KPERS Update

The KPERS Study Commission met on Wednesday and Thursday of this week to determine the recommendations it will make to the Legislature in January. Although there is still a question whether HB 2194 will apply, right now it appears that employees vested in KPERS by July 1, 2013, will not see significant changes to their retirement plan.

Unvested employees and new hires as of that date will be moved into a defined contribution plan. Employees in this group will be required to pay 6% of their salary toward a defined contribution plan. The employer will then match the employee's salary based on the employee's years of service. An employee will receive a 1% match for the first year of service. The match will then increase .5% for every year of employment up to 5% after nine years.

In addition, the Commission approved the following recommendations: (1) Treat legislators the same as unvested employees and new hires as of July 1, 2013, and require them to be in a defined contribution plan; (2) include only the salary actually earned by legislators in future retirement calculations; (3)remove the statutory cap on employer contributions and require that employers pay the actuarially required contribution to eliminate the unfunded liability; (4) eliminate the buy-back of service credit; (5) purchase bonds to pay the unfunded liability; and (6) keep the current disability benefits in place for unvested employees and new hires. Keep in mind legislative action will be required before any of these changes are implemented. Please contact your legislator if you have concerns.