Session of 2000
HOUSE BILL No. 2665
By Kansas 2000 Select Committee
1-20
9 AN ACT concerning retirement; relating to a pension equity option for
10 members of the Kansas public employees retirement system; amend-
11 ing K.S.A. 1999 Supp. 74-4918 and repealing the existing section.
12
13 Be it enacted by the Legislature of the State of Kansas:
14 Section 1. K.S.A. 1999 Supp. 74-4918 is hereby amended to read as
15 follows: 74-4918. (1) A member may elect to have such member's retire-
16 ment benefit paid under one of the options provided in this section in
17 lieu of having it paid in the form stated in K.S.A. 74-4915 or section 2
18 and amendments thereto. Such election must be made before the date
19 of actual retirement. A specific person must be designated as joint an-
20 nuitant at the time of election of the joint and 1/2 to joint annuitant survivor
21 option, the joint and survivor option and the joint and 3/4 to joint annuitant
22 survivor option. Under no circumstances may an option be changed or
23 canceled nor the named joint annuitant changed after the date of actual
24 retirement of the member.
25 (2) The amount of retirement benefit payable under an option shall
26 be based on the age of the member and, if applicable, the age of the joint
27 annuitant, and shall be such amount as to be the actuarial equivalent of
28 the retirement benefit otherwise payable under K.S.A. 74-4915 and
29 amendments thereto, as prescribed in subsection (3). In no case shall the
30 total amount of retirement benefit paid under any option provided in this
31 section be more than 100% of the retirement benefit which would have
32 been otherwise payable if no option had been elected under this section.
33 (3) The following retirement options, which are subject to the pro-
34 visions of K.S.A. 1999 Supp. 74-49,123 and amendments thereto, are
35 available:
36 (A) Joint and 1/2 to joint annuitant survivor. A reduced retirement
37 benefit is payable to the retirant during the retirant's lifetime in a monthly
38 amount equal to the product of (A) the monthly payment of the retire-
39 ment benefit otherwise payable under K.S.A. 74-4915 and amendments
40 thereto and (B) the percentage equal to 91% minus .4% for each year by
41 which the age of the retirant's joint annuitant is less than the retirant's
42 age, computed to the nearest whole year, or plus .4% for each year by
43 which the age of the retirant's joint annuitant is more than the retirant's
2
1 age, computed to the nearest whole year, with 1/2 of that monthly amount
2 continued to the retirant's joint annuitant during such joint annuitant's
3 remaining lifetime, if any, after the death of the retirant. In the event that
4 the designated joint annuitant under this option predeceases the retirant,
5 the amount of the retirement benefit otherwise payable to the retirant
6 under this option shall be adjusted automatically to the retirement benefit
7 which the retirant would have received if no option had been elected
8 under this section.
9 (B) Joint and survivor. A reduced retirement benefit is payable to
10 the retirant during the retirant's lifetime in a monthly amount equal to
11 the product of (A) the monthly payment of the retirement benefit oth-
12 erwise payable under K.S.A. 74-4915 and amendments thereto and (B)
13 the percentage equal to 83% minus .6% for each year by which the age
14 of the retirant's joint annuitant is less than the retirant's age, computed
15 to the nearest whole year, or plus .6% for each year by which the age of
16 the retirant's joint annuitant is more than the retirant's age, computed to
17 the nearest whole year, with that amount continued to the joint annuitant
18 during the joint annuitant's remaining lifetime, if any, after the death of
19 the retirant. In the event that the designated joint annuitant under this
20 option predeceases the retirant, the amount of the retirement benefit
21 otherwise payable to the retirant under this option shall be adjusted au-
22 tomatically to the retirement benefit which the retirant would have re-
23 ceived if no option had been elected under this section.
24 (C) Joint and 3/4 to joint annuitant survivor. A reduced retirement
25 benefit is payable to the retirant during the retirant's lifetime in a monthly
26 amount equal to the product of (A) the monthly payment of the retire-
27 ment benefit otherwise payable under K.S.A. 74-4915 and amendments
28 thereto and (B) the percentage equal to 87% minus .5% for each year by
29 which the age of the retirant's joint annuitant is less than the retirant's
30 age, computed to the nearest whole year, or plus .5% for each year by
31 which the age of the retirant's joint annuitant is more than the retirant's
32 age, computed to the nearest whole year, with 3/4 of that monthly amount
33 continued to the retirant's joint annuitant during such joint annuitant's
34 remaining lifetime, if any, after the death of the retirant. In the event that
35 the designated joint annuitant under this option predeceases the retirant,
36 the amount of the retirement benefit otherwise payable to the retirant
37 under this option shall be adjusted automatically to the retirement benefit
38 which the retirant would have received if no option had been elected
39 under this section.
40 (D) Life with 5 years certain. A reduced retirement benefit is payable
41 to the retirant during the retirant's lifetime in a monthly amount equal
42 to 98% of the monthly payment of the retirement benefit otherwise pay-
43 able under K.S.A. 74-4915 and amendments thereto and if the retirant
3
1 dies within the five-year certain period, measured from the commence-
2 ment of retirement benefit payments, such payments shall be continued
3 to the retirant's beneficiary during the balance of the five-year certain
4 period.
5 (E) Life with 10 years certain. A reduced retirement benefit is pay-
6 able to the retirant during the retirant's lifetime in a monthly amount
7 equal to 95% of the monthly payment of the retirement benefit otherwise
8 payable under K.S.A. 74-4915 and amendments thereto and if the retirant
9 dies within the ten-year certain period, measured from the commence-
10 ment of retirement benefit payments, such payments shall be continued
11 to the retirant's beneficiary during the balance of the ten-year certain
12 period.
13 (F) Life with 15 years certain. A reduced retirement benefit is pay-
14 able to the retirant during the retirant's lifetime in a monthly amount
15 equal to 88% of the monthly payment of the retirement benefit otherwise
16 payable under K.S.A. 74-4915 and amendments thereto and if the retirant
17 dies within the fifteen-year certain period, measured from the com-
18 mencement of retirement benefit payments, such payments shall be con-
19 tinued to the retirant's beneficiary during the balance of the fifteen-year
20 certain period.
21 (4) If a member, who is eligible to retire in accordance with the pro-
22 visions of K.S.A. 74-4914 and amendments thereto, dies without having
23 actually retired, the member's spouse, if the spouse is the sole beneficiary
24 for the member's accumulated contributions, may elect to receive ben-
25 efits under one of the options provided in this section in lieu of receiving
26 the member's accumulated contributions.
27 (5) The benefits of subsection (4) shall be available in the case of
28 death within the first six months after the entry date of the member's
29 participating employer.
30 (6) On and after January 1, 1991, if a member with 15 or more years
31 of credited service dies before attaining retirement age, the member's
32 spouse, if the spouse is the sole beneficiary for the member's accumulated
33 contributions, may elect to receive benefits under one of the options
34 provided in this section in lieu of receiving the member's accumulated
35 contributions. Payments under one of the options provided in this section
36 to the member's spouse if so elected, shall commence on the date that
37 the member would have attained retirement age.
38 (7) Benefits payable to a joint annuitant shall accrue from the first
39 day of the month following the death of a member or retirant and, in the
40 case of the joint and 1/2 to joint annuitant survivor option, the joint and
41 survivor option and the joint and 3/4 to joint annuitant survivor option,
42 shall end on the last day of the month in which the joint annuitant dies.
43 (8) The provisions of the law in effect on the retirement date of a
4
1 member under the system shall govern the retirement benefit payable to
2 the retirant and any joint annuitant, except, for retirement benefits pay-
3 able after July 1, 1993, for retirants who retired prior to July 1, 1982, in
4 the event that the designated joint annuitant under the option provided
5 in subsection (3)(A), (B) or (C), as applicable, predeceased the retirant,
6 the amount of the retirement benefit otherwise payable to the retirant
7 under the option provided in subsection (3)(A), (B) or (C), as applicable,
8 shall be adjusted automatically to the retirement benefit which the retir-
9 ant would have received if no option had been elected under this section.
10 (9) Upon the death of a joint annuitant who is receiving a retirement
11 benefit under the provisions of this section, there shall be paid to such
12 joint annuitant's beneficiary an amount equal to the excess, if any, of the
13 accumulated contributions of the retirant over the sum of all retirement
14 benefit payments made to such retirant and such joint annuitant. Such
15 joint annuitant shall designate a beneficiary by filing in the office of the
16 retirement system such designation at the time of death of the retirant.
17 If there is no named beneficiary of such joint annuitant living at the time
18 of death of such joint annuitant, any amount provided for by this section
19 shall be paid to, in order of preference as follows:
20 (A) The joint annuitant's surviving spouse;
21 (B) the joint annuitant's dependent child or children;
22 (C) the joint annuitant's dependent parent or parents;
23 (D) the joint annuitant's nondependent child or children;
24 (E) the joint annuitant's nondependent parent or parents; or
25 (F) the estate of the deceased joint annuitant.
26 New Sec. 2. (a) A member of the Kansas public employees retire-
27 ment system may elect to have such member's retirement benefit, as
28 defined in K.S.A. 74-4902 and amendments thereto, paid under the pro-
29 visions of this section in lieu of having such benefit paid in the form stated
30 in K.S.A. 74-4915 or 74-4918 and amendments thereto. Such election
31 shall be made before the date of actual retirement. Such election shall
32 be irrevocable after the date of actual retirement.
33 (b) If a member elects to have a retirement benefit paid as provided
34 in subsection (a), each such member shall be entitled to a retirement
35 benefit account determined as provided in this section. A retirement ben-
36 efit paid under the provisions of this section shall be based on the product
37 of the sum of accrual rates credited each year as determined pursuant to
38 this subsection for such member multiplied by such member's final av-
39 erage salary as provided in K.S.A. 74-4902 and amendments thereto. Each
40 member shall be credited with an accrual rate based on an accumulated
41 percentage of final average salary for each year of service as follows:
42 (1) For each year of service of the member under 30 years of age, an
43 amount equal to 4%;
5
1 (2) for each year of service of the member from 30 to 39 years of
2 age, an amount equal to 6%;
3 (3) for each year of service of the member from 40 to 49 years of
4 age, an amount equal to 8%;
5 (4) for each year of service of the member from 50 to 59 years of
6 age, an amount equal to 10%; and
7 (5) for each year of service of the member from 60 years of age and
8 over, an amount equal to 12%.
9 (c) Each member may elect to have such member's retirement ben-
10 efit account as determined in subsection (b) to be paid out to such mem-
11 ber in a lump sum or in equal monthly installments in an amount deter-
12 mined by the actuary using the actuarial assumptions and tables then
13 currently in use by the retirement system.
14 (d) No member who elects to have such member's retirement benefit
15 paid under the provisions of this section shall be eligible for any postre-
16 tirement benefit increase or cost of living adjustment or similar benefit
17 increase as provided by law.
18 (e) The provisions of this section shall not apply to members of the
19 Kansas police and firemen's retirement system and the retirement system
20 for judges.
21 (f) The provisions of this section shall be part of and supplemental to
22 the provisions of K.S.A. 74-4901 et seq. and amendments thereto.
23 Sec. 3. K.S.A. 1999 Supp. 74-4918 is hereby repealed.
24 Sec. 4. This act shall take effect and be in force from and after July
25 1, 2001, and its publication in the statute book.