161.540 Members' contributions -- Picked-up contributions.
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<![CDATA[161.540 Members' contributions -- Picked-up contributions. (1) (a) Effective July 1, 1988, each individual who first becomes a member before July 1, 2008, shall contribute to the retirement system nine and eight hundred <br>fifty-five thousandths percent (9.855%) of annual compensation, except that <br>university employees who participate in the Kentucky Teachers' Retirement <br>System shall contribute eight and three hundred seventy-five thousandths <br>percent (8.375%) of annual compensation. (b) Each individual who first becomes a member on or after July 1, 2008, shall contribute to the retirement system ten and eight hundred fifty-five <br>thousandths percent (10.855%) of annual compensation, except that university <br>employees who participate in the Kentucky Teachers' Retirement System shall <br>contribute nine and three hundred seventy-five thousandths percent (9.375%) <br>of annual compensation. (c) 1. Effective July 1, 2010, members shall, in addition to those contributions <br>required under paragraphs (a) and (b) of this subsection, make a <br>contribution to the medical insurance fund established under KRS <br>161.420(5) according to the following schedule: <br>a. For each individual who first became a member of the retirement <br>system before July 1, 2008, a total amount of annual compensation <br>equal to and effective on: July 1, 2010........................Twenty-five hundredths percent (.25%) July 1, 2011..............................................One-half percent (0.50%) July 1, 2012........................................................One percent (1.0%) July 1, 2013...................................One and one-half percent (1.5%) July 1, 2014.........Two and twenty-five hundredths percent (2.25%) July 1, 2015, and thereafter..............Three percent (3.0%) for a total of three and seventy-five hundredths percent (3.75%) when added to the contributions required under KRS 161.420(5)(a); or b. For each individual who first becomes a member of the retirement <br>system on or after July 1, 2008, a total amount of annual <br>compensation equal to and effective on: July 1, 2013..............................................One-half percent (0.50%) July 1, 2014.........One and twenty-five hundredths percent (1.25%) July 1, 2015, and thereafter................Two percent (2.0%) for a total of three and seventy-five hundredths percent (3.75%) when added to thecontributions required under KRS 161.420(5)(a) 2. Notwithstanding subparagraph 1. of this paragraph, members employed <br>by any employer identified in KRS 161.220(4)(b) or (n) shall contribute, <br>as a percentage of their total annual compensation, the actuarial <br>equivalent of the percentage contributed by members under <br>subparagraph 1. of this paragraph, not to exceed the percentages <br>established under the schedules set forth in subparagraph 1. of this <br>paragraph. The actuarial equivalent to be contributed under this <br>subsection shall be determined by the retirement system's actuary. These <br>contributions shall be in lieu of those contributions required under <br>subparagraph 1. of this paragraph. 3. When the medical insurance fund established under KRS 161.420(5) <br>achieves a sufficient prefunded status as determined by the retirement <br>system's actuary, the board of trustees shall recommend to the General <br>Assembly that the contributions required under subparagraphs 1. and 2. <br>of this paragraph shall, in an actuarially accountable manner, be either <br>decreased, suspended, or eliminated. (d) Payments authorized by statute that are made to retiring members, who became members of the system before July 1, 2008, for not more than sixty <br>(60) days of unused accrued annual leave shall be considered as part of the <br>member's annual compensation, and shall be used only for the member's final <br>year of active service. The contribution of members shall not exceed these <br>applicable percentages on annual compensation. When a member retires, if it <br>is determined that he has made contributions on a salary in excess of the <br>amount to be included for the purpose of calculating his final average salary, <br>any excess contribution shall be refunded to him in a lump sum at the time of <br>the payment of his first retirement allowance. In the event a member is <br>awarded a court-ordered back salary payment the employer shall deduct and <br>remit the member contribution on the salary payment, plus interest to be paid <br>by the employer, to the retirement system unless otherwise specified by the <br>court order. (2) Each public board, institution, or agency listed in KRS 161.220(4) shall, solely for the purpose of compliance with Section 414(h) of the United States Internal <br>Revenue Code, pick up the member contributions required by this section for all <br>compensation earned after August 1, 1982, and the contributions so picked up shall <br>be treated as employer contributions in determining tax treatment under the United <br>States Internal Revenue Code and KRS 141.010(10). The picked-up member <br>contribution shall satisfy all obligations to the retirement system satisfied prior to <br>August 1, 1982, by the member contribution, and the picked-up member <br>contribution shall be in lieu of a member contribution. Each employer shall pay <br>these picked-up member contributions from the same source of funds which is used <br>to pay earnings to the member. The member shall have no option to receive the <br>contributed amounts directly instead of having them paid by the employer to the <br>system. Member contributions picked-up after August 1, 1982, shall be treated for <br>all purposes of KRS 161.220 to 161.714 in the same manner and to the same extent <br>as member contributions made prior to August 1, 1982. Effective: July 1, 2010 <br>History: Amended 2010 Ky. Acts ch. 159, sec. 3, effective July 1, 2010; and ch. 164, sec. 6, effective July 1, 2010. -- Amended 2008 (1st Extra. Sess.) Ky. Acts ch. 1, <br>sec. 34, effective June 27, 2008. -- Amended 2008 Ky. Acts ch. 11, sec. 1, effective <br>April 7, 2008; and ch. 78, sec. 9, effective July 1, 2008. -- Amended 2002 Ky. Acts <br>ch. 275, sec. 16, effective July 1, 2002. -- Amended 1996 Ky. Acts ch. 359, sec. 8, <br>effective July 1, 1996. -- Amended 1994 Ky. Acts ch. 369, sec. 12, effective July 1, <br>1994; and ch. 469, sec. 35, effective July 15, 1994. </p>
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