PRINTER'S NO. 1212
No. 973 Session of 2001
INTRODUCED BY LOGAN, ORIE, TARTAGLIONE, COSTA, LAVALLE, MUSTO,
BODACK, WAGNER, D. WHITE, MELLOW, SCHWARTZ, BOSCOLA, BELL,
KASUNIC, STOUT, ERICKSON, KUKOVICH AND O'PAKE, JUNE 15, 2001
REFERRED TO RULES AND EXECUTIVE NOMINATIONS, JUNE 15, 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
16 annuity, adjusted for full coverage in the case of a joint
17 coverage member who makes the appropriate back contributions for
18 full coverage, shall be frozen as of the date such annuity
1 ceases. An annuitant who is credited with an additional 10% of
2 membership service as provided in section 8302(b.2) (relating to
3 credited school service) and who returns to school service,
4 except as provided in subsection (b), shall forfeit such
5 credited service and shall have his frozen present value
6 adjusted as if his 10% retirement incentive had not been applied
7 to his account. In the event that [the] a cost-of-living
8 increase [enacted December 18, 1979,] occurred during the period
9 of such State or school employment, the frozen present value
10 shall be increased, on or after the member attains
11 superannuation age, by the percent applicable had he not
12 returned to service.
13 * * *
14 Section 2. Section 8348(a) and (b) of Title 24 are amended
15 to read:
16 § 8348. Supplemental annuities.
17 (a) General rule.--Every annuitant who is in receipt of a
18 superannuation, withdrawal or disability annuity, shall continue
19 to receive such annuity [and beginning July 1, 1979, any
20 annuitant who retired on or prior to July 1, 1978, shall receive
21 a cost-of-living supplement determined as a percentage applied
22 to the retirement annuity as of June 30, 1979. Such cost-of-
23 living supplement shall be payable under the same terms and
24 conditions as provided under the option plan in effect as of
25 June 30, 1979.], and beginning January 1, 2001, and annually
26 thereafter, a cost-of-living supplement shall be payable to each
27 annuitant whose annuity has been in effect for at least 24
28 consecutive months. Any cost-of-living supplement provided in
29 this subsection shall be payable under the same terms and
30 conditions as provided under the option plan in effect as of
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1 December 31 of the year preceding the adjustment. The minimum
2 annual cost-of-living increase shall be 3% or such higher
3 percentage or such lower percentage as the board shall determine
4 based on an actual determination of the fiscal impact of the
5 cost-of-living adjustment on the fund. The board shall only
6 lower the percentage of the annual cost-of-living increase when
7 the actuarial determination shows that the fiscal impact of such
8 cost-of-living adjustment places the fund in an unsafe financial
9 position. No cost-of-living supplement shall be payable to an
10 annuitant receiving a withdrawal annuity prior to his attainment
11 of superannuation age.
12 [(b) Cost-of-living adjustment factors.--The percentage
13 which is to be applied in the determination of the cost-of-
14 living supplements shall be determined on the basis of the
15 effective date of retirement payable on the first $12,000 of
16 annuity received per year. The applicable percentage factors
17 are:
18 Effective date of retirement Percentage factor
19 After July 1, 1977 through July 1, 1978 5%
20 After July 1, 1976 through July 1, 1977 10%
21 After July 1, 1975 through July 1, 1976 13%
22 After July 1, 1974 through July 1, 1975 20%
23 After July 1, 1973 through July 1, 1974 27%
24 On or prior to July 1, 1973 31%]
25 * * *
26 Section 3. Section 8348.1 of Title 24 is repealed.
27 Section 4. Section 5706(a) of Title 71, amended May 17, 2001
28 (P.L.26, No.9), is amended to read:
29 § 5706. Termination of annuities.
30 (a) General rule.--If the annuitant returns to State service
20010S0973B1212 - 3 -
1 or enters or has entered school service and elects multiple
2 service membership, any annuity payable to him under this part
3 shall cease effective upon the date of his return to State
4 service or entering school service and in the case of an annuity
5 other than a disability annuity the present value of such
6 annuity, adjusted for full coverage in the case of a joint
7 coverage member who makes the appropriate back contributions for
8 full coverage, shall be frozen as of the date such annuity
9 ceases. An annuitant who is credited with an additional 10% of
10 Class A and Class C service as provided in section 5302(c)
11 (relating to credited State service) and who returns to State
12 service shall forfeit such credited service and shall have his
13 frozen present value adjusted as if his 10% retirement incentive
14 had not been applied to his account. In the event that [the] a
15 cost-of-living increase [enacted December 18, 1979] occurred
16 during the period of such State or school employment, the frozen
17 present value shall be increased, on or after the member attains
18 superannuation age, by the percent applicable had he not
19 returned to service. This subsection shall not apply in the case
20 of any annuitant who may render services to the Commonwealth in
21 the capacity of an independent contractor or as a member of an
22 independent board or commission or as a member of a departmental
23 administrative or advisory board or commission when such members
24 of independent or departmental boards or commissions are
25 compensated on a per diem basis for not more than 150 days per
26 calendar year or as a member of an independent board or
27 commission requiring appointment by the Governor, with advice
28 and consent of the Senate, where the annual salary payable to
29 the member does not exceed $35,000 and where the member has been
30 an annuitant for at least six months immediately preceding the
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1 appointment. Such service shall not be subject to member
2 contributions or be eligible for qualification as creditable
3 State service.
4 * * *
5 Section 5. Section 5708(a) and (b) of Title 71 are amended
6 to read:
7 § 5708. Supplemental annuities.
8 (a) General rule.--Every annuitant [who retired prior to
9 July 1, 1978 and] who is in receipt of a superannuation,
10 withdrawal or disability annuity, shall continue to receive the
11 annuity [to which he was entitled prior to July 1, 1979 and
12 beginning July 1, 1979, any annuitant retiring on or prior to
13 June 30, 1978 shall receive a cost-of-living supplement
14 determined as a percentage applied to the retirement annuity to
15 which he was entitled prior to July 1, 1979. Such cost-of-living
16 supplement shall be payable under the same terms and conditions
17 as provided under the option plan in effect as of June 30,
18 1979.], and beginning January 1, 2001, and annually thereafter,
19 a cost-of-living supplement shall be payable to each annuitant
20 whose annuity has been in effect for at least 24 consecutive
21 months. Any cost-of-living supplement provided in this
22 subsection shall be payable under the same terms and conditions
23 as provided under the option plan in effect as of December 31 of
24 the year preceding the adjustment. The minimum annual cost-of-
25 living increase shall be 3% or such higher percentage or such
26 lower percentage as the board shall determine based on an actual
27 determination of the fiscal impact of the cost-of-living
28 adjustment on the fund. The board shall only lower the
29 percentage of the annual cost-of-living increase when the
30 actuarial determination shows that the fiscal impact of such
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1 cost-of-living adjustment places the fund in an unsafe financial
2 position. No cost-of-living supplement shall be payable to an
3 annuitant receiving a withdrawal annuity prior to his attainment
4 of superannuation age.
5 [(b) Cost-of-living adjustment factors.--The percentage
6 which is to be applied in the determination of the cost-of-
7 living supplements, shall be determined on the basis of the
8 effective date of retirement payable on the first $12,000 of
9 annuity received per year, as follows:
10 Effective date of retirement Percentage factor
11 July 1, 1977 through June 30, 1978 5%
12 July 1, 1976 through June 30, 1977 10%
13 July 1, 1975 through June 30, 1976 13%
14 July 1, 1974 through June 30, 1975 20%
15 March 1, 1974 through June 30, 1974 27%
16 Prior to March 1, 1974 31%
17 Provided, however, That such cost-of-living supplement as
18 determined above shall not be payable to an annuitant receiving
19 a withdrawal annuity prior to the first day of July coincident
20 with or following his attainment of superannuation age: And
21 further provided, That any member terminating legislative
22 service subsequent to November 30, 1970, shall be entitled to
23 receive on account of Class D-3 service a maximum single life
24 annuity per year of service as a regular member of the General
25 Assembly which shall not be less than the corresponding maximum
26 single life annuity, including any cost-of-living supplements
27 enacted prior to October 1, 1979, of a member retiring from
28 legislative service November 30, 1970.]
29 * * *
30 Section 6. Section 5708.1 of Title 71 is repealed.
20010S0973B1212 - 6 -
1 Section 7. This act shall be retroactive to January 1, 2001.
2 Section 8. This act shall take effect immediately.
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