KENTUCKY STATE UNIVERSITY
NOTES TO FINANCIAL STATEMENTS
June 30, 2017
Sensitivity of the University's proportionate share of the net pension liability to changes in the discount rate - The University's proportionate share of the net pension liability has been calculated using a discount rate of 6.75% (Non-Hazardous) for the June 30, 2016 actuarial valuation. The following presents the University's proportionate share of the net pension liability (in thousands) calculated using a discount rate 1% higher and 1% lower than the current rate as of June 30, 2017:
| 1% Decrease (5.75%) | Current Discount Rate (6.75%) | 1% Increase (7.75%) |
|---|
| Non-Hazardous Proportionate share of the Collective Net Pension Liability | $ 32,835,265 | $ 29,146,180 | $ 26,045,846 |
Plan Description – The Kentucky Teachers’ Retirement System (KTRS), a cost sharing - multiple employer public employee retirement system. KTRS is a defined benefit plan providing for retirement, disability, death benefits and health insurance. Participants have a fully vested interest after the completion of 60 months of service, 12 of which are current service. KTRS issues a publicly available financial report that includes financial statements, required supplementary information, and detailed information about the pension plan's fiduciary net position. That report may be obtained by writing to Kentucky Teachers' Retirement System, 479 Versailles Road, Frankfort, Kentucky, 40601 or by calling (502) 573-3266.
| Tier 1
Participation Prior to
July 1, 2008 | Tier 2
Participation on or After
July 1, 2008 |
|---|
| Covered Employees: | University faculty and professional staff that do not choose the Optional Retirement Plan (Deferred Contribution) | University faculty and professional staff that do not choose the Optional Retirement Plan (Deferred Contribution) |
|---|
| Benefit Formula: | Final Compensation X Benefit Factor X Years of Service |
|---|
| Final Compensation: | Average of the highest 5 annual salaries reduced 5% per year from the earlier of age 60 or the date 27 years of service would have been completed. Average of the highest 3 annual salaries if age 55 with 27 or more years of service. The minimum annual service allowance for all members is $440 multiplied by credited service. | Average of the highest 5 annual salaries reduced 6% per year from the earlier of age 60 or the date 27 years of service would have been completed. Average of the highest 3 annual salaries if age 55 with 27 or more years of service. The minimum annual service allowance for all members is $440 multiplied by credited |
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