PRINTER'S NO. 2436
No. 1874 Session of 2001
INTRODUCED BY HARHAI, MANDERINO, MANN, ARMSTRONG, BELARDI,
CASORIO, BEBKO-JONES, M. COHEN, MARKOSEK, SHANER, TRAVAGLIO,
T. STEVENSON, CALTAGIRONE, SOLOBAY, HESS, MUNDY, READSHAW,
SCHRODER, COSTA, GRUCELA, COY, TRICH, SCRIMENTI, CREIGHTON,
SATHER, YEWCIC, DeLUCA, TIGUE, SURRA, FAIRCHILD, YUDICHAK,
GEORGE, CORNELL, LESCOVITZ, WANSACZ, STABACK, BELFANTI,
PETRARCA, JAMES, FRANKEL, McILHINNEY, HUTCHINSON, HANNA,
WILT, LUCYK, CORRIGAN, PALLONE AND BISHOP, AUGUST 1, 2001
REFERRED TO COMMITTEE ON STATE GOVERNMENT, AUGUST 1, 2001
AN ACT
1 Amending Titles 24 (Education) and 71 (State Government) of the
2 Pennsylvania Consolidated Statutes, further providing for
3 cost-of-living increases to annuitants.
4 The General Assembly of the Commonwealth of Pennsylvania
5 hereby enacts as follows:
6 Section 1. Section 8346(a) of Title 24 of the Pennsylvania
7 Consolidated Statutes, amended May 17, 2001 (P.L.26, No. 9), is
8 amended to read:
9 § 8346. Termination of annuities.
10 (a) General rule.--If an annuitant returns to school service
11 or enters or has entered State service and elects multiple
12 service membership, any annuity payable to him under this part
13 shall cease effective upon the date of his return to school
14 service or entering State service and in the case of an annuity
15 other than a disability annuity the present value of such
1 annuity, adjusted for full coverage in the case of a joint
2 coverage member who makes the appropriate back contributions for
3 full coverage, shall be frozen as of the date such annuity
4 ceases. An annuitant who is credited with an additional 10% of
5 membership service as provided in section 8302(b.2) (relating to
6 credited school service) and who returns to school service,
7 except as provided in subsection (b), shall forfeit such
8 credited service and shall have his frozen present value
9 adjusted as if his 10% retirement incentive had not been applied
10 to his account. In the event that [the] a cost-of-living
11 increase [enacted December 18, 1979,] occurred during the period
12 of such State or school employment, the frozen present value
13 shall be increased, on or after the member attains
14 superannuation age, by the percent applicable had he not
15 returned to service.
16 * * *
17 Section 2. Section 8348(a) and (b) of Title 24 are amended
18 to read:
19 § 8348. Supplemental annuities.
20 (a) General rule.--Every annuitant who is in receipt of a
21 superannuation, withdrawal or disability annuity, shall continue
22 to receive such annuity [and beginning July 1, 1979, any
23 annuitant who retired on or prior to July 1, 1978, shall receive
24 a cost-of-living supplement determined as a percentage applied
25 to the retirement annuity as of June 30, 1979. Such cost-of-
26 living supplement shall be payable under the same terms and
27 conditions as provided under the option plan in effect as of
28 June 30, 1979.], and beginning January 1, 2001, and annually
29 thereafter, a cost-of-living supplement shall be payable to each
30 annuitant whose annuity has been in effect for at least 24
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1 consecutive months. Any cost-of-living supplement provided in
2 this subsection shall be payable under the same terms and
3 conditions as provided under the option plan in effect as of
4 December 31 of the year preceding the adjustment. The annual
5 cost-of-living increase shall be 3% unless the board determines
6 that the increase would cause the fund to no longer be fully
7 funded or would prevent the fund from becoming fully funded. No
8 cost-of-living supplement shall be payable to an annuitant
9 receiving a withdrawal annuity prior to his attainment of
10 superannuation age.
11 [(b) Cost-of-living adjustment factors.--The percentage
12 which is to be applied in the determination of the cost-of-
13 living supplements shall be determined on the basis of the
14 effective date of retirement payable on the first $12,000 of
15 annuity received per year. The applicable percentage factors
16 are:
17 Effective date of retirement Percentage factor
18 After July 1, 1977 through July 1, 1978 5%
19 After July 1, 1976 through July 1, 1977 10%
20 After July 1, 1975 through July 1, 1976 13%
21 After July 1, 1974 through July 1, 1975 20%
22 After July 1, 1973 through July 1, 1974 27%
23 On or prior to July 1, 1973 31%]
24 Section 3. Section 8348.1 of Title 24 is repealed.
25 Section 4. Section 5706(a) of Title 71, amended May 17, 2001
26 (P.L.26, No.9), is amended to read:
27 § 5706. Termination of annuities.
28 (a) General rule.--If the annuitant returns to State service
29 or enters or has entered school service and elects multiple
30 service membership, any annuity payable to him under this part
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1 shall cease effective upon the date of his return to State
2 service or entering school service and in the case of an annuity
3 other than a disability annuity the present value of such
4 annuity, adjusted for full coverage in the case of a joint
5 coverage member who makes the appropriate back contributions for
6 full coverage, shall be frozen as of the date such annuity
7 ceases. An annuitant who is credited with an additional 10% of
8 Class A and Class C service as provided in section 5302(c)
9 (relating to credited State service) and who returns to State
10 service shall forfeit such credited service and shall have his
11 frozen present value adjusted as if his 10% retirement incentive
12 had not been applied to his account. In the event that [the] a
13 cost-of-living increase [enacted December 18, 1979] occurred
14 during the period of such State or school employment, the frozen
15 present value shall be increased, on or after the member attains
16 superannuation age, by the percent applicable had he not
17 returned to service. This subsection shall not apply in the case
18 of any annuitant who may render services to the Commonwealth in
19 the capacity of an independent contractor or as a member of an
20 independent board or commission or as a member of a departmental
21 administrative or advisory board or commission when such members
22 of independent or departmental boards or commissions are
23 compensated on a per diem basis for not more than 150 days per
24 calendar year or as a member of an independent board or
25 commission requiring appointment by the Governor, with advice
26 and consent of the Senate, where the annual salary payable to
27 the member does not exceed $35,000 and where the member has been
28 an annuitant for at least six months immediately preceding the
29 appointment. Such service shall not be subject to member
30 contributions or be eligible for qualification as creditable
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1 State service.
2 * * *
3 Section 5. Section 5708(a) and (b) of Title 71 are amended
4 to read:
5 § 5708. Supplemental annuities.
6 (a) General rule.--Every annuitant [who retired prior to
7 July 1, 1978 and] who is in receipt of a superannuation,
8 withdrawal or disability annuity, shall continue to receive the
9 annuity [to which he was entitled prior to July 1, 1979 and
10 beginning July 1, 1979, any annuitant retiring on or prior to
11 June 30, 1978 shall receive a cost-of-living supplement
12 determined as a percentage applied to the retirement annuity to
13 which he was entitled prior to July 1, 1979. Such cost-of-living
14 supplement shall be payable under the same terms and conditions
15 as provided under the option plan in effect as of June 30,
16 1979.], and beginning January 1, 2001, and annually thereafter,
17 a cost-of-living supplement shall be payable to each annuitant
18 whose annuity has been in effect for at least 24 consecutive
19 months. Any cost-of-living supplement provided in this
20 subsection shall be payable under the same terms and conditions
21 as provided under the option plan in effect as of December 31 of
22 the year preceding the adjustment. The annual cost-of-living
23 increase shall be 3% unless the board determines that the
24 increase would cause the fund to no longer be fully funded or
25 would prevent the fund from becoming fully funded. No cost-of-
26 living supplement shall be payable to an annuitant receiving a
27 withdrawal annuity prior to his attainment of superannuation
28 age.
29 [(b) Cost-of-living adjustment factors.--The percentage
30 which is to be applied in the determination of the cost-of-
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1 living supplements, shall be determined on the basis of the
2 effective date of retirement payable on the first $12,000 of
3 annuity received per year, as follows:
4 Effective date of retirement Percentage factor
5 July 1, 1977 through June 30, 1978 5%
6 July 1, 1976 through June 30, 1977 10%
7 July 1, 1975 through June 30, 1976 13%
8 July 1, 1974 through June 30, 1975 20%
9 March 1, 1974 through June 30, 1974 27%
10 Prior to March 1, 1974 31%
11 Provided, however, That such cost-of-living supplement as
12 determined above shall not be payable to an annuitant receiving
13 a withdrawal annuity prior to the first day of July coincident
14 with or following his attainment of superannuation age: And
15 further provided, That any member terminating legislative
16 service subsequent to November 30, 1970, shall be entitled to
17 receive on account of Class D-3 service a maximum single life
18 annuity per year of service as a regular member of the General
19 Assembly which shall not be less than the corresponding maximum
20 single life annuity, including any cost-of-living supplements
21 enacted prior to October 1, 1979, of a member retiring from
22 legislative service November 30, 1970.]
23 * * *
24 Section 6. Section 5708.1 of Title 71 is repealed.
25 Section 7. This act shall be retroactive to January 1, 2001.
26 Section 8. This act shall take effect immediately.
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