest on bonds issued under
  2       the authority of K.S.A. 12-1774 and amendments thereto by cities located
  3       in the county, which tax, together with any other fund available, shall be
  4       sufficient to enable it to make such contribution. In lieu of levying the
  5       tax authorized in this subsection, any taxing subdivision may pay such
  6       costs from any employee benefits contribution fund established pursuant
  7       to K.S.A. 12-16,102 and amendments thereto. Each participating em-
  8       ployer which is not by law authorized to levy taxes as described above,
  9       but which prepares a budget for its expenses for the ensuing year and
10       presents the same to a governing body which is authorized by law to levy
11       taxes as described above, may include in its budget an amount sufficient
12       to make its contributions under this act which may be in addition to all
13       other taxes authorized by law. Such governing body to which the budget
14       is submitted for approval, may levy a tax sufficient to allow the partici-
15       pating employer to make its contributions under this act, which tax, to-
16       gether with any other fund available, shall be sufficient to enable the
17       participating employer to make the contributions required by this act.
18           (5) The rate of contribution certified to a participating employer as
19       provided in this section shall apply during the fiscal year of the partici-
20       pating employer which begins in the second calendar year following the
21       year of the actuarial valuation. For the fiscal year commencing in calendar
22       year 1993, the employer rate of contribution for the state of Kansas and
23       for participating employers under K.S.A. 74-4931 and amendments
24       thereto shall be 3.1% of the amount of compensation upon which mem-
25       bers contribute during the period. For the fiscal year commencing in
26       calendar year 1994, the employer rate of contribution for the state of
27       Kansas and for participating employers under K.S.A. 74-4931 and amend-
28       ments thereto shall be 3.2% of the amount of compensation upon which
29       members contribute during the period. For the fiscal year commencing
30       in calendar year 1994, the employer rate of contribution for participating
31       employers other than the state of Kansas shall be 2.2% of the amount of
32       compensation upon which members contribute during the period. Except
33       as specifically provided in this section, for the fiscal year commencing in
34       calendar year 1995, the rate of contribution certified to a participating
35       employer shall in no event exceed such participating employer's contri-
36       bution rate for the immediately preceding fiscal year by more than 0.1%
37       of the amount of compensation upon which members contribute during
38       the period. Except as specifically provided in this section, for fiscal years
39       commencing in calendar year 1996 and in each subsequent calendar year,
40       the rate of contribution certified to the state of Kansas shall in no event
41       exceed the state's contribution rate for the immediately preceding fiscal
42       year by more than 0.2% of the amount of compensation upon which
43       members contribute during the period. Except as specifically provided in

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  1       this section, for fiscal years commencing in calendar year 1997 and in
  2       each subsequent calendar year, the rate of contribution certified to par-
  3       ticipating employers other than the state of Kansas shall in no event ex-
  4       ceed such participating employer's contribution rate for the immediately
  5       preceding fiscal year by more than 0.15% of the amount of compensation
  6       upon which members contribute during the period. There shall be an
  7       employer rate of contribution certified to the state of Kansas and partic-
  8       ipating employers under K.S.A. 74-4931 and amendments thereto. There
  9       shall be a separate employer rate of contribution certified to all other
10       participating employers other than the state of Kansas.
11           (6) The actuarial cost of any legislation enacted in the 1994 session
12       of the Kansas legislature will be included in the June 30, 1994, actuarial
13       valuation in determining contribution rates for participating employers.
14           (7) The actuarial cost of the provisions of section 1 will be included
15       in the June 30, 1998, actuarial valuation in determining contribution rates
16       for participating employers.
17           (8) The board with the advice of the actuary may fix the contribution
18       rates for participating employers joining the system after one year from
19       the first entry date or for employers who exercise the option contained
20       in K.S.A. 74-4912 and amendments thereto at rates different from the
21       rate fixed for employers joining within one year of the first entry date.
22             (8) (9) Employer contributions shall in no way be limited by any other
23       act which now or in the future establishes or limits the compensation of
24       any member.
25             (9) (10) Each participating employer shall remit quarterly, or as the
26       board may otherwise provide, all employee deductions and required em-
27       ployer contributions to the executive secretary for credit to the Kansas
28       public employees retirement fund within 20 days after the end of the
29       period covered by the remittance or within 25 days after forms or written
30       instructions from the system were mailed by the system to such employer,
31       whichever is later. Remittances of such deductions and contributions re-
32       ceived after such date are delinquent. Delinquent payments due under
33       this subsection shall be subject to interest at the rate established for in-
34       terest on judgments under subsection (a) of K.S.A. 16-204 and amend-
35       ments thereto. At the request of the board, delinquent payments which
36       are due or interest owed on such payments, or both, may be deducted
37       from any other moneys payable to such employer by any department or
38       agency of the state.
39           Sec. 3. K.S.A. 1997 Supp. 74-4920 is hereby repealed.
40           Sec. 4. This act shall take effect and be in force from and after its
41       publication in the statute book.
42      
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