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House Co-Sponsorship Memoranda
House of Representatives
Session of 2015 - 2016
Regular Session
MEMORANDUM
| Posted: | March 7, 2016 03:20 PM |
|---|---|
| From: | Representative Rick Saccone |
| To: | All House members |
| Subject: | Reducing State Pension Risk and Liability |
| In the near future, I plan to introduce legislation that will end the option for school and state employees to receive a higher 2.5% benefit accrual for their pension. When this option was created under Act 120 of 2010, it was intended to be actuarially neutral as public employees would contribute more of their salary for the higher benefit. Since that time however, the 8% investment return assumption has been lowered for both SERS and PSERS to 7.5%. Many pension experts and actuaries argue assumed rates of return must go even lower. As a result, the election for higher benefits at Act 120 employee contribution rates is costing taxpayers more in pension liabilities. Phasing out the higher benefit class for new hires is a step in the right direction for reducing taxpayer risk and future unfunded liabilities. Please join me in cosponsoring this legislation. |
Introduced as HB2049