PRINTER'S NO. 3770
No. 2640 Session of 2000
INTRODUCED BY HERMAN, STERN, SATHER, BUNT, FARGO, R. MILLER,
RUBLEY, SHANER, WILT AND BARD, JUNE 14, 2000
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, JUNE 14, 2000
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," further providing for remedies applicable to
8 various recovery program levels.
9 The General Assembly of the Commonwealth of Pennsylvania
10 hereby enacts as follows:
11 Section 1. Section 607(f) of the act of December 18, 1984
12 (P.L.1005, No.205), known as the Municipal Pension Plan Funding
13 Standard and Recovery Act, amended December 10, 1996 (P.L.934,
14 No.150), is amended to read:
15 Section 607. Remedies applicable to various recovery program
16 levels.
17 * * *
18 (f) Special municipal taxing authority.--If the tax rates
19 set by the municipality on earned income or on real property are
20 at the maximum provided by applicable law, the municipality may
1 increase its tax on either earned income or real property above
2 those maximum rates. An increase in the earned income tax shall
3 not be applicable to nonresidents who are subject to the earned
4 income tax. The proceeds of this special municipal tax increase
5 shall be used solely to defray the additional costs required to
6 be paid pursuant to this act which are directly related to the
7 pension plans of the municipality. The municipality utilizing
8 this special municipal taxing authority shall not reduce the
9 level of municipal contributions to the pension plans prior to
10 the implementation of the special municipal taxing authority.
11 The average level of municipal contributions to the pension
12 plans from all revenue sources for the three years immediately
13 prior to the implementation of the special municipal taxing
14 authority shall be expressed as a percentage of the average
15 covered payroll for that same three-year period: Provided,
16 however, That any supplemental contributions made to the plans
17 pursuant to any pension recovery legislation enacted by the
18 municipalities shall be excluded for purposes of determining the
19 level of municipal contribution to the pension plans prior to
20 the implementation of the special municipal taxing authority. In
21 each year subsequent to the implementation of the special
22 municipal taxing authority, the municipal contributions to the
23 pension plan from all revenue sources existing prior to the
24 implementation of the special existing municipal taxing
25 authority, reduced by any supplemental pension recovery
26 contributions, shall equal or exceed this average percentage of
27 the current covered payroll. A municipality utilizing the
28 provisions of section 404 may levy or continue to levy the
29 special municipal tax increase under this subsection provided
30 that the municipality does not reduce the level of municipal
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1 contributions to the pension plans prior to the implementation
2 of the special municipal taxing authority. In executing the
3 procedure prescribed in this subsection to determine the level
4 of municipal contributions, the debt service payments for bonds
5 or notes issued under section 404 shall be considered municipal
6 contributions.
7 * * *
8 Section 2. This act shall take effect in 60 days.
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