HCS1AA.pdf

Mr. David
Eager
March 6, 2018
Page 2

March 6, 2018

Mr. David Eager
Interim Executive Director Kentucky Retirement
Systems 1260 Louisville Road
Frankfort, KY 40601
Re:

BR 427 SB 1 SCS
AA Statement 1 of 4
KERS and CERS Non-Hazardous Systems

Dear Mr. Eager:
We have reviewed and analyzed the summary of proposed changes in the proposed pension
reform legislation SB 1 Sub 1. The purpose of this letter is to communicate to the fiscal analysis
of this proposed legislation on the retirement and insurance funds maintained by the Kentucky
Retirement System (KRS) as it applies to the Non-Hazardous Systems (i.e. KERS NonHazardous and CERS Non- Hazardous).
The provisions of this legislation are similar to that proposed in SB 1, with a notable difference of
resetting the amortization period for financing the unfunded actuarial accrued to a closed 30-year
period beginning with the July 1, 2019 actuarial valuation. In addition, compared to the original
SB 1, this proposed legislation, SB 1 Sub 1, requires Tier I members who became participating on
or after July 1, 2003 (but prior to September 1, 2008) to contribute 1% of pay to the Health
Insurance Fund.