This bill establishes the Liability Reduction Fund within the Kansas Public Employees Retirement System (KPERS) and mandates the transfer of $1 billion from the budget stabilization fund to this new fund. The primary purpose of the Liability Reduction Fund is to reduce the unfunded actuarial liability of KPERS. A portion of the interest earnings from this fund will be used to provide a 2% cost-of-living adjustment to retirees who retired on or before July 1, 2020, effective from July 1, 2025. The bill also outlines the management and investment responsibilities of the board of trustees of KPERS regarding the fund's assets, ensuring that investments are made prudently and in the best interest of the fund.

Additionally, the bill amends existing law regarding the budget stabilization fund, specifically changing the conditions under which funds can be expended or transferred. It specifies that, starting July 1, 2025, no funds from the budget stabilization fund can be used without legislative approval, except for the transfer to the Liability Reduction Fund. The bill repeals the previous version of K.S.A. 2024 Supp. 75-6706 and introduces new provisions to ensure that the management of the Liability Reduction Fund aligns with the goals of reducing KPERS' unfunded liabilities while providing necessary adjustments to retirees.

Statutes affected:
As Introduced: 74-4907, 74-4901, 75-6706
As introduced: 74-4907, 74-4901, 75-6706