SESSION OF 2021
SUPPLEMENTAL NOTE ON SENATE BILL NO. 265
As Recommended by Senate Committee on
Financial Institutions and Insurance

Brief*
SB 265 would authorize the Governor’s allotment for the
Kansas Public Employees Retirement System (KPERS)
Death and Disability Program and institute a moratorium on
all payments made by KPERS employers for Fiscal Year (FY)
2021.

Background
The bill was introduced by the Senate Committee on
Ways and Means at the request of Senator Hawk.
The Governor’s July 2020 State General Fund Allotment
Plan included a moratorium on the State employer
contributions to the KPERS Death and Disability Trust Fund
for all of FY 2021. The allotment applies to both State and
school employers. The allotment authority of the Governor
does not apply to local employers.

Senate Committee on Financial Institutions and
Insurance
In the Senate Committee hearing, a representative of
KPERS provided neutral information regarding the KPERS
Death and Disability Plan, noting this plan provides basic life
insurance and long-term disability benefits to all KPERS
members. All KPERS employers contribute a statutory 1.0
____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
percent of pay for the plan; there is no employee contribution.
The plan is currently funded as a pay-as-you-go plan. The
representative noted, however, the 1.0 percent employer
contribution rate generates enough contributions for the
balance of the Death and Disability Trust Fund to slowly
increase over time, which allows this fund to maintain a
balance during periods of employer contribution moratoria.
The representative indicated, in order for the moratorium to
be applied consistently to the entire KPERS group, which
would be consistent with past moratoria, additional statutory
language is needed.
No other testimony was provided.

Fiscal Information
According to the fiscal note prepared by the Division of
the Budget, the bill would statutorily authorize the Governor’s
allotment for the Death and Disability Program for payments
for state agencies in FY 2021. The normal cost for
participating KPERS employers for the Death and Disability
Program is 1.0 percent of payroll each year. The Division of
the Budget estimates that, during FY 2021, total payments to
the Group Insurance Reserve Fund, before the Governor’s
July 2020 allotment plan was implemented, was estimated to
be $60,070,659 from all funding sources, including
$47,438,029 from the State General Fund (SGF). The
Governor’s allotment plan suspended these Death and
Disability Program payments to the fund and KPERS re-
certified the employer contribution rates for all state agencies
by reducing employer contributions by 1.0 percent for FY
2021. However, because the Governor’s allotment authority
only allows the Governor to reduce SGF appropriations for
the Executive Branch, the Governor’s plan reduced SGF
appropriations totaling $46,687,965 for the Death and
Disability Program costs of the Executive Branch. The
remaining SGF reductions of $525,289 for the Judicial Branch
and $224,775 for the Legislative Branch were included as

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overall FY 2021 revised expenditures in The FY 2022
Governor’s Budget Report.
The fiscal note also outlines the effect on local
employers, indicating the bill would reduce employer
contributions to KPERS for the Death and Disability Program
by 1.0 percent, from July 1, 2021, to June 30, 2022. KPERS
estimates that the bill would save approximately $20.0 million
for these local KPERS employers during this period.
State budget; allotment; KPERS Death and Disability program; Group Insurance
Reserve Fund


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Statutes affected:
As introduced: 74-4927, 74-4901