| |
|
| |
| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
| |
| SENATE BILL |
|
| |
| |
| INTRODUCED BY KITCHEN, COSTA, MELLOW, WASHINGTON, WILLIAMS, HUGHES, FARNESE AND TARTAGLIONE, JULY 31, 2009 |
| |
| |
| REFERRED TO FINANCE, JULY 31, 2009 |
| |
| |
| |
| AN ACT |
| |
1 | Amending the act of December 18, 1984 (P.L.1005, No.205), |
2 | entitled "An act mandating actuarial funding standards for |
3 | all municipal pension systems; establishing a recovery |
4 | program for municipal pension systems determined to be |
5 | financially distressed; providing for the distribution of the |
6 | tax on the premiums of foreign fire insurance companies; and |
7 | making repeals," adding special provisions for amortization |
8 | of unfunded actuarial accrued liability and minimum municipal |
9 | obligation in cities of the first class; and providing for |
10 | special taxing authority for cities of the first class. |
11 | The General Assembly of the Commonwealth of Pennsylvania |
12 | hereby enacts as follows: |
13 | Section 1. Chapter 10 heading of the act of December 18, |
14 | 1984 (P.L.1005, No.205), known as the Municipal Pension Plan |
15 | Funding Standard and Recovery Act, added June 18, 1998 (P.L.626, |
16 | No.82), is amended to read: |
17 | CHAPTER 10 |
18 | [ALTERNATIVE FUNDING MECHANISM] |
19 | PROVISIONS RELATING TO CITIES OF THE FIRST CLASS |
20 | Section 2. Section 1001(b) of the act, added June 18, 1998 |
21 | (P.L.626, No.82), is amended and the section is amended by |
22 | adding a subsection to read: |
|
1 | Section 1001. Alternative funding mechanism. |
2 | * * * |
3 | (b) Period of payment requirements prior to July 1, 2009.-- |
4 | The period of the city's payment requirements under an |
5 | alternative funding mechanism implemented prior to December 31, |
6 | 2002, shall be the greater of: |
7 | (1) the remaining period not exceeding 30 years during |
8 | which the city would have amortized the unfunded actuarial |
9 | accrued liability reported in its last actuarial valuation |
10 | report filed under Chapter 2 using the total amortization |
11 | payment and interest assumption, reported in that actuarial |
12 | valuation report; or |
13 | (2) 30 years. |
14 | If an alternative funding mechanism is implemented after |
15 | December 31, 2002, but before July 1, 2009, the period described |
16 | in paragraph (1) shall be the period of the city's payment |
17 | requirements. |
18 | (b.1) Period of payment requirements beginning July 1, |
19 | 2009.--The period of the city's payment requirements under an |
20 | alternative funding mechanism implemented or refinanced in whole |
21 | or in part on or after July 1, 2009, and prior to the beginning |
22 | of the plan year that commences in 2019, shall be the greater |
23 | of: |
24 | (1) the remaining period not exceeding 30 years during |
25 | which the city would have amortized the unfunded actuarial |
26 | accrued liability reported in its last actuarial valuation |
27 | report filed under Chapter 2 using the total amortization |
28 | payment and interest assumption, reported in that actuarial |
29 | valuation report; or |
30 | (2) 30 years. |
|
1 | If an alternative funding mechanism is implemented after July 1, |
2 | 2019, the period described in paragraph (1) shall be the period |
3 | of the city's payment requirements. |
4 | * * * |
5 | Section 3. The act is amended by adding sections to read: |
6 | Section 1002. Special provisions for amortization of unfunded |
7 | actuarial accrued liability and minimum municipal |
8 | obligation. |
9 | (a) Amortization of unfunded actuarial accrued liability.-- |
10 | (1) Notwithstanding any other provision of this act or |
11 | other law, a city of the first class, in its sole discretion, |
12 | may amortize its entire unfunded actuarial accrued liability, |
13 | as measured on a valuation date selected by the city of the |
14 | first class and occurring in the plan year commencing after |
15 | January 1, 2009, and ending before December 31, 2010, as a |
16 | level dollar amount with the amortization target date being |
17 | the end of the plan year occurring 30 years after the plan |
18 | year commencing on July 1, 2009, with payments to commence in |
19 | the next plan year. |
20 | (2) In order for a city of the first class to extend the |
21 | applicable amortization period pursuant to this subsection, |
22 | the city of the first class must file a revised actuarial |
23 | valuation report reflecting the amortization period extension |
24 | provided for under this section and the actuarial assumed |
25 | rate in effect on the valuation date with the commission not |
26 | later than March 31, 2010. |
27 | (3) Any such revised actuarial valuation report may not |
28 | be filed in lieu of the actuarial valuation report prepared |
29 | in compliance with section 202(b)(4)(v)(A) and required to be |
30 | filed on or before March 31, 2009, and may be used only for |
|
1 | the purposes of recalculating the minimum municipal |
2 | obligation of the city of the first class for the plan year |
3 | commencing on July 1, 2009, and calculating the minimum |
4 | municipal obligation of the city of the first class for the |
5 | plan year commencing on July 1, 2010, to reflect the |
6 | amortization period extension. The revised report shall |
7 | supersede the original report to the extent of the revisions. |
8 | (4) Any such revised actuarial valuation report shall |
9 | not affect distributions under the General Municipal Pension |
10 | System State Aid Program under Chapter 4. |
11 | (b) Revised minimum municipal obligation for certain plan |
12 | years.-- |
13 | (1) Notwithstanding any other provision of this act or |
14 | other law, a city of the first class is authorized to defer a |
15 | portion of the minimum municipal obligation provided for in |
16 | section 302: |
17 | (i) for the plan year ending June 30, 2010, in an |
18 | amount not to exceed $155,000,000; and |
19 | (ii) for the plan year ending June 30, 2011, in an |
20 | amount not to exceed $80,000,000. |
21 | (2) The amounts deferred shall bear interest at the rate |
22 | of 8.25%, which shall be calculated from the beginning of the |
23 | plan year in which the deferral was made. Accrued interest on |
24 | any amounts deferred shall be paid yearly on or before June |
25 | 30, 2010, June 30, 2011 and June 30, 2012. |
26 | (3) On or before June 30, 2013, the city of the first |
27 | class shall repay: |
28 | (i) at least $90,000,000 of any amounts deferred, |
29 | plus interest accrued on all amounts deferred; or |
30 | (ii) if the total amount deferred is less than |
|
1 | $90,000,000, the total amount deferred, plus interest |
2 | accrued on that amount. |
3 | (4) The balance of all amounts deferred, including |
4 | interest accrued and unpaid on amounts deferred, shall be |
5 | repaid by June 30, 2014. |
6 | (5) Any of the amounts deferred, including interest |
7 | accrued on deferred amounts, which remain unpaid at the end |
8 | of the plan year ending June 30, 2014, shall be added to the |
9 | minimum municipal obligation of the city of the first class |
10 | for the following plan year, with interest calculated and due |
11 | until the date that the amounts due are paid. |
12 | (6) The calculation of the unfunded actuarial accrued |
13 | liability made by and certified by an approved actuary under |
14 | section 202 shall not include any amounts deferred pursuant |
15 | to this subsection, so long as the city of the first class is |
16 | paying interest accrued on such deferred amounts and repaying |
17 | such deferred amounts in accordance with the terms of this |
18 | subsection. |
19 | (7) The repayment of any amounts deferred, including |
20 | interest accrued on deferred amounts, as and when required in |
21 | this subsection, shall constitute a commitment and |
22 | obligation, binding and absolute, on the city of the first |
23 | class; and the city of the first class shall include all |
24 | amounts due to be paid under this subsection in the budget of |
25 | the city, and all amounts due to be paid shall be |
26 | appropriated and paid in order to make timely repayment of |
27 | any amounts deferred, including interest accrued on deferred |
28 | amounts, with such payment being unconditional and without |
29 | setoff. |
30 | (8) (i) Any person who is beneficially interested in |
|
1 | the city of the first class paying its minimum municipal |
2 | obligation under this subsection shall have standing to |
3 | institute a legal proceeding for mandamus to enforce the |
4 | obligation of the city of the first class to make |
5 | payments under this subsection in the same manner as |
6 | payment requirements of an alternative funding mechanism |
7 | may be enforced under section 1001. |
8 | (ii) For purposes of this paragraph, a person is |
9 | beneficially interested under this subsection if the |
10 | person is a beneficially interested person under section |
11 | 1001(f). |
12 | (9) The city of the first class shall be required to pay |
13 | the balance of its minimum municipal obligation in full when |
14 | due in each plan year. |
15 | Section 1003. Special taxing authority. |
16 | (a) Imposition of special tax.-- |
17 | (1) Solely for the purposes set forth in subsection (c), |
18 | a city of the first class is authorized to impose a tax on |
19 | the sale at retail of tangible personal property or services |
20 | or use of tangible personal property or services purchased at |
21 | retail, as those terms are defined in Article II of the act |
22 | of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code |
23 | of 1971, which tax shall be in addition to the tax authorized |
24 | under the provisions of section 503(a) and (b) of the act of |
25 | June 5, 1991 (P.L.9, No.6), known as the Pennsylvania |
26 | Intergovernmental Cooperation Authority Act for Cities of the |
27 | First Class. The tax authorized by this subsection shall not |
28 | be levied, assessed and collected upon the occupancy of a |
29 | room or rooms in a hotel in the city. |
30 | (2) The tax authorized under this subsection shall be |
|
1 | imposed and collected at the rate of 1%, and shall be |
2 | computed as set forth in section 503(e)(3) of the |
3 | Pennsylvania Intergovernmental cooperation Authority Act for |
4 | Cities of the First Class. |
5 | (3) The tax authorized under this subsection shall be |
6 | administered, collected, deposited and disbursed in the same |
7 | manner as the tax imposed under Chapter 5 of the Pennsylvania |
8 | Intergovernmental Cooperation Authority Act for Cities of the |
9 | First Class and the situs of the tax authorized under this |
10 | subsection shall be determined in accordance with that act |
11 | and Article II-A of the Tax Reform Code of 1971. The |
12 | department shall use the money received by the department to |
13 | cover its costs of administration of the tax authorized by |
14 | the provisions of Chapter 5 of the Pennsylvania |
15 | Intergovernmental Cooperation Authority Act for Cities of the |
16 | First Class to cover the costs of administration of the tax |
17 | authorized by this section; and the department shall not |
18 | retail any additional amounts for the costs of collection of |
19 | the tax authorized by this section. No additional fee shall |
20 | be charged for either a license or any renewal in addition to |
21 | a license or renewal fee otherwise authorized and imposed |
22 | pursuant to Article II of the Tax Reform Code of 1971. |
23 | (b) Municipal action.-- |
24 | (1) If a city determines to impose the tax authorized by |
25 | subsection (a), the governing body of the city shall adopt or |
26 | shall previously have adopted an ordinance which shall state |
27 | the tax rate. |
28 | (2) The city ordinance, including an ordinance adopted |
29 | prior to the effective date of this article, may take effect |
30 | no earlier than 20 days after the adoption of the ordinance |
|
1 | or 20 days after the effective date of this section, |
2 | whichever is later. |
3 | (3) A certified copy of a city ordinance imposing the |
4 | tax authorized by subsection (a) shall be delivered to the |
5 | department within ten days prior to or after the effective |
6 | date of that ordinance. |
7 | (4) A certified copy of a repeal ordinance shall be |
8 | delivered to the department at least 30 days prior to the |
9 | effective date of the repeal. |
10 | (c) Use of tax receipts.--Any moneys received by the city |
11 | from the levy, assessment and collection of the tax authorized |
12 | under subsection (a) may only be used to: |
13 | (1) pay as and when due in any plan year any amounts of |
14 | the city's minimum municipal obligation provided for in |
15 | section 302, including, but not limited to, amounts deferred |
16 | pursuant to section 1002(b) and interest accrued on deferred |
17 | amounts; and |
18 | (2) reimburse the city for payments made by the city, |
19 | from sources other than the tax authorized in subsection (a), |
20 | of the city's minimum municipal obligation for that year, |
21 | including, but not limited to, amounts deferred pursuant to |
22 | section 1002(b) and interest accrued on deferred amounts. |
23 | (d) Expiration.-- |
24 | (1) This section shall expire July 1, 2014. |
25 | (2) Notwithstanding the expiration of this section, any |
26 | tax imposed pursuant to subsection (a) on sales or use |
27 | occurring before July 1, 2014, shall be paid to and received |
28 | by the department and, along with interest and penalties, |
29 | less any refunds and credits paid, shall be credited to the |
30 | Local Sales and Use Tax Fund created pursuant to the |
|
1 | Pennsylvania Intergovernmental Cooperation Authority Act for |
2 | Cities of the First Class as if this section had not expired. |
3 | Such moneys shall be disbursed to the city imposing the tax |
4 | in the manner provided by section 509 of the Pennsylvania |
5 | Intergovernmental Cooperation Authority Act for Cities of the |
6 | First Class. |
7 | (e) Effect of imposition, expiration or repeal of tax.--The |
8 | imposition, termination or repeal of the tax authorized under |
9 | subsection (a) shall not affect in any way the amount of |
10 | supplemental State assistance allocable to the city imposing the |
11 | tax. |
12 | Section 1004. Additional assistance. |
13 | Notwithstanding any other provision of this act or other law, |
14 | a city of the first class shall continue to receive State |
15 | supplemental assistance and any other assistance available under |
16 | this act. |
17 | Section 4. This act shall take effect immediately. |
|