{"data":{"id":"us-ky/krs-65.156","jurisdiction":"us-ky","citation":"KRS 65.156","heading":"Actuarial valuation requirement for local government pension systems --","body":"Exemptions -- Copy to Legislative Research Commission -- Contributions by\ncities, municipal agencies, urban -county governments, or consolidated local\ngovernments -- Payment of lawf ul expenses -- Prohibition against creation or\nmaintenance of defined benefit retirement system susceptible of unfunded\nliability -- Exceptions.\n(1) The governing board of any local government retirement system created pursuant to\nKRS 67A.320, 67A.340, 6 7A.360 to 67A.690, 79.080, 90.400, 90.410, 95.290,\n95.520 to 95.620, 95.621 to 95.629, 95.767 to 95.784, 95.851 to 95.884, or KRS\nChapter 96 shall submit the retirement system to an actuarial valuation, if the\nsystem provides a defined benefit, at least:\n(a) Once every three (3) years if the system has six (6) or more active and retired\nmembers; or\n(b) Once every five (5) years if the system has less than six (6) active and retired\nmembers.\nThe valuation shall be prepared by an actuary who is a fellow of t he Society of\nActuaries, a member of the American Academy of Actuaries, or an enrolled actuary\nunder the Employees' Retirement Income Security Act of 1975. The board shall\nsend a copy of the most recent valuation to the librarian of the Legislative Researc h\nCommission by September 1, 1982, and thereafter the board shall send a copy of\neach new valuation within ten (10) days of receipt. If all liabilities to all individuals\nentitled to benefits from the local government retirement system have been\nsatisfied, no actuarial valuation shall be required.\n(2) Actuaries performing valuations pursuant to this section shall use the entry age\nnormal cost funding method. Their reports shall include a definition of each\nactuarial term and an explanation of each actuarial  assumption used. Assumptions\nshall be reasonably related to the experience of the system and represent the\nactuary's best estimate of anticipated experience.\n(3) Any city or municipal agency with a retirement system created pursuant to KRS\n79.080, 90.400,  90.410, 95.520 to 95.620, 95.621 to 95.629, 95.767 to 95.784,\n95.851 to 95.884, or KRS Chapter 96 which is closed to new members pursuant to\nKRS 78.530, 95.520, 95.621, or 95.852 shall, if its local pension system provides a\ndefined benefit, contribute an nually to the pension system, for the benefit of the\nretirees of the system and the active participants who choose to remain in the\nsystem, and for the benefit of members who have completed at least twenty (20)\nyears' service and withdrawn from service pur suant to KRS 95.857, an amount\nequal to that which would be required pursuant to the funding standards of KRS\n95.868, plus so much of the principal amount of any unfunded prior service liability\nas the actuary states is necessary to maintain cash flow adeq uate to pay retiree and\nbeneficiary payments until financial obligations to all retirees and beneficiaries are\nfully satisfied.\n(4) All lawful expenses for general administration, performance bonds, medical,\nactuarial, accounting, auditing, legal, and investment services of a retirement system\nlisted in subsection (1) of this section shall be paid from the pension fund. Actuaries\nperforming valuations pursuant to this section shall include estimates of the\nexpenses in their recommendations for pension syste m funding, and local\ngovernments shall add payments for the expenses to their annual contributions to\ntheir respective retirement systems.\n(5) A city or city agency, consolidated local government, or urban -county government\nmay, pursuant to KRS 67A.340, 79 .080, 90.410, or KRS Chapter 96 as applicable,\nprovide for the retirement security of its employees through the creation of a money\npurchase or defined contribution plan qualified under Section 401(a) of the Internal\nRevenue Code of 1954 as amended. City e mployee deferred compensation plans\ncreated pursuant to KRS 18A.270, or money purchase or defined contribution plans,\nqualified under Section 401(a) of the Internal Revenue Code of 1954 as amended,\nwhich by their nature cannot have an unfunded liability, s hall not be subject to the\nactuarial valuation requirements of this section, and shall not be subject to\ntermination for purposes of employee entry into the County Employees Retirement\nSystem, as required by KRS 78.530, 79.080, 90.410, and 96.180.\n(6) No c ity or county, except an urban -county, or special district, nor any agency or\ninstrumentality of a city or county or special district shall create or maintain for its\nofficers or employees a defined benefit retirement system, which by its nature can\nhave a n unfunded liability. The provisions of this subsection shall not preclude\nemployer contributions for city managers or other appointed local government\nexecutives who participate, pursuant to KRS 78.540, in a retirement system which\noperates in more than o ne (1) state, nor the continuation of a local government\ndefined benefit retirement system which has been closed to new members but which\nmust fulfill its obligations to current active members, retirees, and beneficiaries.\nNotwithstanding any provision to the contrary, the provisions of this subsection\nshall not apply to length of service awards programs established for the benefit of\nvolunteer firefighters and volunteer life squad and volunteer rescue personnel.\n(7) Notwithstanding any provision to the con trary, any city or county may establish\nawards programs that recognize the length of service to the community by volunteer\nfirefighters, volunteer life squads, and volunteer rescue personnel.","path":["KRS Chapter 65"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=44972","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:49:20Z","sha256":"ebd4a2d885d4e55d25ab4dec2a571ce12f60ff595fb9a742cfd1010575b95113","source_id":"us-ky","stale":false,"prev":"us-ky/krs-65.155","next":"us-ky/krs-65.157"},"notice":"GroundRules: Original legal text. Not legal advice."}