Session of 2000
SENATE BILL No. 655
By Committee on Ways and Means
3-7
10 AN ACT
concerning retirement; relating to the Kansas public employees
11 retirement system and
systems thereunder; application of certain
12 amounts recovered by
the system; amending K.S.A. 1999 Supp. 74-
13 4920 and repealing the
existing section.
14
15 Be it enacted by the Legislature of the
State of Kansas:
16 Section
1. K.S.A. 1999 Supp. 74-4920 is hereby amended to read as
17 follows: 74-4920. (1) (a) Upon the basis of
each annual actuarial valuation
18 and appraisal as provided for in subsection
(3)(a) of K.S.A. 74-4908 and
19 amendments thereto, the board shall
certify, on or before July 15 of each
20 year, to the division of the budget in the
case of the state and to the agent
21 for each other participating employer an
actuarially determined estimate
22 of the rate of contribution which will be
required, together with all ac-
23 cumulated contributions and other assets of
the system, to be paid by
24 each such participating employer to pay all
liabilities which shall exist or
25 accrue under the system, including
amortization of the actuarial accrued
26 liability over a period of 40 years
commencing on July 1, 1993, and the
27 actuarial accrued liability for members of
the faculty and other persons
28 who are employed by the state board of
regents or by educational insti-
29 tutions under its management assisted by
the state board of regents in
30 the purchase of retirement annuities as
provided in K.S.A. 74-4925 and
31 amendments thereto, as provided in this
section. The actuarial accrued
32 liability for all participating employers
other than the state board of re-
33 gents relating to members of the faculty
and other persons described in
34 this section, shall be amortized by annual
payments that increase 4% for
35 each year remaining in the amortization
period. For all participating em-
36 ployers other than the state board of
regents relating to members of the
37 faculty and other persons described in this
section, the projected unit
38 credit actuarial cost method shall be used
in annual actuarial valuations,
39 commencing with the 1993 valuation, to
determine the employer contri-
40 bution rates that shall be certified by the
board. The actuarial accrued
41 liability for members of the faculty and
other persons described in this
42 subsection assisted by the state board of
regents in the purchase of re-
43 tirement annuities as provided in K.S.A.
74-4925 and amendments
2
1 thereto shall be amortized by annual
level payments over a period of 11
2 years commencing July 1, 1993. Such
certified rate of contribution shall
3 be based on the standards set forth
in subsection (3)(a) of K.S.A. 74-4908
4 and amendments thereto and shall not
be based on any other purpose
5 outside of the needs of the
system.
6 (b)
(i) For employers affiliating on and after January 1, 1999,
upon
7 the basis of an annual actuarial
valuation and appraisal of the system
8 conducted in the manner provided for
in K.S.A. 74-4908 and amend-
9 ments thereto, the board shall
certify, on or before July 15 of each year
10 to each such employer an actuarially
determined estimate of the rate of
11 contribution which shall be required to be
paid by each such employer
12 to pay all of the liabilities which shall
accrue under the system from and
13 after the entry date as determined by the
board, upon recommendation
14 of the actuary. Such rate shall be termed
the employer's participating
15 service contribution and shall be uniform
for all participating employers.
16 Such additional liability shall be
amortized over a period of 34 years com-
17 mencing on July 1, 1999, by annual payments
that increase 4% for each
18 year remaining in the amortization period.
For all participating employers
19 described in this section, the projected
unit credit actuarial cost method
20 shall be used in annual actuarial
valuations to determine the employer
21 contribution rates that shall be certified
by the board.
22 (ii) The board
shall determine for each such employer separately an
23 amount sufficient to amortize over a period
of not to exceed 34 years
24 commencing July 1, l999, all liabilities
for prior service costs which shall
25 have accrued at the time of entry into the
system. On the basis of such
26 determination the board shall annually
certify to each such employer sep-
27 arately an actuarially determined estimate
of the rate of contribution
28 which shall be required to be paid by that
employer to pay all of the
29 liabilities for such prior service costs.
Such rate shall be termed the em-
30 ployer's prior service contribution.
31 (2) The division
of the budget and the governor shall include in the
32 budget and in the budget request for
appropriations for personal services
33 the sum required to satisfy the state's
obligation under this act as certified
34 by the board and shall present the same to
the legislature for allowance
35 and appropriation.
36 (3) Each other
participating employer shall appropriate and pay to
37 the system a sum sufficient to satisfy the
obligation under this act as
38 certified by the board.
39 (4) Each
participating employer is hereby authorized to pay the em-
40 ployer's contribution from the same fund
that the compensation for which
41 such contribution is made is paid from or
from any other funds available
42 to it for such purpose. Each political
subdivision, other than an instru-
43 mentality of the state, which is by law
authorized to levy taxes for other
3
1 purposes, may levy annually at the
time of its levy of taxes, a tax which
2 may be in addition to all other taxes
authorized by law for the purpose of
3 making its contributions under this
act and, in the case of cities and coun-
4 ties, to pay a portion of the
principal and interest on bonds issued under
5 the authority of K.S.A. 12-1774 and
amendments thereto by cities located
6 in the county, which tax, together
with any other fund available, shall be
7 sufficient to enable it to make such
contribution. In lieu of levying the
8 tax authorized in this subsection,
any taxing subdivision may pay such
9 costs from any employee benefits
contribution fund established pursuant
10 to K.S.A. 12-16,102 and amendments thereto.
Each participating em-
11 ployer which is not by law authorized to
levy taxes as described above,
12 but which prepares a budget for its
expenses for the ensuing year and
13 presents the same to a governing body which
is authorized by law to levy
14 taxes as described above, may include in
its budget an amount sufficient
15 to make its contributions under this act
which may be in addition to all
16 other taxes authorized by law. Such
governing body to which the budget
17 is submitted for approval, may levy a tax
sufficient to allow the partici-
18 pating employer to make its contributions
under this act, which tax, to-
19 gether with any other fund available, shall
be sufficient to enable the
20 participating employer to make the
contributions required by this act.
21 (5) The rate of
contribution certified to a participating employer as
22 provided in this section shall apply during
the fiscal year of the partici-
23 pating employer which begins in the second
calendar year following the
24 year of the actuarial valuation. For the
fiscal year commencing in calendar
25 year 1993, the employer rate of
contribution for the state of Kansas and
26 for participating employers under K.S.A.
74-4931 and amendments
27 thereto shall be 3.1% of the amount of
compensation upon which mem-
28 bers contribute during the period. For the
fiscal year commencing in
29 calendar year 1994, the employer rate of
contribution for the state of
30 Kansas and for participating employers
under K.S.A. 74-4931 and amend-
31 ments thereto shall be 3.2% of the amount
of compensation upon which
32 members contribute during the period. For
the fiscal year commencing
33 in calendar year 1994, the employer rate of
contribution for participating
34 employers other than the state of Kansas
shall be 2.2% of the amount of
35 compensation upon which members contribute
during the period. Except
36 as specifically provided in this section,
for the fiscal year commencing in
37 calendar year 1995, the rate of
contribution certified to a participating
38 employer shall in no event exceed such
participating employer's contri-
39 bution rate for the immediately preceding
fiscal year by more than 0.1%
40 of the amount of compensation upon which
members contribute during
41 the period. Except as specifically provided
in this section, for fiscal years
42 commencing in calendar year 1996 and in
each subsequent calendar year,
43 the rate of contribution certified to the
state of Kansas shall in no event
4
1 exceed the state's contribution rate
for the immediately preceding fiscal
2 year by more than 0.2% of the amount
of compensation upon which
3 members contribute during the period.
Except as specifically provided in
4 this section, for fiscal years
commencing in calendar year 1997 and in
5 each subsequent calendar year, the
rate of contribution certified to par-
6 ticipating employers other than the
state of Kansas shall in no event ex-
7 ceed such participating employer's
contribution rate for the immediately
8 preceding fiscal year by more than
0.15% of the amount of compensation
9 upon which members contribute during
the period. There shall be an
10 employer rate of contribution certified to
the state of Kansas and partic-
11 ipating employers under K.S.A. 74-4931 and
amendments thereto. There
12 shall be a separate employer rate of
contribution certified to all other
13 participating employers other than the
state of Kansas.
14 (6) The actuarial
cost of any legislation enacted in the 1994 session
15 of the Kansas legislature will be included
in the June 30, 1994, actuarial
16 valuation in determining contribution rates
for participating employers.
17 (7) The actuarial
cost of the provisions of K.S.A. 1999 Supp. 74-4950i,
18 and amendments thereto will be
included in the June 30, 1998, actuarial
19 valuation in determining contribution rates
for participating employers.
20 The actuarial accrued liability incurred
for the provisions of K.S.A. 1999
21 Supp. 74-4950i, and amendments
thereto shall be amortized over 15 years.
22 Any net proceeds recovered either by
settlement or otherwise successful
23 litigation by the system on and after
January 1, 2000, pursuant to actions
24 brought to recover damages incurred by
the system related to investments
25 made by the system shall be used to
finance the amount required to fund
26 the actuarial accrued liability of the
state obligation for the postretirement
27 benefit increase provided by K.S.A.
74-4950i, and amendments thereto.
28 (8) The board
with the advice of the actuary may fix the contribution
29 rates for participating employers joining
the system after one year from
30 the first entry date or for employers who
exercise the option contained
31 in K.S.A. 74-4912 and amendments thereto at
rates different from the
32 rate fixed for employers joining within one
year of the first entry date.
33 (9) For employers
affiliating on and after January 1, 1999, the rates
34 of contribution certified to the
participating employer as provided in this
35 section shall apply during the fiscal year
immediately following such cer-
36 tification, but the rate of contribution
during the first year following the
37 employer's entry date shall be equal to 7%
of the amount of compensation
38 on which members contribute during the
year. Any amount of such first
39 year's contribution which may be in excess
of the necessary current serv-
40 ice contribution shall be credited by the
board to the respective em-
41 ployer's prior service liability.
42 (10) Employer
contributions shall in no way be limited by any other
43 act which now or in the future establishes
or limits the compensation of
5
1 any member.
2
(11) Notwithstanding any provision of law to the contrary,
each par-
3 ticipating employer shall remit
quarterly, or as the board may otherwise
4 provide, all employee deductions and
required employer contributions to
5 the executive secretary for credit to
the Kansas public employees retire-
6 ment fund within three days after the
end of the period covered by the
7 remittance by electronic funds
transfer. Remittances of such deductions
8 and contributions received after such
date are delinquent. Delinquent
9 payments due under this subsection
shall be subject to interest at the rate
10 established for interest on judgments under
subsection (a) of K.S.A. 16-
11 204 and amendments thereto. At the request
of the board, delinquent
12 payments which are due or interest owed on
such payments, or both, may
13 be deducted from any other moneys payable
to such employer by any
14 department or agency of the
state.
15 Sec. 2. K.S.A. 1999 Supp.
74-4920 is hereby repealed.
16 Sec. 3. This act shall
take effect and be in force from and after its
17 publication in the Kansas register.