Updated October 30, 2026. Quick answer: Kentucky KERS retirees get a COLA only if the Kentucky General Assembly grants one: it alone holds the authority. The last retiree COLA, a 1.5% ongoing increase, took effect in July 2011. A 2027 COLA is not set yet, and KPPA says the surplus route to a COLA does not currently apply to any system.
More on public pension retirement ages and eligibility: the Kentucky KERS and CERS retirement age and eligibility rules by tier.
Who can grant a KERS COLA
The Kentucky Public Pensions Authority (KPPA) COLA page for KERS says: “the Kentucky General Assembly (and not the KPPA Board or the Governor) actually holds the authority to grant COLAs under Kentucky Revised Statute (KRS) 61.691 and KRS 78.5518”. Its KERS, CERS and SPRS Summary Plan Description words it a little differently: “the Kentucky General Assembly (and not the CERS or KRS Boards, the KPPA, or the Governor) actually holds the authority to grant COLAs under Kentucky Revised Statutes 61.691 and 78.5518.”
When a COLA is allowed
Since the 2013 Regular Session, KPPA says a COLA is granted only if one of two conditions is met. “Scenario 1: The respective boards of Trustees determine that assets of the system are greater than 100% of the actuarial liabilities and legislation authorizes the use of surplus funds for the COLA; or”. “Scenario 2: The General Assembly fully pre-funds the COLA or directs the payment of funds in the year the COLA is provided.” On the first route KPPA says: “The first scenario for granting retiree COLAs does not currently apply to any system.”
The last increase
KPPA states: “The last retiree Cost of Living Adjustment (COLA), or an ongoing retirement payment increase of 1.5% to account for cost-of-living changes, took effect in July 2011.” The sources do not name the act that set it or give a vote date.
Who is left out
This page covers KERS retirees. CERS is a separate Kentucky system, and KPPA notes that it is possible that retired members of one system may receive a COLA while another would not. The Tier 3 guide read mentions a COLA only on the insurance contribution, so it does not establish a benefit COLA for Cash Balance Plan members either way.
Where 2027 stands
No 2027 KERS COLA is set yet: only the Kentucky General Assembly can authorize one, and this page updates when KPPA publishes it. The KPPA pages read announce no 2027 COLA, and KPPA lists no schedule for one. If you are planning retirement income, treat your KERS benefit as flat in dollars unless the General Assembly acts, and check the KPPA COLA page for any change.
Common mistakes
- Expecting a yearly KERS COLA. KPPA says the General Assembly, not the KPPA Board or the Governor, holds the authority to grant one.
- Counting on the surplus route. KPPA says the first scenario does not currently apply to any system.
- Mixing up the retirement COLA with the insurance increase. The Tier 3 guide describes a 1.5% annual increase to the monthly insurance benefit, which is a different benefit.
Related: Kentucky KERS retirement decisions, how public pension decisions work, and whether Kentucky taxes pensions.
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Answer againSources
- Kentucky Public Pensions Authority, KPPA Cost of Living Adjustments (COLAs) page: www.kyret.ky.gov
- Kentucky Public Pensions Authority, Summary Plan Description (KERS, CERS, SPRS): kyret.ky.gov
- Related official page (not quoted): IRS Tax Topic 410, Pensions and annuities: www.irs.gov
- Related official page (not quoted): IRS Tax Topic 411, Pensions: the General Rule and the Simplified Method: www.irs.gov
Read from the primary documents linked above on October 30, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the IRS itself is the right place to confirm anything consequential.