RELATES TO:
KRS
161.440,
161.580,
161.705
NECESSITY, FUNCTION, AND CONFORMITY:
KRS
161.440 requires crediting interest, as
defined in
KRS
161.220(13), to the various
funds of the Teachers' Retirement System, and
KRS
161.580 requires that individual accounts be
maintained for each member of the system. This administrative regulation sets
out the procedures to be followed in crediting interest to each member's
account.
Section 1. For individuals who
became members prior to July 1, 2008, interest at the rate of three (3) percent
shall be credited to the member's account as long as the member is in active
status with the retirement system. For individuals who become members on or
after July 1, 2008, interest at the rate of two and one-half (2.5) percent
shall be credited to the member's account as long as the member is in active
status with the retirement system.
Section
2. For purposes of this administrative regulation "active status"
means the status of a member who has vested with at least five (5) years of
service credit with the retirement system. Members with less than five (5)
years of service credit shall be deemed to be in active status if they have had
any service in the most recent three (3) years.
Section 3. No interest shall be credited to
member accounts during the first fiscal year of membership. Subsequent to the
first fiscal year of membership, interest shall be credited as of June 30 of
each year of active status.
Section
4. At the end of each fiscal year, interest shall be assigned from
the guarantee fund to individual funds as follows:
(1) The teachers' savings fund and the state
accumulation fund shall be assigned equal amounts of interest in accordance
with Sections 1, 2, and 3 of this administrative regulation.
(2) The allowanced reserve fund shall be
assigned interest based upon the average month end balance of the fund for each
fiscal year.
