Kentucky Statutes 342.1223 – Kentucky Workers’ Compensation Funding Commission — Commission’s relationship with Office of Financial Management within the Finance and Administration Cabinet
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(1) The Kentucky Workers’ Compensation Funding Commission is created as an agency of the Commonwealth for the public purpose of controlling, investing, and managing the funds collected pursuant to KRS § 342.122.
(2) The commission shall:
(a) Hold, administer, invest, and reinvest the funds collected pursuant to KRS
342.122 and its other funds separate and apart from all “state funds” or
“public funds,” as defined in KRS Chapter 446;
(b) Act as a fiduciary, as defined in KRS Chapter 386, in exercising its power over the funds collected pursuant to KRS § 342.122, and may invest association funds through one (1) or more banks, trust companies, or other financial institutions with offices in Kentucky in good standing with the Department of Financial Institutions, in investments described in KRS Chapter 386, except that the funding commission may, at its discretion, invest in equity securities;
(c) Report to the General Assembly at each even-numbered-year regular session the actuarial soundness and adequacy of the funding mechanism for the special fund and other programs supported by the mechanism, including detailed information on the investment of funds and yields thereon;
(d) Recommend to the General Assembly, not later than October 31 of the year prior to each even-numbered-year regular legislative session, changes deemed necessary in the level of the assessments imposed in this chapter;
(e) In conjunction with the Education and Labor Cabinet, submit to the General Assembly, not later than October 31 of the year prior to each even-numbered-year regular legislative session, a proposed budget for the biennium beginning July 1 following the even-numbered-year regular session of the General Assembly;
(f) In conjunction with the Education and Labor Cabinet, provide to the Interim Joint Committee on Appropriations and Revenue an annual budget and detailed quarterly financial reports;
(g) Conduct periodic audits, independently or in cooperation with the Education and Labor Cabinet or the Department of Revenue, of all entities subject to the assessments imposed in this chapter; and
(h) Report monthly to the Committees on Appropriations and Revenue and on Economic Development and Workforce Investment its monthly expenditures of restricted agency funds and the nature of the expenditures.
(3) The commission shall have all of the powers necessary or convenient to carry out and effectuate the purposes for which it was established, including, but not limited to, the power:
(a) To sue and be sued, complain, or defend, in its name;
(b) To elect, appoint, or hire officers, agents, and employees, and define their duties and fix their compensation within the limits of its budget approved by the General Assembly. Notwithstanding any provision of KRS Chapter
18A to the contrary, officers and employees of the funding commission may be exempted from the classified service;
(c) To contract for investment counseling, legal, actuarial, auditing, and other professional services in accordance with the provisions relating to personal service contracts contained in KRS Chapter 45A;
(d) To appoint, hire, and contract with banks, trust companies, and other entities to serve as depositories and custodians of its investment receipts and other funds;
(e) To take any and all other actions consistent with the purposes of the commission and the provisions of this chapter; and
(f) To make and promulgate administrative regulations.
(4) The Kentucky Workers’ Compensation Funding Commission may utilize the investment expertise and advice of the Office of Financial Management within the Finance and Administration Cabinet. The Kentucky Workers’ Compensation Funding Commission may procure one (1) or more consulting firms and enter into a personal service contract with such consulting firms to provide investment advisory, investment counseling, or investment management services. The Office of Financial Management shall participate in the selection of any firms for investment services provided, however, the Kentucky Workers’ Compensation Funding Commission shall have the right to make the final decision on the selection of any firms. Notwithstanding any provisions of this section to the contrary, all contracts for investment advisory, investment counseling, or investment management services or for the management of assets shall be subject to KRS Chapter 45A. The fees charged by financial institutions for managing the investments of the funds of the funding commission shall be paid from the investment earnings of the funds.
(5) The commission shall be attached to the Education and Labor Cabinet for administrative purposes only.
Effective:July 1, 2022
History: Amended 2022 Ky. Acts ch. 236, sec. 154, effective July 1, 2022. — Amended 2021 Ky. Acts ch. 124, sec. 6, effective June 29, 2021. — Amended
2018 Ky. Acts ch. 54, sec. 4, effective July 14, 2018. — Amended 2017 Ky. Acts ch. 173, sec. 1, effective April 10, 2017. — Amended 2010 Ky. Acts ch. 24, sec.
1788, effective July 15, 2010. — Amended 2005 Ky. Acts ch. 85, sec. 682, effective June 20, 2005. — Amended 2001 Ky. Acts ch. 58, sec. 25, effective June 21, 2001. — Amended 2000 Ky. Acts ch. 46, sec. 29, effective July 14,
2000. — Amended 1996 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 5, effective December 12, 1996. — Amended 1994 Ky. Acts ch. 181, Part. 2, sec. 6, effective April 4, 1994: and ch. 201, sec. 1, effective July 15, 1994. — Amended 1990 Ky. Acts ch. 33, sec. 4, effective July 13, 1990; ch. 321, sec. 11, effective July 13,
1990; and ch. 496, sec. 62, effective July 13, 1990. — Amended 1988 Ky. Acts ch. 437, Pt. II, M, sec. 58, effective April 15, 1988. — Created 1987 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 63, effective October 26, 1987.
(2) The commission shall:
Terms Used In Kentucky Statutes 342.1223
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Biennium: means the two (2) year period commencing on July 1 in each even- numbered year and ending on June 30 in the ensuing even-numbered year. See Kentucky Statutes 446.010
- Compensation: means all payments made under the provisions of this chapter representing the sum of income benefits and medical and related benefits. See Kentucky Statutes 342.0011
- Contract: A legal written agreement that becomes binding when signed.
- Department: means the Department of Workers' Claims in the Education and
Labor Cabinet. See Kentucky Statutes 342.0011 - Fiduciary: A trustee, executor, or administrator.
- Legislative session: That part of a chamber's daily session in which it considers legislative business (bills, resolutions, and actions related thereto).
- Year: means calendar year. See Kentucky Statutes 446.010
(a) Hold, administer, invest, and reinvest the funds collected pursuant to KRS
342.122 and its other funds separate and apart from all “state funds” or
“public funds,” as defined in KRS Chapter 446;
(b) Act as a fiduciary, as defined in KRS Chapter 386, in exercising its power over the funds collected pursuant to KRS § 342.122, and may invest association funds through one (1) or more banks, trust companies, or other financial institutions with offices in Kentucky in good standing with the Department of Financial Institutions, in investments described in KRS Chapter 386, except that the funding commission may, at its discretion, invest in equity securities;
(c) Report to the General Assembly at each even-numbered-year regular session the actuarial soundness and adequacy of the funding mechanism for the special fund and other programs supported by the mechanism, including detailed information on the investment of funds and yields thereon;
(d) Recommend to the General Assembly, not later than October 31 of the year prior to each even-numbered-year regular legislative session, changes deemed necessary in the level of the assessments imposed in this chapter;
(e) In conjunction with the Education and Labor Cabinet, submit to the General Assembly, not later than October 31 of the year prior to each even-numbered-year regular legislative session, a proposed budget for the biennium beginning July 1 following the even-numbered-year regular session of the General Assembly;
(f) In conjunction with the Education and Labor Cabinet, provide to the Interim Joint Committee on Appropriations and Revenue an annual budget and detailed quarterly financial reports;
(g) Conduct periodic audits, independently or in cooperation with the Education and Labor Cabinet or the Department of Revenue, of all entities subject to the assessments imposed in this chapter; and
(h) Report monthly to the Committees on Appropriations and Revenue and on Economic Development and Workforce Investment its monthly expenditures of restricted agency funds and the nature of the expenditures.
(3) The commission shall have all of the powers necessary or convenient to carry out and effectuate the purposes for which it was established, including, but not limited to, the power:
(a) To sue and be sued, complain, or defend, in its name;
(b) To elect, appoint, or hire officers, agents, and employees, and define their duties and fix their compensation within the limits of its budget approved by the General Assembly. Notwithstanding any provision of KRS Chapter
18A to the contrary, officers and employees of the funding commission may be exempted from the classified service;
(c) To contract for investment counseling, legal, actuarial, auditing, and other professional services in accordance with the provisions relating to personal service contracts contained in KRS Chapter 45A;
(d) To appoint, hire, and contract with banks, trust companies, and other entities to serve as depositories and custodians of its investment receipts and other funds;
(e) To take any and all other actions consistent with the purposes of the commission and the provisions of this chapter; and
(f) To make and promulgate administrative regulations.
(4) The Kentucky Workers’ Compensation Funding Commission may utilize the investment expertise and advice of the Office of Financial Management within the Finance and Administration Cabinet. The Kentucky Workers’ Compensation Funding Commission may procure one (1) or more consulting firms and enter into a personal service contract with such consulting firms to provide investment advisory, investment counseling, or investment management services. The Office of Financial Management shall participate in the selection of any firms for investment services provided, however, the Kentucky Workers’ Compensation Funding Commission shall have the right to make the final decision on the selection of any firms. Notwithstanding any provisions of this section to the contrary, all contracts for investment advisory, investment counseling, or investment management services or for the management of assets shall be subject to KRS Chapter 45A. The fees charged by financial institutions for managing the investments of the funds of the funding commission shall be paid from the investment earnings of the funds.
(5) The commission shall be attached to the Education and Labor Cabinet for administrative purposes only.
Effective:July 1, 2022
History: Amended 2022 Ky. Acts ch. 236, sec. 154, effective July 1, 2022. — Amended 2021 Ky. Acts ch. 124, sec. 6, effective June 29, 2021. — Amended
2018 Ky. Acts ch. 54, sec. 4, effective July 14, 2018. — Amended 2017 Ky. Acts ch. 173, sec. 1, effective April 10, 2017. — Amended 2010 Ky. Acts ch. 24, sec.
1788, effective July 15, 2010. — Amended 2005 Ky. Acts ch. 85, sec. 682, effective June 20, 2005. — Amended 2001 Ky. Acts ch. 58, sec. 25, effective June 21, 2001. — Amended 2000 Ky. Acts ch. 46, sec. 29, effective July 14,
2000. — Amended 1996 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 5, effective December 12, 1996. — Amended 1994 Ky. Acts ch. 181, Part. 2, sec. 6, effective April 4, 1994: and ch. 201, sec. 1, effective July 15, 1994. — Amended 1990 Ky. Acts ch. 33, sec. 4, effective July 13, 1990; ch. 321, sec. 11, effective July 13,
1990; and ch. 496, sec. 62, effective July 13, 1990. — Amended 1988 Ky. Acts ch. 437, Pt. II, M, sec. 58, effective April 15, 1988. — Created 1987 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 63, effective October 26, 1987.