CHAPTER 3 HOUSE BILL No. 2622 An  Act concerning retirement; relating to local police and fire pension plans; contribution rates; amending K.S.A. 12-5002 and repealing the existing section.       Be it enacted by the Legislature of the State of Kansas:

      Section  1. K.S.A. 12-5002 is hereby amended to read as follows: 12-
5002. (a) From and after January 1, 1978, no city may maintain or fund
any local police or fire pension plan except in accordance with the min-
imum funding standards prescribed in this section.

      (b) From and after January 1, 1978, and notwithstanding any other
provision of law to the contrary, all cities maintaining and funding any
local police or fire pension plan shall make annual contributions to each
local police or fire pension plan at an annual rate of contribution which
is equal to or greater than the minimum annual rate of contribution which
is determined pursuant to subsections (c) or (d), except as otherwise spe-
cifically authorized pursuant to subsection (g). Such minimum annual rate
of contribution shall be equal to the sum of: (1) The actuarially deter-
mined amount required to amortize over a period of not more than 40
20 years from January 1, 1978, the accrued unfunded liabilities of such
plan which are attributable to active members; and (2) the amount re-
quired to amortize over a period of not more than 20 years from January
1, 1978, the accrued unfunded liabilities of such plan which are attrib-
utable to retired members; and (3) the normal or ongoing costs attrib-
utable to active members. In each year until the local police or fire pen-
sion plan is funded on an actuarial reserve basis as required by this section
and has no accrued unfunded liability attributable to active members or
retired members, the total of such annual contributions shall not be less
than the total amount of pension benefits paid in such year.

      (c) All cities which will maintain and fund one or more local police
or fire pension plans on and after January 1, 1978, and which do not elect
pursuant to subsection (d) to use the services of an actuary or firm of
actuaries other than the actuary of the board of trustees, shall furnish to
the board of trustees all necessary data, as determined by the board of
trustees, at times designated by the board of trustees, but not more often
than annually, from which the minimum annual rate of contribution for
each such plan may be determined. Upon the basis of an actuarial analysis
of such data, the board of trustees shall certify, commencing on or before
June 1, 1977, and at least once every three years thereafter, to each such
city the actuarially determined minimum annual rate of contribution
which will be required for each such plan in accordance with subsection
(b) for the ensuing calendar year. All costs involved in making certifica-
tions under this subsection shall be paid by each such city.

      (d) Any city which will maintain and fund one or more local police
or fire pension plans on and after January 1, 1978, may elect to use and
pay for the services of an actuary or firm of actuaries other than the
actuary of the board of trustees as provided in subsection (c), in order to
determine the minimum annual rate of contribution for such city for all
such plans. Each city so electing shall file a statement of election with the
board of trustees, setting forth the name and address of the actuary or
firm of actuaries selected by such city and requesting approval thereof.
The board of trustees shall approve such actuary or firm of actuaries for
performance of the periodic actuarial evaluation and review of all the local
police or fire pension plans maintained and funded by such city and for
determination of the minimum annual contribution for each such plan in
accordance with this section if the board of trustees finds that such actuary
or firm of actuaries is qualified therefor. The approved actuary or firm of
actuaries shall perform such actuarial evaluation and review and shall
determine the minimum annual contribution for each local police or fire
pension plan in accordance with this section and shall report annually
thereon to the board of trustees in such form and manner as may be
prescribed by rules and regulations of the board of trustees. The approval
of an actuary or firm of actuaries under this subsection (d) shall be ef-
fective until the city requests approval of another actuary or firm of ac-
tuaries or until the city acts to use the services of the actuary of the board
of trustees under subsection (c) by withdrawing the statement of election
filed under this subsection (d).

      (e) In accordance with the provisions of K.S.A. 77-415 et seq. and
amendments thereto, the board of trustees shall adopt rules and regula-
tions which establish actuarial standards and assumptions for the purposes
of actuarial evaluation and review of local police or fire pension plans and
determination of the minimum annual rates of contribution for cities
maintaining and funding such plans. Whenever the amount of any benefit
is to be determined on the basis of actuarial standards and assumptions,
the standards and assumptions shall be specified in a way that precludes
employer discretion.

      (f) Prior to the adoption by a city of any proposed changes in the
benefit provisions of a local police or fire pension plan or in the rate of
employee contributions thereto, the governing body of the city shall ob-
tain an actuarial evaluation of the effect of such changes, including an
estimate of the minimum annual contribution which would be required
under this section if such changes are adopted. Such actuarial evaluation
and determination shall be conducted by the actuary of the board of
trustees or by the actuary or firm of actuaries approved under subsection
(d) and all costs incurred therefor shall be paid by the city.

      (g) The governing body of any city which is required to make annual
contributions at a minimum annual rate to each local police or fire pension
plan maintained and funded by the city in accordance with this section
and which determines that such minimum annual rate of contributions
would place an undue initial hardship on the property taxpayers of such
city, may adopt a resolution to that effect and file a certified copy of such
resolution with the board of trustees prior to January 1, 1978. Any city
which has filed a certified copy of such resolution with the board of trus-
tees prior to January 1, 1978, may make annual contributions in accord-
ance with the following schedule:

      (1) Contributions for the calendar year 1978 shall be at a rate equal
to or greater than the total of: (A) Thirty-three and one-third percent of
the actuarially determined amount required to amortize over a period of
not more than 40 years from January 1, 1978, the accrued unfunded
liabilities of such plan which are attributable to active members; (B)
331/3% of the amount required to amortize over a period of not more than
20 years from January 1, 1978, the accrued unfunded liabilities of such
plan which are attributable to retired members; and (C) the normal or
ongoing costs attributable to active members.

      (2) Contributions for the calendar year 1979 shall be at a rate equal
to or greater than the total of: (A) Sixty-six and two-thirds percent of the
actuarially determined amount required to amortize over a period of not
more than 39 years from January 1, 1979, the accrued unfunded liabilities
of such plan which are attributable to active members; (B) 662/3% of the
amount required to amortize over a period of not more than 19 years
from January 1, 1979, the accrued unfunded liabilities of such plan which
are attributable to retired members; and (C) the normal or ongoing costs
attributable to active members.

      (3) Contributions for the calendar year 1980 and each year thereafter
shall be at a rate equal to or greater than the total of: (A) One hundred
percent of the actuarially determined amount required to amortize over
a period of not more than 38 years from January 1, 1980, the accrued
unfunded liabilities of such plan which are attributable to active members;
(B) 100% of the amount required to amortize over a period of not more
than 18 years from January 1, 1980, the accrued unfunded liabilities of
such plan which are attributable to retired members; and (C) the normal
or ongoing costs attributable to active members.

      (4) In each year until the local police or fire pension plan is funded
on an actuarial reserve basis as required by this section in accordance
with this schedule and has no accrued unfunded liability attributable to
active members or retired members, the total of such annual contribu-
tions shall not be less than the total amount of pension benefits paid in
such year.  
Sec.  2. K.S.A. 12-5002 is hereby repealed.
 Sec.  3. This act shall take effect and be in force from and after its
publication in the statute book.

Approved March 15, 2002.
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