{"data":{"id":"us-ky/krs-61.5991","jurisdiction":"us-ky","citation":"KRS 61.5991","heading":"Quasi-governmental employers participating in KERS -- Required reports","body":"-- Audits -- Legislative intent regarding future appropriations to subsidize\nretirement costs -- Non-core services independent contractor.\nExcept as otherwise provided by this  section, the following shall apply to nonhazardous\nemployers in the Kentucky Employees Retirement System, who contributed to the system\nin fiscal year 2019-2020 except in the case of county attorneys, who are local and district\nhealth departments governed  by KRS Chapter 212, state -supported universities and\ncommunity colleges, county attorneys, mental health/mental retardation boards, domestic\nviolence shelters, rape crisis centers, child advocacy centers, or any other agency that is\neligible to voluntarily cease participation in the Kentucky Employees Retirement System\nas provided by KRS 61.522:\n(1) (a) Each employer, except for county attorneys, shall report to the Authority for\neach fiscal year occurring on or after July 1, 2021, the following persons fo r\nwhich no employer contributions were paid by the employer to the system\nduring the fiscal year for services provided to the employer:\n1. Except as provided by paragraph (b)3. of this subsection, persons\nemployed as an independent contractor, a leased emp loyee, or via any\nother employment arrangement as determined by the Authority, who if\nemployed directly by the employer would qualify as a regular full -time\nemployee in accordance with KRS 61.510(21); and\n2. Persons employed directly by the employer who me et the definition of a\nregular full-time employee in accordance with KRS 61.510(21), who are\nnot being reported to the system in accordance with KRS 61.675.\n(b) The reporting required by this paragraph shall:\n1. Be reported in a format, detail, and frequen cy as determined solely by\nthe Authority;\n2. Except as provided by subparagraph 3. of this paragraph, include\npersons providing services to the employer as an independent contractor,\na leased employee, or via any other employment arrangement as\ndetermined by the Authority, and those services have historically been\nprovided or are currently being provided by employees eligible to\nparticipate in the system through the employer; and\n3. Exclude:\na. Contracts for professional services that have not historically been\nprovided by employees of the employer;\nb. Any contracts entered into prior to January 1, 2021, with a person\nor company to provide services as an independent contractor, a\nleased employee, or other employment arrangement as determined\nby the Authority, but only for the duration of the original contract,\nexcluding any renewal periods, and only for those services and\npersons included in the original contract, except as provided in\nsubdivision c. of this subparagraph; and\nc. Contracts providing services through a non -core services\nindependent contractor as defined in subsection (9) of this section,\nregardless of whether or not the contract was initiated before\nJanuary 1, 2021, or on or after January 1, 2021.\n(c) In any case of doubt, the Authority shall determine whether data should be\nreported on a specific person providing services to the employer and the\nAuthority may by promulgation of administrative regulation provide guidance\non which persons should be included for reporting purposes;\n(2) (a) Notwithstanding any other provision of statute to the contrary, the Authority\nshall:\n1. Have full power, including any authority under KRS 61.685, to audit an\nemployer who is subject to the provision s of this section to ensure\ncompliance and accuracy of the data required to be reported by the\nemployer in accordance with this section; and\n2. Perform audits on a percentage of employers who are subject to the\nreporting requirements of this subsection, as  determined by the board,\nfor the purpose of ensuring that all eligible employees are being reported\nand contributions are being paid in accordance with KRS 61.510 to\n61.705. The system shall have full power and authority, including any\nauthority and power  granted under KRS 61.675 and 61.685, to\naccomplish the audits required by this subparagraph. An audit time\nframe and schedule shall be adopted by the board, made available to\nimpacted employers, and reported to the Public Pension Oversight\nBoard.\n(b) If the Authority determines an employer has knowingly falsified data required\nto be reported under this section:\n1. The Authority shall indicate in the annual report submitted in\naccordance with subsection (3) of this section that the employer has\nknowingly fa lsified data and shall include a brief summary of the\nreasons for the Authority's determination;\n2. The employer shall no longer be eligible to receive any future\nappropriations or subsidies from the state to assist in paying employer\ncontributions to the system; and\n3. The employer shall be required to pay back to the state any\nappropriations or subsidies provided in the biennial executive branch\nbudget that were used to directly assist the employer in paying employer\ncontributions to the system on or after July 1, 2021.\n(c) If an employer fails to submit the information required by this section or does\nnot comply with requests from the Authority regarding this subsection and\nsubsection (1) of this section to verify or audit the employer's information:\n1. The Authority shall indicate in the annual report submitted in\naccordance with subsection (3) of this section that the employer is\nnoncompliant with the Authority's requests and shall include a brief\nsummary of the reasons for the Authority's determination; and\n2. The employer may lose eligibility to receive any future appropriations or\nsubsidies from the state to assist in paying employer contributions to the\nsystem, except that if an employer does not comply with requests from\nthe Authority pursuant to an audit conducted in accordance with\nparagraph (a)2. of this subsection the employer shall lose eligibility to\nreceive any future appropriations or subsidies from the state to assist in\npaying employer contributions to the system until such time as the\nemployer complies with the audit;\n(3) The Authority shall within sixty (60) days following the close of each fiscal year\noccurring on or after July 1, 2021, determine and report the following to the state\nbudget director's office and the Legislative Research Co mmission for each\nemployer subject to this section, except for county attorneys:\n(a) The number of regular full -time employees of the employer who were\nreported to the system during the prior fiscal year for which contributions\nwere reported in accordance with KRS 61.675;\n(b) The number of persons providing services to the employer under subsection\n(1) of this section during the prior fiscal year who were not reported to the\nsystem and for which no contributions were reported;\n(c) A percentage computed by d ividing the number of employees reported in\nparagraph (a) of this subsection by the combined sum of the number of\nemployees and persons reported in paragraphs (a) and (b) of this subsection\nand multiplying by one hundred (100); and\n(d) The information requ ired by subsection (2) of this section for any employer\nwho has been determined by the Authority to have knowingly falsified data or\nis noncompliant in submitting the data required by this section to the\nAuthority;\n(4) It is the intent of the General Assem bly in fiscal years occurring on or after July 1,\n2021, to provide appropriations for county attorneys for retirement costs in the\nKentucky Employees Retirement System that is equal to the difference between the\ndollar value of actual contributions paid by  the employer in fiscal year 2019 -2020\nto the system and the dollar value of contributions projected to be paid by the\nemployer to the system in fiscal year 2021-2022;\n(5) For fiscal year 2021 -2022, it is the intent of the General Assembly to provide a\nsubsidy towards the retirement costs of employers covered by this section, except\nfor county attorneys who are provided a subsidy by subsection (4) of this section,\nthat is equal to the difference between the dollar value of actual contributions paid\nby the e mployer to the system in fiscal year 2019 -2020 and the dollar value of\ncontributions projected to be paid by the employer to the system in fiscal year 2021-\n2022;\n(6) It is the intent of the General Assembly that for fiscal years occurring on or after\nJuly 1, 2022:\n(a) To provide a subsidy towards the retirement costs of each employer subject to\nthis section, except for county attorneys who are provided a subsidy by\nsubsection (4) of this section, who has made efforts to increase or maintain the\nnumber of em ployees reported to the system. Specifically, it is the intent of\nthe General Assembly to provide subsidies only to those employers who have\na percentage of employees reported to the system as specified by subsection\n(3)(c) of this section, equal to or greater than:\n1. Sixty percent (60%) for any subsidies provided in fiscal years occurring\non or after July 1, 2022, to June 30, 2024; and\n2. Eighty pe rcent (80%) for any subsidies provided in fiscal years\noccurring on or after July 1, 2024.\nEligibility for a subsidy provided in each fiscal year of the budget shall be\nbased upon the most recent percentage of employees reported by the\nAuthority;\n(b) For those employers eligible for a subsidy under paragraph (a) of this\nsubsection, to provide a subsidy that is equal to the dollar value of the subsidy\nprovided to the employer in fiscal year 2021-2022 multiplied by the following\npercentage:\n1. For local and district health departments governed by KRS Chapter 212,\nstate-supported universities and community colleges, and any other\nemployer subject to this section that has taxing or fee authority:\na. Ninety percent (90%) in fiscal year 2022-2023;\nb. Eighty percent (80%) in fiscal year 2023-2024;\nc. Seventy percent (70%) in fiscal year 2024-2025;\nd. Sixty percent (60%) in fiscal year 2025-2026; and\ne. Fifty percent (50%) in fiscal years occurring on or after July 1,\n2026; and\n2. For any other employer who does not have taxing or fee authority:\na. Ninety percent (90%) in fiscal years 2022-2024; and\nb. Seventy-five percent (75%) in fiscal years occurring on or after\nJuly 1, 2024; and\n(c) The subsidy provided by this subsection shall be adjusted to reflect the\nassignment of liabilities based upon the appeal process in KRS\n61.565(1)(d)5.;\n(7) The Council on State Governments (CSG), the Kentucky Educational Television\n(KET) Foundation, Association of Commonwealth's Attorneys, the Kentucky High\nSchool Athletic Association  (KHSAA), the Municipal Power Association of\nKentucky, the Kentucky Office of Bar Admissions, the Nursing Home\nOmbudsman, the Kentucky Association of Regional Programs (KARP), and the\nKentucky Association of Sexual Assault Programs are, notwithstanding the\nprovisions of subsections (1) to (6) of this section, exempt from the reporting\nrequirements and from receiving a subsidy to assist in paying employer contribution\nrates;\n(8) The provisions of this section shall not obligate the General Assembly to provid e\nany specific level of subsidy to assist in paying employer contributions of any\nemployer covered by this section, and employers shall be responsible for any and\nall future retirement contributions payable by the employer regardless of the actual\namount of subsidy included in future executive branch budgets; and\n(9) For purposes of this section, \"non -core services independent contractor\" means a\ncompany or business that is not owned or controlled, in whole or in part, by an\nemployer participating in the sy stem, whose business is not limited to providing\nservices to one (1) or more employers participating in the system, but instead also\nprovides services to the general public or other public agencies not participating in\nthe system, which are limited to faci lities services, grounds services, custodial\nservices, bookstore services, dining services, construction services, trade or\nmaintenance services, health services for university students and employees of the\nemployer, information technology services, public  relation services, photography\nservices, design services, safety services at universities, hospitality services,\nentertainment production services, mail services, printing and copier services,\nsports arena and stadium management, farrier services, assisti ve services at\nuniversities such as interpreters or sign language services, or delivery services.","path":["KRS Chapter 61"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=52180","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:49:15Z","sha256":"c90e874bd5a778ed9094ea6afa1b0cf678f504b83d2af0af5e8e9bdae18ee644","source_id":"us-ky","stale":false,"prev":"us-ky/krs-61.599","next":"us-ky/krs-61.600"},"notice":"GroundRules: Original legal text. Not legal advice."}