KRS 161.640: Payment of annuities -- Payroll deductions -- Electronic fund transfer,

exception -- Payments to special needs trust.

(1) Retirement annuities shall be payable monthly. The first payment to an annuitant

shall be made at the payment date at the end of one (1) full payment period after his

retirement and shall consist of one (1) regular monthly payment. Retirement for a

member receiving one (1) full year of service credit during a fiscal year shall be no

earlier than July 1 next following the en d of such fiscal year. Notwithstanding any

other statutory provisions to the contrary, members filling positions that

customarily require twelve (12) months of service during a fiscal year cannot retire

prior to July 1 without a corresponding pro rata redu ction in salary and service

credit. The board of trustees may determine which positions customarily require

twelve (12) months of service during a fiscal year.

(2) The board of trustees may enter into agreements with retired members for payroll

deductions when it is deemed in the best interest of the retired members and the

retirement system.

(3) (a) All new retirees, on or after July 1, 1998, shall receive their monthly annuity

checks by electronic fund transfer. All retiree, beneficiary, and survivor

monthly allowance payments, except as otherwise provided in paragraph (b)

or (c) of this subsection, shall be made by electronic fund transfer. Except as

provided in paragraph (b) or (c) of this subsection, all monthly payments shall

be made payable only to an account solely in the name of the retiree,

beneficiary, or survivor as an individual and natural person, or to a joint

account in the name of the retiree, beneficiary, or survivor as an individual

and natural person and another individual and natural person.

(b) If the retiree, beneficiary, or survivor is a resident of a nursing or assisted-care

home, monthly payments may be made to the order of the nursing or assisted -

care home for the benefit of the retiree, beneficiary, or survivor by including

the retiree's, beneficiary's, or survivor's name. Monthly annuity checks so paid

to a nursing or assisted -care home may be sent by mail rather than electronic

fund transfer.

(c) If the retiree, beneficiary, or survivor is the sole beneficiary of a special needs

trust:

1. Monthly payments shall be made to the order of the special needs trust,

and checks may be sent by mail to the special needs trust for the benefit

of the retiree, beneficiary, or survivor;

2. Upon the death of the retiree, beneficiary, or survivor o f a special needs

trust, the trustee of that trust shall notify the Teachers' Retirement

System;

3. Any payments made to a special needs trust that are not properly

payable to the special needs trust shall be returned to the Teachers'

Retirement System and shall not be subject to claims for reimbursement

from any state for Medicaid benefits paid on behal f of the beneficiary

under any Medicaid payback provision, and any overpayments of

retirement allowance received by the special needs trust shall be repaid

to the Teachers' Retirement System; and

4. The Teachers' Retirement System may promulgate administra tive

regulations in accordance with KRS Chapter 13A to administer this

paragraph.