Program Review and Investigations Committee




<MeetMDY1> November 12, 2015


Call to Order and Roll Call

The<MeetNo2> Program Review and Investigations Committee met on<Day> Thursday,<MeetMDY2> November 12, 2015, at<MeetTime> 10:00 AM, in<Room> Room 131 of the Capitol Annex. Senator Danny Carroll, Chair, called the meeting to order. The Pledge of Allegiance was recited followed by an opening prayer by Senator Westerfield. The secretary called the roll.


Present were:


Members:<Members> Senator Danny Carroll, Co-Chair; Representative Martha Jane King, Co-Chair; Senators Tom Buford, Perry B. Clark, Christian McDaniel, Stephen West, and Whitney Westerfield; Representatives Tim Couch, David Meade, Terry Mills, Ruth Ann Palumbo, Rick Rand, and Arnold Simpson.


Legislative Guest: Representative Denver Butler.


Guests: J. Michael Brown, Secretary, and John Bizzack, Commissioner of Department of Criminal Justice Training, Justice and Public Safety Cabinet; William Theilen, Executive Director, and Brian Thomas, General Counsel, Kentucky Retirement Systems.


Special Guest: Attorney General-Elect Andy Beshear.


LRC Staff: Greg Hager, Committee Staff Administrator; Chris Hall; Colleen Kennedy; Van Knowles; Jean Ann Myatt; Chris Riley; William Spears; Shane Stevens; Joel Thomas; Ashleigh Hayes, Graduate Fellow; and Kate Talley, Committee Assistant.


Minutes for October 8, 2015

Upon motion by Senator McDaniel and second by Representative Palumbo, the minutes for the October 8, 2015, meeting were approved by voice vote, without objection.


Staff Report: Kentucky Law Enforcement Foundation Program And Kentucky Firefighter Foundation Program Funds

Jean Ann Myatt said the sole source of revenue for the Kentucky Law Enforcement Foundation Program and Kentucky Firefighter Foundation Program Funds is a surcharge on specified types of insurance premiums. In fiscal year 2014, surcharge revenue was $103 million. On average, the surcharge collected from Kentucky-based insurers accounts for 17 percent of total revenue collected each year. The Commissioner of Revenue is responsible for annually reviewing the financial needs of the two funds and adjusting the surcharge rate as needed. The rate has been changed once when it was increased from 1.5 percent to 1.8 percent in 2010. Surcharge revenue is deposited in a State Treasury account specifically dedicated to the law enforcement and firefighter funds. Surcharge receipts collected from Kentucky-based insurance companies are allocated to the firefighter fund. Receipts collected from other insurance companies are divided between the two funds by the Finance and Administration Cabinet. Statute requires the cabinet to request quarterly cost projections from the Department of Criminal Justice Training (DOCJT) and the Commission on Fire Protection, Personnel, Standards, and Education and use these projections to determine the division. Cabinet officials no longer make these quarterly requests because they already have sufficient historical information to determine if changes in allocations are required. Since 2000, the law enforcement fund has received 72 percent of the non-Kentucky based surcharge revenue, and the firefighter fund has received 28 percent. As a percentage of all receipts collected, the split is typically 60 percent to the law enforcement fund and 40 percent to the firefighter fund. DOCJT and Fire Commission staff work with the Office of State Budget Director staff to produce expense projections, which are used to set quarterly allotments in eMARS.


According to statute, the Commissioner of Revenue should base calculations on the number of eligible local government units participating in the funds when considering the surcharge rate. Officials with the Office of State Budget Director said this is no longer the most accurate way to calculate financial needs. The long-term trends of law enforcement officers and firefighters participating in each fund are more useful. Recommendation 1.1 is that the General Assembly may wish to consider changing the statutory language for surcharge rate calculation to use as its base trends of participating law enforcement officers and firefighters and budget bill appropriations instead of the number of local government units participating in each fund.


With the advent of eMARS, the quarterly reporting requirements may be unnecessary. Recommendation 1.2 is that the General Assembly may wish to consider updating the quarterly reporting requirement in KRS 42.190(1) to account for information available through Kentucky’s financial reporting system.


William Spears said that the law enforcement fund supports DOCJT, which is responsible for training and certifying law enforcement officers. The department uses the fund to provide training incentives to officers and to support the Criminal Justice Council and the Kentucky Law Enforcement Council.


In FY 2014, the fund was appropriated $61 million and $18 million was transferred to the general fund. In FY 2014, almost all spending went toward incentive pay and training. DOCJT uses the fund to operate its facility, providing basic and in-service training for law enforcement officers.


Historically, budget language explicitly authorized the use of fund revenue for training. However, since at least 2000, budget language has not specified that fund revenue can be used to operate the department. Recommendation 2.1 is if it is the intent of the General Assembly that the Law Enforcement Foundation Program Fund be used for operating the DOCJT facility, it may wish to consider revising the statute or resume adopting budgetary language to authorize this.


Officers are not charged for training and course expenditures are supported by the law enforcement fund. In FY 2014, the total cost of hourly training was $15.6 million. The cost per hour was $27.49. The Kentucky State Police and the Lexington and Louisville agencies conduct most of their own training. Moving all training to DOCJT’s facility would cost an additional $2.8 million per year. Department staff indicated the facility does not currently have sufficient personnel or space to accommodate potential trainees from these agencies.


Department staff monitor training through a database documenting each officer’s training hours and personnel records. The system is used during site audits to confirm the accuracy of agency records and whether officers have met annual minimum training hours. The department’s spending activities are monitored through weekly expenditure analyses delivered to executive staff. The analyses include the amount spent in the fiscal year, average spending, and project spending.


Revenue from the law enforcement fund is used for a training incentive pay program for officers. Officers meeting specified requirements receive $3,100 per year for completing training. Officers must be a full-time member of a local government or university that participates in the program. Officers complete 640 hours of training within the first year of employment and 40 hours each year thereafter. DOCJT reimburses local agencies for the extra pay. Law enforcement agencies pay officers the stipend in equal portions each pay period. DOCJT confirms incentive pay amounts by issuing monthly roster reports. Law enforcement agency staff must verify the information and return the report. Payments are halted if rosters are not submitted. DOCJT distributes the amount due to the local fiscal officer, who reimburses the law enforcement agency. From July 2009 to June 2014, participation remained stable, averaging approximately 7,300 officers per month.


Eight groups of officers meet the same standards as eligible officers but cannot participate because they are not associated with a local government. As of May 2015, extending eligibility to them would cost $1.3 million per year. The Department of Fish and Wildlife Resources currently uses its own funds to provide an identical stipend for its officers.


DOCJT’s Compliance and Auditing Section audits participating agencies on a 3-year cycle. Payroll records are checked to ensure officers receive the incentive, retirement participation is checked to ensure contributions are sent to the correct system, training records are compared against department records, time cards are checked to see if agencies are including time when officers are working with other government agencies, and overtime rates are examined to see if the incentive is included in overtime rate calculation. Compliance staff conduct yearly checks to determine if officers have met training requirements. Officers may request an extension, but if the officer does not complete training by a specified time the officer’s incentive payments are stopped and law enforcement authority is revoked. If an officer received incentive payments when ineligible, DOCJT initiates a recovery. Over the past 3 years, recoveries have decreased by 53 percent. Individual recoveries are relatively small, averaging $420. DOCJT is audited annually as part of the statewide single audit. The Auditor of Public Accounts conducts a digital review of department finances and requests additional information if potential issues are discovered. From FY 2010 to FY 2014, the audit contained no recommendations for the department.


The Criminal Justice Council is a 14-member board that guides state law enforcement policies through research and coordinating the efforts of stakeholders. The council and staff were originally funded with law enforcement fund revenue via budget language. Budgets have not included this language since the 2002-2004 biennial budgets. The council continues to be funded with law enforcement fund revenue. Other than budget language, Program Review staff could find no statutory or regulatory authority for the council to receive restricted law enforcement fund revenue. Recommendation 2.2 is if it is the intent of the General Assembly that the Criminal Justice Council receive Kentucky Law Enforcement Foundation Program Fund revenue, it may wish to consider revising the statute or biennially adopting budgetary language to authorize this. The council’s sole source of income is a transfer from DOCJT.


Statute authorizes law enforcement fund revenue to be used to operate the Kentucky Law Enforcement Council. The council’s responsibilities are to set standards for and certify law enforcement training schools, facilities, faculty, curriculum, and police officers and to monitor the law enforcement fund. Current annual expenses for the council are approximately $12,000. The council approves curriculum and certification standards required for law enforcement fund pay incentive eligibility. It also monitors the fund by receiving copies of all officer hiring documents and coordinating with department personnel to confirm training hours and certification. Other than statutory reporting requirements, no formal oversight measures are in place for the council. The council meets one reporting requirement by providing reports to the General Assembly on mandatory training courses established in the previous year and future training under consideration. The council also reports activities in DOCJT’s annual reports.


Chris Hall said that the firefighter fund is similar to the law enforcement fund, but there are important differences. Unlike the law enforcement fund, only a small portion of the firefighter fund is used for training; most of it is spent on programs that provide financial assistance to fire departments.


The firefighter fund is administered by the Fire Commission, which is attached to the Kentucky Community and Technical College System for administrative purposes. The Fire Commission, which is governed by a 19-member board, is charged with establishing the state's minimum education standards and training requirements for all firefighters. It also sets certification criteria for volunteer and professional firefighters and State Fire Rescue Training (SFRT) instructors. Daily operations are overseen by an executive director and staff, whose salaries are paid with firefighter fund revenue. KRS 95A.040 mandates that the Fire Commission promulgate administrative regulations to require that "each volunteer firefighter be able to read, write and understand the English language…is a person of sobriety and integrity…is and has been an orderly, law-abiding citizen…is a citizen of the United States, or otherwise lawfully present in the United States…and has reached the age of 18." Recommendation 3.1 is that the Fire Commission should promulgate administrative regulations in compliance with KRS 95A.040 (1)(d).


Almost all new revenue in any given year comes from the insurance surcharge. Such revenue in FY 2014 was $42 million, up from more than $37 million in FY 2011 and FY 2012. Over time, carryforward represents a larger portion of the fund's revenue, but the commission does not typically receive spending authority for this money. More than $7 million in FY 2013 and more than $9 million in FY 2014 was transferred to the general fund. Firefighter fund revenue is used to reimburse the SFRT division's budget for teaching the classes the commission requires all firefighters to take. This reimbursement is paid at a rate of $21 per instructional hour. The annual cost of paying for these classes varies from year to year, but typically represents less than 6 percent of all expenditures. The administrative cost category includes operational expense of the Fire Commission, and includes salaries and rent for the Lexington office. Typically, 70 percent of annual firefighter fund expenditures are for programs administered by the commission to assist fire departments.


To become a certified professional firefighter in Kentucky, a person must have a minimum education of a high school degree and complete a basic training course of at least 400 hours within one year of employment. To maintain certification, a professional firefighter must complete each calendar year an in-service training program appropriate to their rank and responsibility of at least 100 hours. To become a certified volunteer firefighter, a person must complete at least 150 hours of training within the first 2 years. Maintaining certification requires the successful completion each calendar year of at least 20 hours of in-service training. KRS 95A.090 mandates that the Fire Commission promulgate administrative regulations relating to the process of reviewing and applying candidate’s US military training as a firefighter toward their Kentucky certification. To date, no such administrative regulation exists. Recommendation 3.2 is that in accordance with KRS 95A.090, the Fire Commission should promulgate administrative regulations to govern the policy and procedures for reviewing and accepting US military service as a firefighter toward certification as a firefighter in Kentucky.


As of September 2015, the commission recognized 835 fire departments in Kentucky: 58 professional and 777 volunteer. To be classified as professional, at least 50 percent of the department’s firefighters must be full-time employees earning at least $8,000. A department is classified as volunteer when it has at least 12 members plus a chief, has at least one operational fire apparatus, and less than 50 percent of its firefighters are full-time paid employees. More than 80 percent of fire departments in Kentucky are staffed only by volunteer firefighters and slightly less than 5 percent are staffed only by professional firefighters. The State Fire Rescue Training division is funded with general fund appropriations and offers 20 hours of free training to each fire department. Fire Commission staff use a database to track training and run monthly reports to check that individual firefighters get the required training hours. The commission uses firefighter fund revenue to allot $8,250 annually to volunteer fire departments. Eligible departments may use this aid to purchase items from a commission-approved list, which includes extinguishers, personal protective gear, rescue equipment, ladders, and hoses. A department may hold its aid check for up to 5 years to purchase costlier items. Fire departments must submit to the commission proof of purchases made with the previous year's aid money. Fire Commission auditors check for each item purchased when visiting departments every 4 years. Statute requires the commission to promulgate administrative regulations relating to how the $8,250 state aid will be distributed if two or more volunteer fire departments merge or one splits into multiple departments. The commission has in-house policies and procedures related to this process, but there is no administrative regulation. Recommendation 3.3 is that in accordance with KRS 95A.530, the Fire Commission should promulgate an administrative regulation describing the manner in which volunteer fire districts should notify the commission of a merger or splitting of a volunteer fire district.


Statute authorizes the commission to use firefighter fund revenue to provide low-interest loans of up to $75,000 to volunteer fire departments. A department must remain qualified to receive state aid for the duration of the loan because the commission deducts the annual loan payment from the aid check, making the program self-sustaining. Over the past 5 years, the commission has made 57 loans for a total of more than $3 million. Fire Commission auditors check that loan money was used for its intended purpose when they visit a fire department.


By statute, eligible local governments are entitled to receive a $3,100 annual stipend for each qualified professional firefighter they employ plus an amount equal to the required employer's contribution to the defined-benefit pension plan. Fire departments must submit a request for funds to the commission every month that includes a list of all active professional firefighters on their roster. The commission checks these data with its records and ensures that each firefighter is up-to-date on required training before sending the incentive check. The number of firefighters participating in the training incentive program has remained relatively constant over the past 5 years, averaging about 3,700 participants per month.


Officials with the Kentucky Board of Emergency Medical Services estimate that approximately 8,000 EMS providers would be eligible for the training incentive program. Adding them would cost nearly $25 million annually, not including pension contributions.


Statute allows the Fire Commission to use firefighter fund revenue for a voluntary hepatitis B inoculation program, which allows professional and volunteer firefighters to receive the vaccine at no cost. The commission reimburses local health departments for the cost of each vaccine administered plus a $22 administrative fee. Over the past 5 years, the commission has spent on average $8,900 per year on this program.


The commission uses firefighter fund revenue to provide $3,200 competitive grants to volunteer and professional fire departments for purchasing thermal vision cameras. In FY 2014, 153 thermal vision grants were awarded for a total of nearly $490,000. Commission auditors check for the thermal vision cameras when they visit the firehouse. Statute mandates that the commission have administrative regulations to govern the grant program, but none exist. Recommendation 3.4 is that the Fire Commission should promulgate administrative regulations to govern the Thermal Vision Grant Program. These regulations should include eligibility requirements, funding levels, reporting requirements, and whether approval of grant applications requires approval of the full commission.


Each year, the commission budgets $500,000 of the firefighter fund to provide training facility grants to volunteer and professional fire departments. Fire departments have one year to complete the projects or to show considerable progress. If this condition is not met, the commission reserves the right to request the funds back. Of the applications received over the past 4 fiscal years, the commission funded 39 for a total of $2.1 million.


The Fire Commission is statutorily required to maintain a uniform standard of physical ability to ensure firefighters are able to do their jobs efficiently and safely. The commission holds a license to administer the eight-event Candidate Physical Ability Test program (CPAT). All new firefighter candidates applying after Jan 1, 2013 must successfully complete CPAT. The Fire Commission also certifies approximately 80 peer fitness instructors who conduct fitness evaluations in fire departments. The commission sometimes has funds available to purchase exercise equipment for fire departments, typically treadmills. If fire commission auditors determine that a treadmill is not being used, the equipment will be transferred to another firehouse that has requested one.


Other expenditures of the firefighter fund include paying worker's compensation premiums for nearly 800 volunteer fire departments. Mobile facilities funds are used to purchase and maintain fleet vehicles and other equipment used by SFRT instructors. The Fire Commission also uses firefighter fund revenue to purchase protective gear for approximately 450 instructors.


The Fire Commission is included in KCTCS's annual audit, which is performed by an outside firm. The audits have had no major findings regarding the commission. Much of the oversight by the Fire Commission comes from reporting requirements and monitoring of the programs it administers. For example, volunteer fire departments receiving state aid must meet yearly training requirements, must submit receipts for any items purchased off a commission-approved list, and must be able to show those items to Fire Commission auditors. Many of the programs require board approval and are monitored for compliance during bimonthly meetings.


In response to questions from Senator Carroll, Mr. Spears clarified that in the case of law enforcement agencies, training stipends are included in overtime rate calculations for scheduled and unscheduled overtime.


In response to a question from Senator McDaniel, Mr. Spears said that a somewhat different calculation method is used by firefighter agencies.


In response to a question from Senator Carroll as to the impact of an increase in stipends on Kentucky’s retirement system, Mr. Hall clarified that the salary figures used in the report are rough estimates used to provide a general idea of the dollar amounts involved.

In response to questions from Senator McDaniel, Mr. Spears said firefighters’ incentive stipends are included when calculating overtime rates for unscheduled overtime. Overtime rate calculations for scheduled overtime do not include incentive stipends.


In response to a question from Representative Palumbo, Mr. Hall clarified that adding eligible EMS providers would cost nearly $25 million annually, but it was an estimate because it was not possible to determine exactly which EMS providers were eligible.


Senator McDaniel noted that the General Assembly must use caution and not expand the uses to which foundation program funds may be used.


A question from Senator McDaniel as to why administrative costs for the firefighter fund doubled in 2013 was referred to the Fire Commission.


Senator Buford noted that in his district, the family of an emergency medical services provider who died did not receive the same benefits that the family of a law enforcement officer or firefighter would have received. He requested a list of counties that do not provide death benefits for emergency medical services personnel.


Secretary Brown noted that for a number of years, all audits of the criminal justice training program have not made any recommendations. He has asked the General Assembly to note that Peace Officer Professional Standards (POPS) certification for officers is a rigorous training standard, much of the law enforcement fund’s revenue is moved to the general fund each year, many POPS-certified officers are not receiving proficiency pay, reserves should be set in the fund before any money is moved into the general fund., and the stipend amount should be increased.


In response to questions from Senator McDaniel, Secretary Brown said when the hours of cadet training is aggregated with in-service training, Kentucky has the most training in the United States. There is no independent audit of the law enforcement fund.


In response to a questions from Senator Carroll, Mr. Bizzack said that training courses have not been eliminated from the program. Some courses have been consolidated as training needs changed. State Police dispatchers are covered through the budget, not the law enforcement fund.


In response to a question from Representative Butler, Secretary Brown said that State Police dispatchers receive the same training as troopers.


Rep. Palumbo extended her thanks to Secretary Brown and Mr. Bizzack for a job well done during their time in the Justice and Public Safety Cabinet.


Upon motion by Senator McDaniel and second by Representative Palumbo, the Kentucky Law Enforcement Foundation Program And Kentucky Firefighter Foundation Program Funds report was adopted by a roll call vote.


Staff Report: Quasi-Governmental Entities In The Kentucky Retirement Systems

Ashleigh Hayes said that quasi-governmental entities (QGE) are not defined in Kentucky statute. The working definition for the report is that QGEs are created by governments to serve public interests but maintain a legally separate status. Board members of QGEs are often appointed by government officials, and government officials may serve on the governing boards. According to the US Census Bureau, special districts are special purpose governments that carry out one or a limited number of functions while maintaining administrative and fiscal autonomy. For the report, special districts are classified as QGEs based on their quasi-independent status and characteristics of their boards.


There are 602 QGEs, divided into 18 classifications in the report, which participate in the Kentucky Retirement Systems (KRS). All the QGEs participate in the Kentucky Employees Retirement System-Nonhazardous (KERS-NH) or County Employees Retirement System-Nonhazardous (CERS-NH) or -Hazardous (CERS-H) retirement plans. The Kentucky Horse Park has nine employees and two retirees in the KERS-Hazardous plan as of FY 2014. For simplicity, these employees and retirees are counted as KERS-NH in the report. Participation in KERS requires approval of the KRS Board and an executive order. Participation in CERS requires approval of the KRS board, followed by an order received from the county fiscal court or a school board. Entities can seek a determination letter from the US Internal Revenue Service to qualify to participate in KRS. The Kentucky League of Cities and Kentucky Association of Counties became participants in this manner.


Chris Riley said that more than 26,000 active QGE members and more than 12,000 QGE retirees participated in the three retirement plans as of FY 2014. QGE active members accounted for 20 percent of the total active members for the three retirement plans. QGE retirees accounted for nearly 13 percent of the total for the three plans. From FY 2007 to FY 2014, the ratios of active members per retiree declined by more than 30 percent for each plan: CERS-NH went from 2.39 to 1.62, CERS-H went from 1.95 to 1.20, and KERS-NH went from 1.42 to 0.98. Trend data for only QGE employees and retirees were unavailable, but as of FY 2014 their employee to retiree ratios were higher for all three plans.


The average age of QGE active members was 44.5, and the average age for QGE retirees was 65.9 in FY 2014. Housing authorities had the highest average active member age at 49.2. Tourist commissions, libraries, and development authorities all had average retiree ages higher than 69. Ambulance services and fire departments had the lowest active member and retiree average ages.


In FY 2014, nearly $238 million in retirement benefits were paid to QGE retirees. The average annual benefit was just more than $19,000. Benefits paid to utility boards, health departments, and regional mental health units accounted for 65 percent of benefits paid to QGE retirees. Average retirement benefits per QGE retiree ranged from just more than $6,000 for conservation districts to more than $30,000 for retirees from airport boards. Overall, QGEs accounted for nearly $2.8 billion in net pension liabilities, which represents nearly 21 percent of net pension liabilities of the three plans. Regional mental health units, health departments, other services, and utility boards each had net pension liabilities of more than $300 million. QGEs in these classifications accounted for nearly 71 percent of total active QGE members, more than 77 percent of QGE retirees, more than 78 percent of QGE retirement benefits, and more than 83 percent of net pension liabilities for QGEs in FY 2014.


Ms. Hayes summarized information on two legal actions involving community mental health centers and KRS. Kentucky River Community Care (KRCC) terminated the employment of more than 400 employees in March 2011 and rehired most of them through an employment agency it created called Go Hire. KRCC claimed that the rehired employees were no longer employed by a participating agency in KRS. KRS filed a declaratory judgment action against KRCC/Go Hire in May 2011. KRCC/Go Hire has been ordered to produce discovery materials. According to KRS, KRCC has not reported active employees or paid any contributions to KRS since FY 2014. KRCC has approximately 139 retirees with service credit earned remaining in KRS.


In April 2013, Seven Counties Services filed for Chapter 11 bankruptcy citing the cost of rising employer contribution rates for participation in KERS-NH. Seven Counties stopped making payments for all but approximately 300 employees and terminated the status of 900 employees. KERS challenged these actions. A bankruptcy court permitted Seven Counties to file Chapter 11 bankruptcy, with KERS being its primary creditor. A financial impact analysis prepared for KERS determined that the lack of contributions by Seven Counties and its employees will increase employer contributions for the remaining employers in KERS-NH by nearly $1 billion over 20 years.


William Thielen said a concern is that it is possible that some entities participating in the retirement systems should not be. A particular concern is nonstock, nonprofit corporations, which includes community mental health agencies. Some state agencies, such as the Personnel Cabinet, contract out many jobs. This results in an erosion of the number of participating members who contribute to the retirement systems.


In response to questions from Senator Carroll, Mr. Thielen said that some agencies find the cost of contributions a heavy burden. Entities that do not participate in KRS can offer another retirement plan to employees. Brian Thomas said that many are not offering KRS as an option.


In response to questions from Senator McDaniel, Mr. Thielen said that when agencies are in bankruptcy, the remaining agencies participating in KRS pick up the liability. Not all agencies classified as quasi-governmental entities are covered by House Bill 62. Mr. Thomas said the employees of the two community mental health services entities involved in litigation for leaving KRS have not been participating in KRS. Seven Counties has not participated since May 2014 and left a $93 million liability. Mr. Thielen said it is a hardship for employees who had already put a lot of service years into KRS.


In response to questions from Representative Simpson, Mr. Thielen said only one additional quasi-governmental entity has been approved for participation in KRS since 2003. Mr. Thomas said that if an agency requests participation, the board determines its eligibility and evaluates the agency’s ability to pay. If approved, the governor issues an executive order. Mr. Thielen said that the board is now reluctant to allow nonstock, nonprofit agencies to participate. Mr. Thomas said the cases involving the two community mental health services agencies are in the discovery process. It is unknown how soon the cases might be resolved.


In response to a question from Senator Carroll, Mr. Thielen said the Affordable Care Act requires insurers to cover dependents aged 22 to 26, but Kentucky statute only allows KRS contributions for insurance for dependents age 21 and younger who are full-time students. The KRS board eventually decided it was not allowed to contribute toward insurance for dependents aged 22 to 26 but that it would be an unfair burden to participants to halt the contributions during the fiscal year. The contributions will end in FY 2016. KRS will then recover amounts totaling $18 million to $27 million per year.


Upon motion by Senator McDaniel and second by Senator Westerfield, the Quasi-Governmental Entities In The Kentucky Retirement Systems report was adopted by a roll call vote.


Senator Carroll announced that the next meeting will be held December 10, 2015, at which time the committee will vote on study topics for 2016. He said that members may send possible topics to staff or the co-chairs before the meeting.


The meeting adjourned at 11:37 AM.