Benefit Changes from 2011 Legislature

Senate Substitute for HB 2194 was signed into law in 2011, making changes to KPERS starting in 2014. There are still more steps to complete before these changes can take effect.

Affected: employers, current and future KPERS members (for future service only)
Not Affected: all current retirees, KP&F and Judges plans

Important

For benefit and contribution changes to become effective, these trigger action items need to be completed.

HB 2194 Benefit Changes (from 2011)

# 2 — Employer Contribution Increases

Raises the cap on employer contribution rate increases from the current 0.6 percent.
FY 2014 0.9%
FY 2015 1.0%
FY 2016 1.1%
FY 2017+ 1.2%

# 3 — Tier 1 Members: Contribution Increase or Benefit Decrease (future service only)

6% contribution	1.85% multiplier	default option
– or –
4% contribution	1.4% multiplier

• 90-day election starting July 2013 to choose between Tier 1 options
• Election pending IRS approval
• Does not affect service you already have
• Changes effective January 2014

# 4 — Tier 2 Members: Benefit Decrease or Lose COLA (future service only except COLA)

6% contribution	1.75% multiplier Lose COLA (for all service, not just future)	default option
– or –
6% contribution	1.4% multiplier Keep COLA

• 90-day election starting July 2013 to choose between Tier 2 options
• Election pending IRS approval
• Multiplier change does not affect service you already have
• COLA loss is for all service credit over your entire career
• Changes effective January 2014
• New employees automatically have 6%/1.75%/no COLA

#5 —Inactive Members

Inactives returning to employment after July 2013 will have the default for their tier.

#6 —Surplus Property

80% of proceeds from excess real estate property sales will be used to pay down KPERS' unfunded liability.