PRIOR PRINTER'S NO. 484 PRINTER'S NO. 1162
No. 471 Session of 1973
INTRODUCED BY REIBMAN, STAUFFER, SCALES, EWING AND MURPHY,
MARCH 12, 1973
SENATOR MURPHY, LOCAL GOVERNMENT, AS AMENDED, JUNE 26, 1973
AN ACT
1 Creating a Pennsylvania Municipal Retirement System for the
2 payment of retirement allowances to officers, employes,
3 firemen and police of political subdivisions and municipal
4 authorities and of institutions supported and maintained by
5 political subdivisions AND MUNICIPAL GOVERNMENT ASSOCIATIONS <--
6 and providing for the administration of the same by a board
7 composed of the State Treasurer and others appointed by the
8 Governor; imposing certain duties on the Pennsylvania
9 Municipal Retirement Board and the actuary thereof; providing
10 the procedure whereby political subdivisions and municipal
11 authorities may join such system, and imposing certain
12 liabilities and obligations on such political subdivisions
13 and municipal authorities in connection therewith, and as to
14 certain existing retirement and pension systems, and upon
15 officers, employes, firemen and police of such political
16 subdivisions, institutions supported and maintained by
17 political subdivisions, and upon municipal authorities;
18 providing for the continuation of certain municipal
19 retirement systems now administered by the Commonwealth;
20 providing certain exemptions from taxation, execution,
21 attachment, levy and sale and providing for the repeal of
22 certain related acts.
23 The General Assembly of the Commonwealth of Pennsylvania
24 hereby enacts as follows:
25 ARTICLE I
26 GENERAL PROVISIONS
27 Section 101. This act shall be known and may be cited as the
28 "Pennsylvania Municipal Retirement Law."
1 Section 102. Definitions.--As used in this act:
2 "Accumulated deductions" means the total amount deducted from
3 the salary or compensation of the contributor and paid over by
4 the municipality or paid by the member or from any existing
5 pension or retirement system directly into the retirement fund
6 and credited to the member's account, together with regular
7 interest thereon, unless interest is excluded in a contract for
8 an optional retirement plan entered into under the provisions of
9 clause (11) of section 104 of this act.
10 "Actuarially sound" means a plan which is being operated
11 under supervision of an actuary and which is being funded
12 annually at a level not lower than the normal cost of the plan
13 plus a contribution towards the unfunded accrued liability
14 sufficient to complete the funding thereof within thirty years
15 of the effective date of the system. If the unfunded accrued
16 liability is increased subsequent to the effective date of the
17 system, such additional liability shall be funded within a
18 period of thirty years from the effective date of the increase.
19 "Actuary" means: (i) a member of the American Academy of
20 Actuaries, or (ii) an individual who has demonstrated to the
21 satisfaction of the Insurance Commissioner of Pennsylvania that
22 he had the educational background necessary for the practice of
23 actuarial science and has had at least seven years of actuarial
24 experience, or (iii) a firm, partnership or corporation of which
25 one or more members meets the requirements of subclauses (i) or
26 (ii) above.
27 "Annuitant" means a former contributor in receipt of a
28 superannuation retirement allowance or other benefit provided by
29 this act.
30 "Beneficiary" means a person designated by a contributor or
19730S0471B1162 - 2 -
1 an annuitant to receive benefits after the death of such
2 contributor or annuitant.
3 "Board" means the Pennsylvania Municipal Retirement Board
4 created by this act.
5 "Contributor" means a member who has accumulated deductions
6 standing to his credit in the member's account of the fund
7 created by this act.
8 "Equivalent actuarial value" means benefits which have equal
9 present value when computed on the basis of regular interest and
10 the mortality tables adopted by the board and in use at the date
11 the benefit becomes effective.
12 "Final salary" means the average annual salary or
13 compensation earned by a member and paid by the municipality
14 during the last five years immediately preceding retirement, or
15 if not so long employed, then the average annual salary or
16 compensation earned and paid during the whole period of such
17 employment; or, if applicable, the amount or formula stipulated
18 between the municipality and the board in a contract for an
19 optional retirement plan entered into under the provisions of
20 clause (11) of section 104 of this act.
21 "Fund" means the Pennsylvania Municipal Retirement Fund
22 created by this act.
23 "Joint coverage member" means a member who shall have become
24 a member of the retirement system subsequent to the last date
25 permitted by the municipality employing him for statement of
26 preference concerning social security coverage, or who, having
27 become a member on or before such date, shall have filed with
28 the municipality a written statement that he elects social
29 security coverage under an agreement with the Federal Secretary
30 of Health, Education and Welfare entered into by the
19730S0471B1162 - 3 -
1 Commonwealth.
2 "Member" means a municipal officer, employe, fireman or
3 policeman, OR AN EMPLOYE OF A MUNICIPAL GOVERNMENT ASSOCIATION <--
4 who has become a member of the Pennsylvania Municipal Retirement
5 System created by this act.
6 "Member's account" means the account to which shall be
7 credited the payroll deductions and other contributions, plus
8 interest, if any, of the members.
9 "Member's annuity" means that portion or component of the
10 retirement allowance which is of equivalent actuarial value, at
11 date of retirement, to the accumulated deductions of the member.
12 "Municipal account" means the account maintained for each
13 municipality, to which shall be credited the contributions made
14 by it toward the superannuation retirement and death benefits of
15 members.
16 "Municipal annuity" means that portion or component of the
17 retirement allowance computed in accordance with the formula
18 applicable to each municipality.
19 "Municipal employe" means a person holding an office or
20 position, other than that of a municipal fireman or municipal
21 policeman, under a municipality OR A MUNICIPAL GOVERNMENT <--
22 ASSOCIATION and paid on a regular salary or per diem basis. The
23 term shall not include officers and employes paid wholly on a
24 fee basis.
25 "Municipal fireman" means a person holding a full-time
26 position in the fire department of a municipality and who works
27 for a stated salary or compensation.
28 "Municipal policeman" means a person holding a full-time
29 position in the police department of a municipality and who
30 works for a stated salary or compensation.
19730S0471B1162 - 4 -
1 "Municipality" means a city, borough, town, township, county,
2 institution district, or any newly created governmental unit, or
3 an authority created by a city, borough, town, township, county
4 or county institution district, or jointly by any such political
5 subdivisions, or an institution supported and maintained by a
6 municipality OR A MUNICIPAL GOVERNMENT ASSOCIATION, or an <--
7 industrial development agency as defined by the act of May 31,
8 1956 (P.L.1911, No.635), known as the "Industrial Development
9 Assistance Law," which has adopted bylaws and the governing body
10 of which is organized and holds regular public meetings.
11 "New member" means a municipal officer, employe, fireman or
12 policeman, OR AN EMPLOYE OF A MUNICIPAL GOVERNMENT ASSOCIATION <--
13 who first becomes a member after the date the municipality by
14 which he is employed joined the retirement system created by
15 this act.
16 "Original member" means a municipal officer, employe, fireman
17 or policeman, OR AN EMPLOYE OF A MUNICIPAL GOVERNMENT <--
18 ASSOCIATION who was employed by the municipality at the date the
19 municipality joined the system.
20 "Prior salary" means the annual salary or compensation earned
21 by a member and paid by the municipality during the year
22 immediately preceding the date the municipality by which he is
23 employed joined the system.
24 "Prior service" means all service as a municipal employe,
25 municipal fireman or municipal policeman completed at the time
26 the municipality by which he is or was employed elected to join
27 the system or the same municipality under a prior name or
28 classification, unless the municipality has elected to limit the
29 period of such service for municipal employes enrolled in a plan
30 under Article II or Article IV of this act.
19730S0471B1162 - 5 -
1 "Regular interest" means the rate fixed by the board, from
2 time to time, on the basis of earnings on investments.
3 "Retired member's reserve account" means the account from
4 which all retirement allowances shall be paid for superannuation
5 and total disability retirement and voluntary and involuntary
6 withdrawals.
7 "Retirement allowance" means the sum of the municipal annuity
8 and the member's annuity and, if the member is entitled to a
9 disability annuity under the provisions of this act, the
10 disability annuity.
11 "Service connected disability" means total and permanent
12 disability of a member prior to eligibility for superannuation
13 retirement resulting from a condition arising out of and
14 incurred in the course of his employment, and which is
15 compensable under the applicable provisions of the act of June
16 2, 1915 (P.L.736, No.338), known as "The Pennsylvania Workmen's
17 Compensation Act," or the act of June 21, 1939 (P.L.566,
18 No.284), known as "The Pennsylvania Occupational Disease Act."
19 "Single coverage member" means a member who shall become a
20 member of the retirement system on or before the last date
21 permitted by the municipality employing him for statement of
22 preference concerning social security coverage and who either
23 shall have filed with the municipality a written statement that
24 he does not elect social security coverage under any agreement
25 with the Federal Secretary of Health, Education and Welfare
26 entered into by the Commonwealth, or shall not have filed with
27 the municipality any written statement.
28 "Superannuation retirement age" means sixty-five years of age
29 for municipal employes, fifty-five years of age for municipal
30 firemen and municipal police or such other age as may be
19730S0471B1162 - 6 -
1 stipulated between the municipality and the board in a contract
2 for an optional retirement plan entered into under the
3 provisions of clause (11) of section 104 of this act.
4 "Survivor annuitant" means any person who has been named by a
5 member under a joint and survivor annuity option to receive an
6 annuity upon the death of such member.
7 "System" means the Pennsylvania Municipal Retirement System
8 as established herein.
9 "Total disability reserve account" means the account to which
10 shall be credited the contributions made by municipalities
11 toward the disability retirement of members.
12 Section 103. Pennsylvania Municipal Retirement Board.--A
13 Pennsylvania Municipal Retirement Board is hereby created, which
14 shall consist of the State Treasurer, four SIX municipal <--
15 employes employed by different classes of municipalities which
16 have joined the system, one municipal fireman employed by a
17 municipality which has joined the system and one municipal
18 policeman employed by a municipality which has joined the
19 system. The six EIGHT latter members shall be appointed by the <--
20 Governor from among nominations made by various associations of
21 county and municipal taxing officials and associations
22 representing municipal firemen and municipal police, to serve
23 for a term of four years each and until their successors are
24 appointed and qualified. Appointments of members made by the
25 Governor shall not require the advice and consent of the Senate.
26 The two municipal employe members of the Municipal Employes'
27 Retirement Board, appointed by the Governor from among
28 nominations made by various associations of county and municipal
29 taxing officials, who are serving on the effective date of this
30 act, shall continue to serve as members of the Pennsylvania
19730S0471B1162 - 7 -
1 Municipal Retirement Board until the expiration of their
2 respective terms.
3 A chairman and vice chairman of the board shall be elected by
4 the board every four years.
5 Vacancies happening from among members appointed from among
6 the nominations made by the associations shall be filled by the
7 appointment of a successor for a full term of four years.
8 No appointed member shall serve more than two consecutive
9 full terms.
10 Each member of the board shall take an oath of office that he
11 will diligently and honestly administer the affairs of the
12 board, and that he will not knowingly violate or wilfully permit
13 to be violated any of the provisions of this act.
14 A quorum of the board shall consist of four FIVE members. <--
15 Section 104. General Powers of the Board.--The board shall:
16 (1) Appoint a secretary who shall appoint the clerical and
17 other employes of the board, whose positions, including the
18 secretary's, shall be under the classified service provisions of
19 the act of August 5, 1941 (P.L.752, No.286), as amended and the
20 secretary shall fill future vacancies in accordance with such
21 provisions. The compensation of all persons so appointed shall
22 be fixed by the board and shall be consistent with the standards
23 established by the Executive Board of this Commonwealth;
24 (2) Contract for professional services, including but not
25 limited to actuarial, investment and medical as it deems
26 advisable;
27 (3) Keep in convenient form such data as shall be deemed
28 necessary for actuarial valuation purposes;
29 (4) From time to time, through its actuary, make an
30 actuarial investigation into the mortality and service
19730S0471B1162 - 8 -
1 experience of the contributors and annuitants and of the various
2 accounts created by this act;
3 (5) Adopt for the system one or more mortality tables and
4 such other tables as shall be deemed necessary;
5 (6) Certify the rates of deduction from salary necessary to
6 pay the member's annuities;
7 (7) Certify annually the amount of appropriation which each
8 municipality shall pay into the retirement fund, which amounts
9 shall be based on estimates furnished by the actuary, and shall
10 be credited to the municipal account of the fund;
11 (8) Prepare and publish annually a financial statement
12 showing the condition of the fund and the various accounts
13 thereof, and setting forth such other facts, recommendations and
14 data as may be of use in the advancement of knowledge concerning
15 the Pennsylvania Municipal Retirement System, and furnish a copy
16 thereof to each municipality which has joined the system, and to
17 such persons as may request copies thereof;
18 (9) Keep a record of all its proceedings, which will be open
19 to inspection by the public;
20 (10) From time to time, with the advice of the Attorney
21 General and the actuary, adopt and promulgate such rules and
22 regulations as may be required for the proper administration of
23 the fund created by this act and the several accounts thereof,
24 and for the transaction of the business of the board;
25 (11) Be authorized to approve any optional retirement plan
26 for municipal employes, municipal firemen or municipal police,
27 with any municipality as long as it is actuarially sound and
28 benefits under the plan are not in excess of or member's minimum
29 contribution rates are not less than those provided in other
30 existing retirement laws pertaining to that class of
19730S0471B1162 - 9 -
1 municipality;
2 (12) Perform such other functions as are required for the
3 execution of the provisions of this act.
4 Section 105. Preliminary Actuarial Investigation Tables and
5 Rates.--As soon as may be after the passage of this act, the
6 actuary shall make an investigation of the mortality, service
7 and salary experience of municipal employes, municipal firemen
8 and municipal police as he shall deem necessary, for the purpose
9 of determining upon tentative tables and municipal
10 contributions. On the basis of such investigation and
11 recommendation, the board shall adopt such tentative tables and
12 certify such tentative rates for the purpose of giving
13 municipalities and municipal employes, municipal firemen and
14 municipal police estimates of the cost involved in electing to
15 join the retirement system established by this act. Such tables
16 may thereafter be accepted or changed by the board, as
17 experience may require.
18 Section 106. Information to Municipalities.--The board
19 shall, with the aid of its actuary, prepare a circular of
20 information relative to the system, showing estimates of the
21 costs thereof to municipalities and members, including costs of
22 administration, the benefits to be derived therefrom, the
23 methods of administration by the board and the municipality, and
24 such other information as may be deemed appropriate. Such
25 circular of information shall be furnished to municipalities
26 upon request.
27 Section 107. Election by Municipalities to Join Retirement
28 System.--Any municipality may elect, by ordinance or resolution
29 adopted by the tax levying body, or in the case of municipal
30 authorities by the board of such municipal authority to join the
19730S0471B1162 - 10 -
1 system: Provided, however, That any municipality electing
2 coverage under the provisions of Article II of this act must
3 have first placed its municipal employes in so far as they are
4 eligible under the Federal Social Security Act. In the case of
5 townships of the second class, no resolution shall be adopted,
6 except by unanimous vote of all three supervisors.
7 Any municipality, by action of its tax levying body, may and
8 upon petition of electors equal to at least five per cent of the
9 registered electors of the municipality, shall, submit the
10 question of joining such system to the voters of the
11 municipality at any municipal or general election, in the same
12 manner as other questions are submitted to the electors under
13 the election code of the Commonwealth. If the majority of the
14 electors voting on the question vote in favor thereof, the tax
15 levying body shall adopt an ordinance or resolution electing to
16 join such system. If the electors vote against joining the
17 system, then no further action shall be taken in the
18 municipality for a period of two years.
19 A duly certified copy of any such ordinance or resolution
20 electing to join the system shall be filed with the board.
21 Section 108. Retirement Funds and Accounts.--The
22 Pennsylvania Municipal Retirement Fund shall consist of the
23 money received from municipalities arising from contributions by
24 municipalities, and from payroll deductions from salary or
25 compensation of members, and other contributions made by members
26 through the municipality to the system, from transfers made from
27 municipal retirement or pension systems and credited as provided
28 in this act, and investment earnings thereon.
29 Contributions made by municipalities toward superannuation
30 retirement and death benefits of members shall be credited to
19730S0471B1162 - 11 -
1 the municipal account of said fund, contributions made by
2 municipalities toward disability retirement of members shall be
3 credited to the total disability reserve account of said fund,
4 and payroll deductions and other contributions of members shall
5 be credited to the member's account of said fund. Transfers made
6 from existing municipal retirement or pension systems shall be
7 credited as provided in this act.
8 The board shall keep separate accounts of each municipality
9 and for each separate class of employes enrolled by that
10 municipality under the several articles of this act, except the
11 total disability reserve account and the retired member's
12 reserve account which shall be maintained as pooled accounts.
13 Each municipality and the members thereof shall be liable to the
14 board for the amount of contributions required to cover the cost
15 of the retirement allowance and other benefits payable to such
16 members.
17 Upon the granting of a superannuation or voluntary or
18 involuntary withdrawal retirement allowance to any contributor,
19 the amount of such contributor's accumulated deductions in the
20 member's account shall lose their status as accumulated
21 deductions and shall be transferred to the retired member's
22 reserve account and the actuarial equivalent of the municipal
23 annuity shall be similarly transferred from the municipal
24 account to the retired member's reserve account.
25 Upon the granting of a disability retirement allowance to any
26 contributor, there shall be transferred to the retired member's
27 reserve account the amount of the contributor's accumulated
28 deductions in the member's account, the amount of the equivalent
29 actuarial value to the municipal annuity, and such additional
30 amount from the total disability reserve account as is needed in
19730S0471B1162 - 12 -
1 addition thereto to provide the actuarial equivalent of the
2 total disability allowance to which the contributor is entitled.
3 Section 109. Custody of and Payments from Fund.--All moneys
4 and securities in the fund shall be placed in the custody of the
5 State Treasurer for safekeeping, and all payments on account of
6 retirement allowances shall be made on requisition signed by the
7 chairman and secretary of the board.
8 Section 110. Management and Investment of Fund; Interest
9 Credits.--The members of the board shall be trustees of the
10 fund, and shall have the exclusive management of said fund, with
11 full power to invest the moneys therein, subject to the terms,
12 conditions, limitations and restrictions imposed by law upon
13 fiduciaries. The said trustees shall have power to hold,
14 purchase, sell, assign, transfer and dispose of any securities
15 and investments in said fund, as well as the proceeds of such
16 investments, and of the money belonging to such fund.
17 The board shall annually allow regular interest to the credit
18 on each account, including each contributor's account.
19 Section 111. Municipal Guarantee.--The regular interest
20 charges payable and the creation and maintenance of the
21 necessary reserves for the payment of the municipal and member's
22 annuities, as to any municipality in accordance with this act,
23 are hereby made the obligation of that municipality.
24 Section 112. Annual Estimates to Municipalities;
25 Administrative Expenses.--The board shall prepare and submit to
26 each municipality, on or before the first day of the fourth
27 month preceding the commencing of each municipality's fiscal
28 year, an itemized estimate of the amounts necessary to be
29 appropriated by the municipality to complete the payments of the
30 obligations of the municipality to the fund during its next
19730S0471B1162 - 13 -
1 fiscal year.
2 The board shall annually prepare and approve a budget
3 covering the administrative expenses of this act. Such expenses
4 as approved by the board shall be paid from receipts from
5 assessments made against each municipality for administrative
6 expenses. This assessment shall be based on the number of
7 members in each municipality and shall not exceed the sum of ten
8 dollars ($10) per member during calendar year 1973 and a sum of
9 twenty dollars ($20) TWENTY-FIVE DOLLARS ($25) per member in any <--
10 succeeding year. If in any year the amount received from such <--
11 assessments, when imposed at the maximum rate, is not sufficient
12 to cover the administrative expenses, then the balance of such
13 expenses shall be paid from interest earnings on the fund in
14 excess of the regular interest credited to the municipal and
15 member's accounts.
16 Section 113. Existing Local Retirement Systems.--Where a
17 municipality elects to join the system established by this act,
18 and is then maintaining a retirement or pension system or
19 systems covering its employes in whole or in part, those
20 employes so covered, and employes thereafter eligible to join
21 such pension system, shall not become members of the retirement
22 system established by this act, unless at the time the
23 municipality elects to join the system, the members of such
24 existing retirement or pension system shall, by the affirmative
25 vote of seventy-five per cent of all the members thereof, elect
26 to be covered by the retirement system established by this act.
27 At any time thereafter, within a period of three years after the
28 municipality has elected to join the system, but not thereafter,
29 the members of an existing retirement or pension system may, in
30 like manner, elect to join the system established by this act.
19730S0471B1162 - 14 -
1 In any such case, provisions may be made for the transfer of
2 moneys and securities in its retirement or pension fund or
3 funds, in whole or in part, to the fund established by this act.
4 Securities so transferred shall be only those acceptable to the
5 board. Securities not so acceptable shall be converted into
6 cash, and said cash transferred to the fund created by this act.
7 In any such transfer, provision shall be made to credit the
8 accumulated deductions of each member, at least the amount he
9 has paid into the retirement or pension system of the
10 municipality, which moneys shall be credited against the prior
11 service contributions of such member, or a municipality may turn
12 over to the retirement system created by this act any existing
13 local pension system on a completely funded basis, as to
14 pensioners and pension credits of members related to prior
15 service to the date of transfer, or on a partially funded basis
16 if the municipality pays annually into the retirement system
17 amounts sufficient to completely liquidate the municipality's
18 liability for prior service within a period not to exceed thirty
19 years.
20 No liability, on account of retirement allowances or pensions
21 being paid from any retirement or pension fund of the
22 municipality, shall attach against the fund, except as provided
23 in the agreement, making a transfer of an existing system in
24 accordance with this section. The liability to continue payment
25 of pensions not so transferred shall attach against the
26 municipality, which shall annually make appropriations from its
27 tax revenues sufficient to pay the same. In cases where workers
28 covered by an existing retirement or pension system elect to
29 join the system created by this act, the election to join shall
30 be deemed to have been made at the time the municipality elected
19730S0471B1162 - 15 -
1 to join the system, and the liabilities of the municipality
2 shall be fixed accordingly.
3 Section 114. Monthly Payments.--Any retirement allowance
4 created under the provisions of this act shall be paid in equal
5 monthly installments and shall not be increased, decreased,
6 revoked or repealed, except where specifically otherwise
7 provided by this act.
8 Section 115. Exemption of Retirement Allowance.--The
9 retirement allowance and the contributions of members to the
10 fund, all contributions returned to contributors under the
11 provisions of this act and the moneys in the fund created by
12 this act, shall be exempt from any State or municipal tax, and
13 from any levy, sale, garnishment, attachment or other process
14 whatsoever, and shall be unassignable except to a beneficiary.
15 Section 116. Source of Municipal Funds.--The amounts to be
16 paid by municipalities under the provisions of this act shall be
17 paid out of moneys raised annually by general taxation, or in
18 the case of townships of the second class, out of taxes levied
19 for road, bridge and general township purposes and out of moneys
20 received from the State which are designated for pension
21 purposes.
22 ARTICLE II
23 PROVISIONS RELATING TO MUNICIPAL EMPLOYES
24 Section 201. Purpose.--This article shall provide for the
25 uninterrupted continuation of retirement plans established under
26 the act of June 4, 1943 (P.L.886, No.371), known as the
27 "Municipal Employes' Retirement Law." It shall also provide for
28 the enrollment of municipal employes' of new municipalities
29 joining the system, at the contribution rates and benefit rates
30 outlined in this article of the act.
19730S0471B1162 - 16 -
1 Section 202. Transfer of the Municipal Employes' Retirement
2 Fund to the Pennsylvania Municipal Retirement Fund.--On the
3 effective date of this act all of the assets and liabilities of
4 the Municipal Employes' Retirement Fund shall be transferred
5 intact to the Pennsylvania Municipal Retirement Fund. The rights
6 and benefits of the members and of the municipalities which have
7 joined the Municipal Employes' Retirement System shall not be
8 impaired in any way as a result of this transfer. Likewise, the
9 obligations and responsibilities of both the members and the
10 member municipalities which have joined the system shall not be
11 changed and the contractual arrangements as they existed at the
12 time the municipalities joined the Municipal Employes'
13 Retirement System shall continue in force. Prior service credits
14 for any members so transferred shall be computed from the date
15 on which the municipality joined the Municipal Employes'
16 Retirement System.
17 Section 203. Compulsory and Optional Membership.--If a <--
18 SECTION 203. EXISTING LOCAL RETIREMENT SYSTEMS AND <--
19 COMPULSORY AND OPTIONAL MEMBERSHIP.--WHERE A MUNICIPALITY ELECTS
20 TO JOIN THE SYSTEM ESTABLISHED BY THIS ACT, AND IS THEN
21 MAINTAINING A RETIREMENT OR PENSION SYSTEM OR SYSTEMS COVERING
22 ITS EMPLOYES IN WHOLE OR IN PART, THOSE EMPLOYES SO COVERED, AND
23 EMPLOYES THEREAFTER ELIGIBLE TO JOIN SUCH PENSION SYSTEM, SHALL
24 NOT BECOME MEMBERS OF THE RETIREMENT SYSTEM ESTABLISHED BY THIS
25 ACT, UNLESS AT THE TIME THE MUNICIPALITY ELECTS TO JOIN THE
26 SYSTEM, THE MEMBERS OF SUCH EXISTING RETIREMENT OR PENSION
27 SYSTEM SHALL, BY THE AFFIRMATIVE VOTE OF SEVENTY-FIVE PER CENT
28 OF ALL THE MEMBERS THEREOF, ELECT TO BE COVERED BY THE
29 RETIREMENT SYSTEM ESTABLISHED BY THIS ACT. AT ANY TIME
30 THEREAFTER, WITHIN A PERIOD OF THREE YEARS AFTER THE
19730S0471B1162 - 17 -
1 MUNICIPALITY HAS ELECTED TO JOIN THE SYSTEM, BUT NOT THEREAFTER,
2 THE MEMBERS OF AN EXISTING RETIREMENT OR PENSION SYSTEM MAY, IN
3 LIKE MANNER, ELECT TO JOIN THE SYSTEM ESTABLISHED BY THIS ACT.
4 IN ANY SUCH CASE, PROVISIONS MAY BE MADE FOR THE TRANSFER OF
5 MONEYS AND SECURITIES IN ITS RETIREMENT OR PENSION FUND OR
6 YEARS.
7 NO LIABILITY, ON ACCOUNT OF RETIREMENT ALLOWANCES OR PENSIONS
8 BEING PAID FROM ANY RETIREMENT OR PENSION FUND OF THE
9 MUNICIPALITY, SHALL ATTACH AGAINST THE FUND, EXCEPT AS PROVIDED
10 IN THE AGREEMENT, MAKING A TRANSFER OF AN EXISTING SYSTEM IN
11 ACCORDANCE WITH THIS SECTION. THE LIABILITY TO CONTINUE PAYMENT
12 OF PENSIONS NOT SO TRANSFERRED SHALL ATTACH AGAINST THE
13 MUNICIPALITY, WHICH SHALL ANNUALLY MAKE APPROPRIATIONS FROM ITS
14 TAX REVENUES SUFFICIENT TO PAY THE SAME. IN CASES WHERE WORKERS
15 COVERED BY AN EXISTING RETIREMENT OR PENSION SYSTEM ELECT TO
16 JOIN THE SYSTEM CREATED BY THIS ACT, THE ELECTION TO JOIN SHALL
17 BE DEEMED TO HAVE BEEN MADE AT THE TIME THE MUNICIPALITY ELECTED
18 TO JOIN THE SYSTEM, AND THE LIABILITIES OF THE MUNICIPALITY
19 SHALL BE FIXED ACCORDINGLY.
20 IF A municipality elects to join the system under the
21 provisions of this Article II, then each officer other than
22 elected officers, and each employe thereof other than a
23 municipal fireman and a municipal policeman, employed on a
24 permanent basis, except one who is not eligible for Federal
25 Social Security coverage and except one who is covered by an
26 existing retirement or pension system and is exempted under <--
27 section 113 of this act, AS OUTLINED ABOVE, shall be required to <--
28 become a member of the system. Each municipality shall determine
29 whether membership in said system for elected officials and
30 employes hired on a temporary or seasonal basis shall be
19730S0471B1162 - 18 -
1 compulsory, optional or prohibited. Where membership may be
2 optional with an elected officer or an employe hired on a
3 temporary or seasonal basis, an election to join the system must
4 be made within one year after the municipality elected to join
5 the system or within one year after the officer or temporary or
6 seasonal employe first entered the service of the municipality.
7 Officers and employes paid only on a fee basis shall not be
8 eligible to join the system.
9 Section 204. Service Allowance; Change of Employment;
10 MILITARY SERVICE.--In computing the length of service of a <--
11 contributor for retirement purposes, full credit shall be given
12 to each original member for each year of service rendered to the
13 municipality prior to the time the municipality joined the
14 system, whether or not such service was continuous.
15 As soon as practicable, the board shall issue to each
16 original member a certificate certifying the aggregate length of
17 service rendered to the municipality prior to the time it joined
18 the system. Such certificate shall be final and conclusive as to
19 his prior service unless thereafter modified by the board, upon
20 application of the member.
21 The time during which a member was absent from service
22 without pay shall not be counted in computing the service of a
23 contributor in his certificate, or upon retirement, unless
24 specifically allowed by the municipality, with the approval of
25 the board.
26 When a contributor leaves the employ of a municipality which
27 has joined the system, and enters into the employ of another
28 municipality which has also joined the system, his service
29 credits shall remain unimpaired, but in such cases the unpaid
30 municipal liability for prior service shall be prorated by the
19730S0471B1162 - 19 -
1 board between the municipalities on an equitable basis.
2 A CONTRIBUTOR WHO HAS BEEN EMPLOYED BY A MUNICIPALITY FOR A <--
3 PERIOD OF AT LEAST SIX MONTHS AND IS AN ACTIVE MEMBER OF THE
4 SYSTEM AND WHO THEREAFTER, HERETOFORE, OR HEREAFTER, SHALL BE
5 INDUCTED INTO THE MILITARY SERVICE OF THE UNITED STATES IN TIMES
6 OF WAR, ARMED CONFLICT, OR NATIONAL EMERGENCY, SO PROCLAIMED BY
7 THE PRESIDENT OF THE UNITED STATES, SHALL HAVE CREDITED TO HIS
8 EMPLOYMENT RECORD, FOR PENSION OR RETIREMENT BENEFITS, ALL OF
9 THE TIME SPENT BY HIM IN SUCH MILITARY SERVICE DURING THE
10 CONTINUANCE OF SUCH WAR, ARMED CONFLICT, OR NATIONAL EMERGENCY
11 IF SUCH PERSON RETURNS OR HAS HERETOFORE RETURNED TO HIS
12 EMPLOYMENT WITHIN SIX MONTHS AFTER HIS SEPARATION FROM THE
13 SERVICE. THE MUNICIPALITY SHALL, DURING THE PERIOD OF THE
14 MEMBER'S INTERVENING MILITARY SERVICE, CONTINUE TO MAKE CURRENT
15 SERVICE CONTRIBUTIONS TOWARD THE MUNICIPAL ANNUITY OF THE
16 MEMBER. AN ACTIVE MEMBER MAY FILE AN APPLICATION WITH THE BOARD
17 FOR PERMISSION TO PURCHASE CREDIT TOWARD HIS MEMBER'S SHARE OF
18 THE ANNUITY FOR INTERVENING MILITARY SERVICE. THESE
19 CONTRIBUTIONS SHALL BE COMPUTED BY APPLYING THE MEMBER'S
20 CONTRIBUTION RATE TO HIS ANNUAL RATE OF COMPENSATION AT THE TIME
21 OF ENTRY OF THE MEMBER INTO ACTIVE MILITARY SERVICE, AND
22 MULTIPLYING THE RESULT BY THE NUMBER OF YEARS AND FRACTIONAL
23 PART OF A YEAR OF CREDITABLE INTERVENING MILITARY SERVICE,
24 TOGETHER WITH INTEREST FROM DATE OF RETURN TO EMPLOYMENT TO DATE
25 OF PURCHASE. THE AMOUNT DUE FROM THE MEMBER SHALL BE CERTIFIED
26 BY THE BOARD IN ACCORDANCE WITH METHODS APPROVED BY THE ACTUARY,
27 AND MAY BE PAID BY (1) REGULAR MONTHLY PAYMENTS DURING ACTIVE
28 MILITARY SERVICE, OR (2) A LUMP SUM PAYMENT WITHIN THIRTY DAYS
29 OR (3) IT MAY BE AMORTIZED WITH ADDITIONAL INTEREST THROUGH
30 SALARY DEDUCTIONS IN AMOUNTS AGREED UPON BY THE MEMBER OF THE
19730S0471B1162 - 20 -
1 BOARD.
2 AN ACTIVE MEMBER MAY ALSO PURCHASE CREDIT FOR OTHER THAN
3 INTERVENING MILITARY SERVICE PERFORMED FOR THE UNITED STATED IN
4 TIMES OF WAR, ARMED CONFLICT OR NATIONAL EMERGENCY, SO
5 PROCLAIMED BY THE PRESIDENT OF THE UNITED STATES, FOR A PERIOD
6 NOT TO EXCEED FIVE YEARS: PROVIDED, THAT THE MEMBER HAS
7 COMPLETED FIVE YEARS OF SERVICE TO THE MUNICIPALITY SUBSEQUENT
8 TO SUCH MILITARY SERVICE. AN ACTIVE MEMBER MAY FILE AN
9 APPLICATION WITH THE BOARD FOR PERMISSION TO PURCHASE CREDIT FOR
10 NONINTERVENING MILITARY SERVICE UPON COMPLETION OF FIVE YEARS OF
11 SUBSEQUENT SERVICE TO THE MUNICIPALITY. THE TYPE OF SERVICE
12 CREDIT FOR SUCH SERVICE SHALL BE DETERMINED BY THE DATE OF ENTRY
13 OF THE MUNICIPALITY INTO THE SYSTEM. IF THE DATE OF THE MEMBER'S
14 SEPARATION FROM MILITARY SERVICE IS PRIOR TO THE DATE ON WHICH
15 THE MUNICIPALITY JOINED THE SYSTEM, THEN THE CREDIT PURCHASED
16 SHALL BE CONSIDERED AS PRIOR SERVICE CREDIT. IN THIS CASE THE
17 AMOUNT DUE FROM THE MEMBER SHALL BE COMPUTED BY APPLYING THE
18 MEMBER'S BASIC CONTRIBUTION RATE PLUS THE RATE OF CONTRIBUTION
19 THE MUNICIPALITY PAID FOR CURRENT SERVICE DURING ITS FIRST YEAR
20 OF ENTRY INTO THE SYSTEM TO HIS PRIOR SALARY AND MULTIPLYING THE
21 RESULT BY THE NUMBER OF YEARS AND FRACTIONAL PART OF A YEAR OF
22 CREDITABLE NONINTERVENING MILITARY SERVICE, PLUS INTEREST FROM
23 THE DATE OF THE MEMBER'S EMPLOYMENT BY THE MUNICIPALITY TO THE
24 DATE OF PURCHASE. THE AMOUNT DUE FROM THE MEMBER SHALL BE
25 CERTIFIED BY THE BOARD IN ACCORDANCE WITH METHODS APPROVED BY
26 THE ACTUARY, AND MAY BE PAID IN A LUMP SUM WITHIN THIRTY DAYS OR
27 IT MAY BE AMORTIZED WITH ADDITIONAL INTEREST THROUGH SALARY
28 DEDUCTIONS IN AMOUNTS AGREED UPON BY THE MEMBER AND THE BOARD.
29 IF, ON THE OTHER HAND, THE DATE OF THE MEMBER'S SEPARATION FROM
30 MILITARY SERVICE IS LATER THAN THE DATE OF ENTRY OF THE
19730S0471B1162 - 21 -
1 MUNICIPALITY INTO THE SYSTEM, THEN THE CREDIT PURCHASED SHALL BE
2 CONSIDERED AS CURRENT SERVICE CREDIT. IN THIS CASE THE AMOUNT
3 DUE FROM THE MEMBER SHALL BE COMPUTED BY APPLYING THE MEMBER'S
4 BASIC CONTRIBUTION RATE PLUS THE MUNICIPALITY'S NORMAL
5 CONTRIBUTION RATE FOR CURRENT SERVICE WHICH WAS IN EFFECT ON THE
6 DATE OF THE MEMBER'S ENTRY INTO EMPLOYMENT WITH THE MUNICIPALITY
7 TO HIS AVERAGE ANNUAL RATE OF COMPENSATION OVER THE FIRST FIVE
8 YEARS OF HIS SUBSEQUENT EMPLOYMENT AND MULTIPLYING THE RESULT BY
9 THE NUMBER OF YEARS AND FRACTIONAL PART OF A YEAR OF CREDITABLE
10 NONINTERVENING MILITARY SERVICE BEING PURCHASED, PLUS INTEREST
11 FROM THE DATE OF EMPLOYMENT BY THE MUNICIPALITY TO DATE OF
12 PURCHASE.
13 THE AMOUNT DUE FROM THE MEMBER SHALL BE CERTIFIED BY THE
14 BOARD IN ACCORDANCE WITH METHODS APPROVED BY THE ACTUARY, AND
15 MAY BE PAID IN A LUMP SUM WITHIN THIRTY DAYS OR IT MAY BE
16 AMORTIZED WITH ADDITIONAL INTEREST THROUGH SALARY DEDUCTIONS IN
17 AMOUNTS AGREED UPON BY THE MEMBER AND THE BOARD.
18 THE RATE OF INTEREST TO BE CHARGED TO MEMBERS ON THEIR
19 PURCHASE OF CREDIT FOR INTERVENING OR NONINTERVENING MILITARY
20 SERVICE SHALL BE THE RATE BEING CREDITED BY THE SYSTEM TO
21 MEMBER'S CONTRIBUTION ACCOUNTS IN EFFECT ON THE DATE OF THE
22 MEMBER'S APPLICATION, COMPOUNDED ANNUALLY.
23 A MEMBER MAY PURCHASE CREDIT FOR INTERVENING OR
24 NONINTERVENING MILITARY SERVICE ONLY IF HIS DISCHARGE OR
25 SEPARATION FROM THE SERVICE WAS GRANTED UNDER OTHER THAN
26 DISHONORABLE CONDITIONS.
27 A MEMBER MAY NOT PURCHASE CREDIT FOR ANY MILITARY SERVICE FOR
28 WHICH HE IS ENTITLED TO RECEIVE A RETIREMENT ALLOWANCE FROM THE
29 UNITED STATES GOVERNMENT.
30 APPLICATIONS FOR PERMISSION TO PURCHASE CREDIT FOR MILITARY
19730S0471B1162 - 22 -
1 SERVICE MUST BE ACCOMPANIED BY PROOF OF THE NATURE OF HIS
2 DISCHARGE OR SEPARATION FROM THE MILITARY SERVICE.
3 Section 205. Determination of Municipal Liability.--The
4 actuary shall as soon as may be, determine the present value of
5 the liability of each municipality for the prior service credits
6 to its original members, and shall establish an amount payable
7 annually over a period not exceeding thirty years, through which
8 payments such prior service liability may be funded. Each
9 municipality shall have the option to spread the payment of such
10 prior service liability over such period of years.
11 The municipal liability to be determined by the actuary shall
12 be based upon credit for all years of prior service toward the
13 municipal annuity of each original member, subject to such of
14 the following options as the municipality may elect:
15 (1) The municipality may limit to ten years the credit for
16 prior service toward the municipal annuity of each original
17 member;
18 (2) The municipality may assume the liability for payment of
19 the member's contributions for the prior service or any portion
20 thereof of each original member.
21 The actuary shall also determine, from time to time, the
22 amount which shall be contributed annually by each municipality
23 for service credits of original and new members subsequent to
24 the time the municipality joined the system, and the additional
25 amount which shall be contributed annually by each municipality
26 toward a reserve account for disability allowances payable to
27 original or new members, in order that all future service
28 liability may be fully funded on an actuarial basis.
29 The amounts so determined by the actuary may be expressed in
30 a percentage of the payroll of the municipality covering its
19730S0471B1162 - 23 -
1 contributing members.
2 The cost of making the valuations required by this section
3 and in the transfer of any existing pension system of any
4 municipality, shall be part of the costs of administration of
5 this act.
6 Section 206. Contributions by Members; Consolidation of
7 Credits; Change of Employment.--Each member of the system shall
8 be required to contribute to the fund such per cent of his
9 actual salary or compensation, including fees where paid in part
10 on a fee basis, as shall be computed by the actuary to be
11 approximately sufficient to procure for him on a superannuation
12 retirement age, a member's annuity of approximately one two-
13 hundred-fiftieth of that portion of his final salary on which
14 social security benefits are payable and of one one-hundred-
15 twenty-fifth of any portion of his final salary in excess of the
16 amount on which social security benefits are payable for each
17 year of service, after the time the municipality by which he is
18 employed joined the system.
19 In order to increase his member's annuity, each member shall
20 also have the option to make contributions for his prior
21 service. Such contributions for prior service may be anticipated
22 in whole or in part at the time the municipality joins the
23 system, or payment thereof or such part thereof as is not
24 anticipated may be spread over a period of time by increasing
25 the payroll deduction of the member by at least one-third. When
26 a member elects to contribute on account of all of his unpaid
27 prior service, his rate of contribution shall be calculated as
28 of his age at the time he first entered the service of the
29 municipality: Provided, however, That any municipality may, at
30 the time it elects to join the system, or at any time
19730S0471B1162 - 24 -
1 thereafter, agree with the board to pay into the fund as part of
2 its liability under and in accordance with section 205 hereof,
3 the moneys necessary to provide the member's contributions for
4 prior service, and in such case no contributions for prior
5 service shall be made by the members.
6 Member's contributions shall be paid into the fund by the
7 municipality through payroll deductions in such manner and at
8 such time as the board may by rule and regulation determine.
9 When a municipal employe is employed by more than one
10 municipality, he shall be required to make contributions on
11 account of his salary paid by each municipality. In such cases
12 the board shall provide for the consolidation of credits of the
13 contributor and, upon his retirement, for a consolidated
14 retirement allowance.
15 Section 207. Withdrawal; Return to Service; Death in
16 Service.--(a) Should a contributor, before reaching
17 superannuation retirement age, for any reason cease to be a
18 municipal employe, he shall be paid by the board the full amount
19 of the accumulated deductions standing to his credit in the
20 member's account, unless he is entitled to vesting rights or to
21 a retirement allowance for retirement not voluntarily, and
22 elects to exercise such vesting rights or take such retirement
23 allowance. Should such former contributor thereafter return to
24 the service of the same municipality and restore to the fund, in
25 such manner as may be agreed upon by such person and the board,
26 his withdrawn accumulated deductions as they were at the time of
27 his separation from service, his annuity rights as they existed
28 at the time of separation from service shall be restored and his
29 obligations as a member shall begin again. The rate of
30 contribution of such returning member shall be the same as it
19730S0471B1162 - 25 -
1 was at the time he separated from service.
2 (b) Should a contributor, having attained or passed
3 superannuation age, elect, upon leaving the service of the
4 municipality, not to claim the retirement allowance to which he
5 is entitled, he shall, upon written application, be paid by the
6 board the full amount of the accumulated deductions standing to
7 his credit in the member's account.
8 (c) Should a person who has been retired on a retirement
9 allowance under this act, return to employment on a regular
10 full-time basis in the same municipality, his retirement
11 allowance shall cease, and all his rights as they existed at the
12 time of retirement shall be restored, and such person may by
13 further service and further payroll deductions add to such
14 rights on account of future retirement. For the purposes of this
15 section if a person is reemployed on a temporary or seasonal
16 basis and his gross post-retirement earnings from such
17 reemployment during the calendar year are less than two thousand
18 one hundred dollars ($2,100) or such other maximum as the board
19 may establish, he shall not be deemed reemployed, but if and
20 when his gross post-retirement earnings exceed two thousand one
21 hundred dollars ($2,100) or such other maximum as the board may
22 establish in any calendar year he shall not be entitled to
23 receive his retirement allowance for that month or any
24 subsequent month in the calendar year in which he continues in
25 service. The municipality is required to notify the board
26 immediately of the reemployment status of any retired former
27 employe and file separate monthly reports of his gross earnings
28 as prescribed by the board.
29 (d) Should a contributor die while in service, prior to
30 becoming eligible for a retirement allowance, his accumulated
19730S0471B1162 - 26 -
1 deductions shall be paid to his estate, or to such person, if
2 living, as he shall have designated in writing, filed with the
3 board as his beneficiary. In case any contributor has failed to
4 designate a beneficiary, or if the named beneficiary has
5 predeceased the member and no such successor beneficiary has
6 been named, and upon the death in service shall have less than
7 one hundred dollars ($100) in accumulated deductions standing to
8 his credit, the board may, if letters testamentary or of
9 administration have not been taken out on his estate within six
10 months after death, pay such accumulated deductions on the claim
11 of the undertaker, or to any person or municipality which shall
12 have paid the claim of the undertaker.
13 Section 208. Superannuation Retirement.--Retirement for
14 superannuation shall be as follows:
15 (a) Any contributor who has reached superannuation
16 retirement age may retire for superannuation by filing with the
17 board a written statement, duly attested, setting forth on what
18 date he desires to be retired. Said application shall make the
19 superannuation retirement allowance effective on the date so
20 specified, if such application was filed in the office of the
21 board or deposited in the United States mail, addressed to the
22 board, before the date specified in the application and before
23 the death of the contributor, but the date so specified in the
24 application shall not be more than ninety days after the date of
25 filing, or the date the application was deposited in the mail.
26 (b) On retirement for superannuation, a contributor shall be
27 entitled to a retirement allowance throughout his life, which
28 shall consist of:
29 (1) A member's annuity of equivalent actuarial value of his
30 accumulated deductions; and
19730S0471B1162 - 27 -
1 (2) A municipal annuity which shall be equal to (i) for
2 current service, one two-hundred-fiftieth of that portion of his
3 final salary on which social security benefits are payable plus
4 one one-hundred-twenty-fifth of any portion of his final salary
5 in excess of the amount on which social security benefits are
6 payable for each year of service while a member, and in addition
7 thereto, (ii) for prior service in case of an original member,
8 one two-hundred-fiftieth of that portion of his prior salary on
9 which social security benefits are payable plus one one-hundred-
10 twenty-fifth of any portion of his prior salary in excess of the
11 amount on which social security benefits are payable for each
12 year of prior service or for a maximum of ten years if the
13 municipality has so limited the period of prior service, and in
14 addition thereto, one two-hundred-fiftieth of his prior salary
15 on which social security benefits are payable plus one one-
16 hundred-twenty-fifth of any portion of his prior salary in
17 excess of the amount on which social security benefits are
18 payable for each year of prior service for which the
19 municipality has paid or has obligated itself to pay the
20 member's contributions.
21 (c) In no event shall the municipal annuity exceed fifty per
22 cent of the final salary.
23 Sections 209. Death Benefits.--(a) The provisions of
24 subsection (b) and (c) of this section shall not apply to any
25 member unless the municipality by which he is employed has
26 elected by ordinance or resolution, to extend the provisions of
27 this section to its employes. A duly certified copy of such
28 ordinance or resolution shall be filed with the board.
29 (b) A contributor to the system who is entitled to a
30 superannuation retirement allowance by reason of having reached
19730S0471B1162 - 28 -
1 superannuation retirement age or who is entitled to a withdrawal
2 allowance by reason of having completed twenty-four years of
3 total service, may file with the board a written application for
4 retirement, in the form required for such application, but
5 requesting that such retirement shall become effective as of the
6 time of his death, electing one of the options provided in
7 section 211 and nominating a person having an insurable interest
8 in his life under said option as required in said section. In
9 all such cases, the application shall be held by the board until
10 the contributor shall file a later application in the usual
11 manner for a superannuation retirement allowance or until the
12 death of the contributor occurring while in municipal service,
13 at which time his retirement shall become effective with the
14 same benefits to the person designated as if the contributor had
15 retired on the day immediately preceding his death.
16 (c) A contributor to the system who is entitled to a
17 superannuation retirement allowance by reason of having reached
18 superannuation retirement age or who is entitled to a withdrawal
19 allowance by reason of having completed twenty-four years of
20 total service and who has died in municipal service before
21 filing with the board a written application for a superannuation
22 retirement allowance as provided in subsection (b) of this
23 section shall be considered as having elected Option 1 as
24 provided in section 211 as of the date of his death. In such
25 event, payment under Option 1 shall be made to the beneficiary
26 designated in the nomination of beneficiary form on file with
27 the board, or if said beneficiary has predeceased the
28 contributor, to the legal representative of said contributor.
29 Section 210. Early Retirement.--Should a contributor be
30 discontinued from service not voluntarily, after having
19730S0471B1162 - 29 -
1 completed eight years of total service, or voluntarily after
2 having completed twenty-four years of total service, but in
3 either event before reaching superannuation retirement age, he
4 shall be paid as he may elect, as follows:
5 (1) The full amount of the accumulated deductions standing
6 to his credit in the member's account of the fund; or
7 (2) Upon the filing of an application in the manner outlined
8 in subsection (a) of section 208, a retirement allowance which
9 shall consist of (i) a member's annuity of equivalent actuarial
10 value to his accumulated deductions; and (ii) a municipal
11 annuity of equivalent actuarial value to the present value of a
12 municipal annuity, beginning at superannuation retirement age,
13 calculated in accordance with the provisions of section 208; or
14 (3) If qualified, a deferred retirement allowance as
15 provided in section 213.
16 Section 211. Options on Superannuation or Early
17 Retirement.--At the time of his superannuation or early
18 retirement, a contributor may elect to receive his benefits in a
19 retirement allowance payable throughout his life, which shall be
20 known as a single life annuity, or instead, he may elect to
21 receive the equivalent actuarial value at that time of his
22 retirement allowance in a lesser allowance, payable throughout
23 life with provisions that:
24 (1) Option 1. If he shall die before receiving in payments
25 the present value of his retirement allowance as it was at the
26 time of his retirement, the balance, if less than five thousand
27 dollars ($5,000), shall be paid in a lump sum to his legal
28 representative, or to or in trust for his beneficiary. If the
29 balance is five thousand dollars ($5,000) or more, the
30 beneficiary may elect by application duly acknowledged and filed
19730S0471B1162 - 30 -
1 with the board to receive payment of such balance according to
2 any one of the following provisions: (i) a lump sum payment;
3 (ii) an annuity having a present value equal to the balance
4 payable; (iii) a lump sum payment and an annuity. Such annuity
5 shall be of equivalent actuarial value to the balance payable
6 less the amount of the lump sum payment specified by the
7 beneficiary.
8 (2) Option 2. Upon his death, his retirement allowance
9 shall be continued throughout the life of and paid to his
10 survivor annuitant, if then living.
11 (3) Option 3. Upon his death, one-half of his retirement
12 allowance shall be continued throughout the life of and paid to
13 his survivor annuitant, if then living.
14 Section 212. Disability Retirement.--(a) After a contributor
15 has had ten or more years of total service, he may, upon
16 application or on the application of one acting in his behalf,
17 or upon application of a head of the department of the
18 municipality by which he is employed, be retired by the board on
19 a disability allowance if he is under superannuation retirement
20 age, and on a superannuation retirement allowance if he has
21 attained or passed such age, if the physician designated by the
22 board, after medical examination of the contributor made at the
23 place of residence of the contributor or at a place mutually
24 agreed upon, shall certify to the board that the contributor is
25 unable to engage in any gainful employment and that said
26 contributor ought to be retired. When the disability of a
27 contributor is determined to be service-connected, as defined in
28 this act, no minimum period of service shall be required for
29 eligibility. Application filing requirements shall be identical
30 to those outlined in subsection (a) of section 208.
19730S0471B1162 - 31 -
1 (b) On retirement for disability a member shall receive a
2 retirement allowance which shall consist of:
3 (1) A member's annuity of the equivalent actuarial value to
4 his accumulated deductions;
5 (2) A municipal annuity of the equivalent actuarial value to
6 the present value of a municipal annuity, beginning at
7 superannuation retirement age, calculated in accordance with the
8 provision of section 208; and
9 (3) A disability annuity payable from the total disability
10 reserve account which, together with the member's annuity and
11 the municipal annuity, shall be sufficient to produce a
12 retirement allowance of thirty per cent of the final salary.
13 Where the disability of the member is determined to be service-
14 connected, as defined in this act, the retirement allowance
15 shall equal fifty per cent of his final salary. The disability
16 annuity shall be reduced by the amount of any payments for which
17 the member shall be eligible under the act of June 2, 1915
18 (P.L.736, No.338), known as "The Pennsylvania Workmen's
19 Compensation Act," or the act of June 21, 1939 (P.L.566,
20 No.284), known as "The Pennsylvania Occupational Disease Act."
21 (c) Once every year the board may require any disability
22 annuitant, while still under superannuation retirement age, to
23 undergo medical examination by a physician designated by the
24 board. Such examination shall be made at the place of residence
25 of the beneficiary or other place mutually agreed upon. Should
26 the physician report and certify to the board that such
27 disability beneficiary is no longer physically or mentally
28 incapacitated for the performance of duty and is able to engage
29 in a gainful occupation, then his disability retirement
30 allowance shall be discontinued, and in lieu thereof an early
19730S0471B1162 - 32 -
1 involuntary retirement allowance shall at that time be granted
2 as if such person had been retired not voluntarily, if such
3 person shall have had eight or more years of total service.
4 (d) Should a disability annuitant, while under
5 superannuation retirement age, refuse to submit to at least one
6 medical examination in any year by a physician designated by the
7 board, his disability retirement allowance shall be discontinued
8 until the withdrawal of such refusal, and should such refusal
9 continue for one year, then all his rights in and to any
10 disability retirement allowance or for early involuntary
11 retirement allowance provided for by this act, shall be
12 forfeited.
13 (e) Any contributor entitled to retire for disability may,
14 in lieu of such retirement, if he has eight or more years of
15 total service, elect to retire not voluntarily under the
16 provisions of this act.
17 (f) Should a disability annuitant die before the total
18 disability retirement allowance received shall be at least equal
19 to the amount of his accumulated deductions at the time of
20 disability retirement, then the board shall pay to the named
21 beneficiary, if living, or if the beneficiary predeceased the
22 annuitant, or no beneficiary was named, then to the annuitant's
23 estate, an amount equal to the difference between such total
24 retirement allowance received and the annuitant's accumulated
25 deductions, and if such difference is less than one hundred
26 dollars ($100) and no letters have been taken out on the estate
27 within six months after death, then such difference may be paid
28 to the undertaker or to any person or municipality who or which
29 shall have paid the claim of the undertaker.
30 Section 213. Vesting.--(a) Should a contributor, before
19730S0471B1162 - 33 -
1 reaching superannuation retirement age and after having
2 completed twelve years of total service, for any reason cease to
3 be a municipal employe, he shall be entitled to vest his
4 retirement benefits until he attains superannuation retirement
5 age, by filing with the board a written notice of his intentions
6 to vest, within ninety days of the date of his termination.
7 (b) A contributor, who was terminated not voluntarily, may
8 elect, after he has vested, to be paid as follows:
9 (1) The full amount of the accumulated deductions, including
10 interest to the date of termination, standing to his credit in
11 the member's account of the fund; or
12 (2) An early retirement allowance as computed under the
13 provisions of clause (2) of section 210; or
14 (3) Upon reaching superannuation retirement age, a
15 superannuation retirement allowance as computed under the
16 provisions of section 208.
17 (c) A contributor, who voluntarily terminated his service,
18 may elect, after he has vested, to be paid as follows:
19 (1) The full amount of the accumulated deductions, including
20 interest to the date of termination, standing to his credit in
21 the member's account of the fund; or
22 (2) If the contributor has completed twenty-four years or
23 more of total service, a voluntary withdrawal allowance computed
24 in accordance with the provisions of section 210; or
25 (3) Upon reaching superannuation retirement age, a
26 superannuation retirement allowance as computed under the
27 provisions of section 208.
28 (d) Should a contributor, who has vested, die before he
29 becomes eligible for a retirement allowance, the full amount of
30 the accumulated deductions, including interest to the date of
19730S0471B1162 - 34 -
1 his termination, standing to his credit in the member's account
2 of the fund shall be paid to his estate or to his named
3 beneficiary in accordance with the provisions of subsection (d)
4 of section 207.
5 Section 214. Withdrawal Prohibited.--No municipality, after <--
6 it has joined the system under the provisions of this Article
7 II, shall be permitted to withdraw therefrom, and, in the case
8 of failure to make payments as required by this act, the
9 Commonwealth shall withhold payment to the municipality any
10 funds to which the municipality may be entitled for pension
11 purposes. The board may recover any sums due to the fund by suit
12 at law, or other appropriate remedy.
13 SECTION 214. WITHDRAWAL PROVISIONS.--AT ANY TIME WITHIN <--
14 THREE YEARS AFTER A MUNICIPALITY HAS INITIALLY JOINED THE
15 RETIREMENT SYSTEM CREATED OR CONTINUED UNDER THIS ARTICLE II IT
16 MAY WITHDRAW FROM THE SYSTEM IF IT HAS MET ALL OF ITS FINANCIAL
17 OBLIGATIONS TO THE FUND. THE MEMBER'S CONTRIBUTIONS OF THE
18 WITHDRAWING MUNICIPALITY'S EMPLOYES SHALL BE RETURNED TO THE
19 MEMBERS. NO REFUND OF ANY CONTRIBUTIONS PAID BY THE MUNICIPALITY
20 SHALL BE MADE AND THESE MONEYS SHALL REMAIN IN THE PENNSYLVANIA
21 MUNICIPAL RETIREMENT FUND FOR THE BENEFIT OF THE REMAINING
22 MEMBERS. ANY SUCH WITHDRAWAL MUST BE EFFECTED THROUGH AN
23 ORDINANCE OR RESOLUTION CONTAINING THE AFFIRMATIVE VOTE OF
24 SEVENTY-FIVE PER CENT OF ALL OF THE MEMBERS OF ITS LEGISLATIVE
25 BODY AND IF THE LEGISLATIVE BODY IS COMPOSED OF ONLY THREE
26 PERSONS, THEN BY AN UNANIMOUS AFFIRMATIVE VOTE. IN ALL CASES AN
27 AFFIRMATIVE VOTE APPROVING SUCH ACTION BY SEVENTY-FIVE PER CENT
28 OF THE MUNICIPAL EMPLOYES AFFECTED BY THE ORDINANCE OR
29 RESOLUTION MUST BE CERTIFIED BY THE MUNICIPALITY TO THE BOARD.
30 THEREAFTER, NO MUNICIPALITY, AFTER IT HAS JOINED THE SYSTEM
19730S0471B1162 - 35 -
1 UNDER THE PROVISIONS OF THIS ARTICLE II, SHALL BE PERMITTED TO
2 WITHDRAW THEREFROM, AND, IN THE CASE OF FAILURE TO MAKE PAYMENTS
3 AS REQUIRED BY THIS ACT, THE COMMONWEALTH SHALL WITHHOLD PAYMENT
4 TO THE MUNICIPALITY ANY FUNDS TO WHICH THE MUNICIPALITY MAY BE
5 ENTITLED FOR PENSION PURPOSES. THE BOARD MAY RECOVER ANY SUMS
6 DUE TO THE FUND BY SUIT AT LAW, OR OTHER APPROPRIATE REMEDY.
7 Section 215. Procedures for Amending Contracts.--Any
8 municipality which has joined the system under the provisions of
9 this Article II may, with the approval of the board, enter into
10 a contract with the board as outlined in Article IV of this act,
11 to increase any of the benefits enumerated in Article IV. The
12 board shall not enter into any contract with any municipality
13 which decreases benefits, nor shall it enter into any contract
14 with a municipality which provides for benefits in excess of or
15 minimum member's contribution rates less than those available to
16 it under any other existing law pertaining to the establishment
17 of retirement systems for that class of municipality. Before the
18 board approves any such contract it shall first determine,
19 through its actuary, that the plan outlined in the contract is
20 actuarially sound. Any municipality which elects to enter into a
21 contract for increased benefits which would result in an
22 increase in its employes contribution rates shall first obtain
23 the written consent of at least seventy-five per cent of its
24 then member employes. Additional costs for contracted increases
25 in benefits shall become the responsibility of the municipality
26 and/or the members as specified in the contract.
27 ARTICLE III
28 PROVISIONS RELATING TO MUNICIPAL FIREMEN AND MUNICIPAL POLICE
29 Section 301. Purpose.--This article shall provide for the
30 uninterrupted continuation of retirement plans established under
19730S0471B1162 - 36 -
1 the act of July 31, 1968 (P.L.944, No.291), known as the
2 "Municipal Police Retirement Law." It shall also provide for the
3 enrollment of municipal firemen and municipal police of new
4 municipalities joining the system at the contribution rates and
5 benefit rates outlined in this article of the act.
6 Section 302. Transfer of the Municipal Police Retirement
7 Fund to the Pennsylvania Municipal Retirement Fund.--On the
8 effective date of this act all of the assets and liabilities of
9 the Municipal Police Retirement Fund shall be transferred intact
10 to the Pennsylvania Municipal Retirement Fund. The rights and
11 benefits of the members and of the municipalities which have
12 joined the Municipal Police Retirement System shall not be
13 impaired in any way as a result of this transfer. Likewise, the
14 obligations and responsibilities of both the members and the
15 municipalities which have joined the system shall not be changed
16 and the contractual arrangements as they existed at the time the
17 municipalities joined the Municipal Police Retirement System
18 shall continue in force. Prior service credits for any members
19 so transferred shall be computed from the date on which the
20 municipality joined the Municipal Police Retirement System.
21 Section 303. Compulsory Membership.--If a municipality <--
22 SECTION 303. EXISTING LOCAL RETIREMENT SYSTEMS AND <--
23 COMPULSORY MEMBERSHIP.--WHERE A MUNICIPALITY ELECTS TO JOIN THE
24 SYSTEM ESTABLISHED BY THIS ACT, AND IS THEN MAINTAINING A
25 RETIREMENT OR PENSION SYSTEM OR SYSTEMS COVERING ITS EMPLOYES IN
26 WHOLE OR IN PART, THOSE EMPLOYES SO COVERED, AND EMPLOYES
27 THEREAFTER ELIGIBLE TO JOIN SUCH PENSION SYSTEM, SHALL NOT
28 BECOME MEMBERS OF THE RETIREMENT SYSTEM ESTABLISHED BY THIS ACT,
29 UNLESS AT THE TIME THE MUNICIPALITY ELECTS TO JOIN THE SYSTEM,
30 THE MEMBERS OF SUCH EXISTING RETIREMENT OR PENSION SYSTEM SHALL,
19730S0471B1162 - 37 -
1 BY THE AFFIRMATIVE VOTE OF SEVENTY-FIVE PER CENT OF ALL THE
2 MEMBERS THEREOF, ELECT TO BE COVERED BY THE RETIREMENT SYSTEM
3 ESTABLISHED BY THIS ACT. AT ANY TIME THEREAFTER, WITHIN A PERIOD
4 OF THREE YEARS AFTER THE MUNICIPALITY HAS ELECTED TO JOIN THE
5 SYSTEM, BUT NOT THEREAFTER, THE MEMBERS OF AN EXISTING
6 RETIREMENT OR PENSION SYSTEM MAY, IN LIKE MANNER, ELECT TO JOIN
7 THE SYSTEM ESTABLISHED BY THIS ACT. IN ANY SUCH CASE, PROVISIONS
8 MAY BE MADE FOR THE TRANSFER OF MONEYS AND SECURITIES IN ITS
9 RETIREMENT OR PENSION FUND OR YEARS.
10 NO LIABILITY, ON ACCOUNT OF RETIREMENT ALLOWANCES OR PENSIONS
11 BEING PAID FROM ANY RETIREMENT OR PENSION FUND OF THE
12 MUNICIPALITY, SHALL ATTACH AGAINST THE FUND, EXCEPT AS PROVIDED
13 IN THE AGREEMENT, MAKING A TRANSFER OF AN EXISTING SYSTEM IN
14 ACCORDANCE WITH THIS SECTION. THE LIABILITY TO CONTINUE PAYMENT
15 OF PENSIONS NOT SO TRANSFERRED SHALL ATTACH AGAINST THE
16 MUNICIPALITY, WHICH SHALL ANNUALLY MAKE APPROPRIATIONS FROM ITS
17 TAX REVENUES SUFFICIENT TO PAY THE SAME. IN CASES WHERE WORKERS
18 COVERED BY AN EXISTING RETIREMENT OR PENSION SYSTEM ELECT TO
19 JOIN THE SYSTEM CREATED BY THIS ACT, THE ELECTION TO JOIN SHALL
20 BE DEEMED TO HAVE BEEN MADE AT THE TIME THE MUNICIPALITY ELECTED
21 TO JOIN THE SYSTEM, AND THE LIABILITIES OF THE MUNICIPALITY
22 SHALL BE FIXED ACCORDINGLY.
23 IF A MUNICIPALITY elects to cover its municipal firemen under
24 the provisions of the system created by this Article III, then
25 each municipal fireman shall be required to become a member of
26 the system.
27 If a municipality elects to cover its municipal police under
28 the provisions of the system created by this Article III, then
29 each municipal policeman shall be required to become a member of
30 the system.
19730S0471B1162 - 38 -
1 Section 304. Separate Ordinances or Resolutions; Separate
2 Accounts.--Any municipality electing to cover both its municipal
3 firemen and municipal police under the system created by this
4 Article III shall be required to pass separate ordinances or
5 resolutions covering each class of employes.
6 The board shall maintain separate accounting records for
7 municipal firemen and for municipal police. However, in the
8 interest of good investment practice, the board may, in its
9 discretion, comingle moneys received from municipalities,
10 municipal employes, municipal firemen and municipal police.
11 Section 305. Service Allowance; Military Service; Change of <--
12 Employment.-- CHANGE OF EMPLOYMENT; MILITARY SERVICE.--In <--
13 computing the length of service of a contributor for retirement
14 purposes, full credit shall be given to each original member for
15 each year of service rendered to the municipality prior to the
16 time the municipality joined the system.
17 Any municipal fireman or municipal policeman employed by a <--
18 municipality who has been a regularly appointed fireman or
19 policeman for a period of at least six months and who
20 thereafter, heretofore, or hereafter, shall be inducted into the
21 military service of the United States in times of war, armed
22 conflict, or national emergency, so proclaimed by the President
23 of the United States, shall have credited to his employment
24 record, for pension or retirement benefits, all of the time
25 spent by him in such military service during the continuance of
26 such war, armed conflict, or national emergency if such person
27 returns or has heretofore returned to his employment within six
28 months after his separation from the service.
29 As soon as practicable, the board shall issue to each
30 original member a certificate certifying the aggregate length of
19730S0471B1162 - 39 -
1 service rendered to the municipality prior to the time it joined
2 the system. Such certificate shall be final and conclusive as to
3 his prior service unless thereafter modified by the board, upon
4 application of the member.
5 The time during which a member was absent from service
6 without pay, except for military service, shall not be counted
7 in computing the service of a contributor in his certificate, or
8 upon retirement unless specially allowed by the municipality,
9 with the approval of the board.
10 When a contributor leaves the employ of a municipality which
11 has joined the system, and enters into the employ of another
12 municipality which has also joined the system, his service
13 credits shall remain unimpaired, but in such cases the unpaid
14 municipal liability for prior service shall be prorated by the
15 board between the municipalities on an equitable basis.
16 ANY MUNICIPAL FIREMAN OR MUNICIPAL POLICEMAN EMPLOYED BY A <--
17 MUNICIPALITY WHO HAS BEEN A REGULARLY APPOINTED FIREMAN OR
18 POLICEMAN FOR A PERIOD OF AT LEAST SIX MONTHS AND IS AN ACTIVE
19 MEMBER OF THE SYSTEM AND WHO THEREAFTER, HERETOFORE, OR
20 HEREAFTER, SHALL BE INDUCTED INTO THE MILITARY SERVICE OF THE
21 UNITED STATES IN TIMES OF WAR, ARMED CONFLICT, OR NATIONAL
22 EMERGENCY, SO PROCLAIMED BY THE PRESIDENT OF THE UNITED STATES,
23 SHALL HAVE CREDITED TO HIS EMPLOYMENT RECORD, FOR PENSION OR
24 RETIREMENT BENEFITS, ALL OF THE TIME SPENT BY HIM IN SUCH
25 MILITARY SERVICE DURING THE CONTINUANCE OF SUCH WAR, ARMED
26 CONFLICT, OR NATIONAL EMERGENCY IF SUCH PERSON RETURNS OR HAS
27 HERETOFORE RETURNED TO HIS EMPLOYMENT WITHIN SIX MONTHS AFTER
28 HIS SEPARATION FROM THE SERVICE. THE MUNICIPALITY SHALL, DURING
29 THE PERIOD OF THE MEMBER'S INTERVENING MILITARY SERVICE,
30 CONTINUE TO MAKE CURRENT SERVICE CONTRIBUTIONS TOWARD THE
19730S0471B1162 - 40 -
1 MUNICIPAL ANNUITY OF THE MEMBER. AN ACTIVE MEMBER MAY FILE AN
2 APPLICATION WITH THE BOARD FOR PERMISSION TO PURCHASE CREDIT
3 TOWARD HIS MEMBER'S SHARE OF THE ANNUITY FOR INTERVENING
4 MILITARY SERVICE. THESE CONTRIBUTIONS SHALL BE COMPUTED BY
5 APPLYING THE MEMBER'S CONTRIBUTION RATE TO HIS ANNUAL RATE OF
6 COMPENSATION AT THE TIME OF ENTRY OF THE MEMBER INTO ACTIVE
7 MILITARY SERVICE, AND MULTIPLYING THE RESULT BY THE NUMBER OF
8 YEARS AND FRACTIONAL PART OF A YEAR OF CREDITABLE INTERVENING
9 MILITARY SERVICE, TOGETHER WITH INTEREST FROM DATE OF RETURN TO
10 EMPLOYMENT TO DATE OF PURCHASE. THE AMOUNT DUE FROM THE MEMBER
11 SHALL BE CERTIFIED BY THE BOARD IN ACCORDANCE WITH METHODS
12 APPROVED BY THE ACTUARY, AND MAY BE PAID BY (1) REGULAR MONTHLY
13 PAYMENTS DURING ACTIVE MILITARY SERVICE, OR (2) A LUMP SUM
14 PAYMENT WITHIN THIRTY DAYS, OR (3) IT MAY BE AMORTIZED WITH
15 ADDITIONAL INTEREST THROUGH SALARY DEDUCTIONS IN AMOUNTS AGREED
16 UPON BY THE MEMBER AND THE BOARD.
17 AN ACTIVE MEMBER MAY ALSO PURCHASE CREDIT FOR OTHER THAN
18 INTERVENING MILITARY SERVICE PERFORMED FOR THE UNITED STATES IN
19 TIMES OF WAR, ARMED CONFLICT OR NATIONAL EMERGENCY, SO
20 PROCLAIMED BY THE PRESIDENT OF THE UNITED STATES, FOR A PERIOD
21 NOT TO EXCEED FIVE YEARS: PROVIDED, THAT THE MEMBER HAS
22 COMPLETED FIVE YEARS OF SERVICE TO THE MUNICIPALITY SUBSEQUENT
23 TO SUCH MILITARY SERVICE. AN ACTIVE MEMBER MAY FILE AN
24 APPLICATION WITH THE BOARD FOR PERMISSION TO PURCHASE CREDIT FOR
25 NONINTERVENING MILITARY SERVICE UPON COMPLETION OF FIVE YEARS OF
26 SUBSEQUENT SERVICE TO THE MUNICIPALITY. THE TYPE OF SERVICE
27 CREDIT FOR SUCH SERVICE SHALL BE DETERMINED BY THE DATE OF ENTRY
28 OF THE MUNICIPALITY INTO THE SYSTEM. IF THE DATE OF THE MEMBER'S
29 SEPARATION FROM MILITARY SERVICE IS PRIOR TO THE DATE ON WHICH
30 THE MUNICIPALITY JOINED THE SYSTEM, THEN THE CREDIT PURCHASED
19730S0471B1162 - 41 -
1 SHALL BE CONSIDERED AS PRIOR SERVICE CREDIT. IN THIS CASE THE
2 AMOUNT DUE FROM THE MEMBER SHALL BE COMPUTED BY APPLYING THE
3 MEMBER'S BASIC CONTRIBUTION RATE PLUS THE RATE OF CONTRIBUTION
4 THE MUNICIPALITY PAID FOR CURRENT SERVICE DURING ITS FIRST YEAR
5 OF ENTRY INTO THE SYSTEM TO HIS PRIOR SALARY AND MULTIPLYING THE
6 RESULT BY THE NUMBER OF YEARS AND FRACTIONAL PART OF A YEAR OF
7 CREDITABLE NONINTERVENING MILITARY SERVICE, PLUS INTEREST FROM
8 THE DATE OF THE MEMBER'S EMPLOYMENT BY THE MUNICIPALITY TO THE
9 DATE OF PURCHASE. THE AMOUNT DUE FROM THE MEMBER SHALL BE
10 CERTIFIED BY THE BOARD IN ACCORDANCE WITH METHODS APPROVED BY
11 THE ACTUARY, AND MAY BE PAID IN A LUMP SUM WITHIN THIRTY DAYS OR
12 IT MAY BE AMORTIZED WITH ADDITIONAL INTEREST THROUGH SALARY
13 DEDUCTIONS IN AMOUNTS AGREED UPON BY THE MEMBER AND THE BOARD.
14 IF, ON THE OTHER HAND, THE DATE OF THE MEMBER'S SEPARATION FROM
15 MILITARY SERVICE IS LATER THAN THE DATE OF ENTRY OF THE
16 MUNICIPALITY INTO THE SYSTEM, THEN THE CREDIT PURCHASED SHALL BE
17 CONSIDERED AS CURRENT SERVICE CREDIT. IN THIS CASE THE AMOUNT
18 DUE FROM THE MEMBER SHALL BE COMPUTED BY APPLYING THE MEMBER'S
19 BASIC CONTRIBUTION RATE PLUS THE MUNICIPALITY'S NORMAL
20 CONTRIBUTION RATE FOR CURRENT SERVICE WHICH WAS IN EFFECT ON THE
21 DATE OF THE MEMBER'S ENTRY INTO EMPLOYMENT WITH THE MUNICIPALITY
22 TO HIS AVERAGE ANNUAL RATE OF COMPENSATION OVER THE FIRST FIVE
23 YEARS OF HIS SUBSEQUENT EMPLOYMENT AND MULTIPLYING THE RESULT BY
24 THE NUMBER OF YEARS AND FRACTIONAL PART OF A YEAR OF CREDITABLE
25 NONINTERVENING MILITARY SERVICE BEING PURCHASED, PLUS INTEREST
26 FROM THE DATE OF EMPLOYMENT BY THE MUNICIPALITY TO DATE OF
27 PURCHASE.
28 THE AMOUNT DUE FROM THE MEMBER SHALL BE CERTIFIED BY THE
29 BOARD IN ACCORDANCE WITH METHODS APPROVED BY THE ACTUARY, AND
30 MAY BE PAID IN A LUMP SUM WITHIN THIRTY DAYS OR IT MAY BE
19730S0471B1162 - 42 -
1 AMORTIZED WITH ADDITIONAL INTEREST THROUGH SALARY DEDUCTIONS IN
2 AMOUNTS AGREED UPON BY THE MEMBER AND THE BOARD.
3 THE RATE OF INTEREST TO BE CHARGED TO MEMBERS ON THEIR
4 PURCHASE OF CREDIT FOR INTERVENING OR NONINTERVENING MILITARY
5 SERVICE SHALL BE THE RATE BEING CREDITED BY THE SYSTEM TO
6 MEMBER'S CONTRIBUTION ACCOUNTS IN EFFECT ON THE DATE OF THE
7 MEMBER'S APPLICATION, COMPOUNDED ANNUALLY.
8 A MEMBER MAY PURCHASE CREDIT FOR INTERVENING OR
9 NONINTERVENING MILITARY SERVICE ONLY IF HIS DISCHARGE OR
10 SEPARATION FROM THE SERVICE WAS GRANTED UNDER OTHER THAN
11 DISHONORABLE CONDITIONS.
12 A MEMBER MAY NOT PURCHASE CREDIT FOR ANY MILITARY SERVICE FOR
13 WHICH HE IS ENTITLED TO RECEIVE A RETIREMENT ALLOWANCE FROM THE
14 UNITED STATES GOVERNMENT.
15 APPLICATIONS FOR PERMISSION TO PURCHASE CREDIT FOR MILITARY
16 SERVICE MUST BE ACCOMPANIED BY PROOF OF THE NATURE OF HIS
17 DISCHARGE OR SEPARATION FROM THE MILITARY SERVICE.
18 Section 306. Determination of Municipal Liability.--The
19 actuary shall, as soon as may be, determine the present value of
20 the liability of each municipality for the prior service credits
21 to its original members, and shall establish an amount payable
22 annually over a period not exceeding thirty years, through which
23 payments such prior service liability may be funded. Each
24 municipality shall have the option to spread the payment of such
25 prior service liability over such period of years.
26 The municipal liability to be determined by the actuary shall
27 be based upon credit for all years of prior service toward the
28 municipal annuity of each original member.
29 The actuary shall also determine, from time to time, the
30 amount which shall be contributed annually by each municipality,
19730S0471B1162 - 43 -
1 for service credits of original and new members subsequent to
2 the time the municipality joined the system, and the additional
3 amount which shall be contributed annually by each municipality
4 toward a reserve account for disability allowances payable to
5 original and new members, in order that all future service
6 liability may be fully funded on an actuarial basis.
7 The amounts so determined by the actuary may be expressed in
8 a percentage of payroll of the municipality covering its
9 contributing members.
10 The payments made by the State Treasurer to the treasurer of
11 the municipality from moneys received from taxes paid upon
12 premiums by foreign fire insurance companies for purposes of
13 pension, retirement or disability benefits for municipal firemen
14 shall be used as follows: (i) to reduce the unfunded liability
15 or, after such liability has been funded, (ii) to apply against
16 the annual obligation of the municipality for future service and
17 disability reserve costs. It shall be the duty of the governing
18 body to apply such payments in accordance with the provisions of
19 this act.
20 The payments made by the State Treasurer to the treasurer of
21 the municipality from the moneys received from taxes paid upon
22 premiums by foreign casualty insurance companies for purposes of
23 pension, retirement or disability benefits for municipal
24 policemen shall be used as follows: (i) to reduce the unfunded
25 liability or, after such liability has been funded, (ii) to
26 apply against the annual obligation of the municipality for
27 future service and disability reserve costs. It shall be the
28 duty of the governing body to apply such payments in accordance
29 with the provisions of this act.
30 The cost of making the valuations required by this section
19730S0471B1162 - 44 -
1 and in the transfer of any existing pension system of any
2 municipality, shall be part of the costs of administration of
3 this act.
4 Section 307. Contributions by Members; Consolidation of
5 Credits.--Each single coverage member of the system created
6 under this Article III, shall be required to contribute to the
7 fund such per cent of his actual salary or compensation as shall
8 be computed by the actuary to be approximately sufficient to
9 procure for him on superannuation retirement, a member's annuity
10 of approximately one one-hundredth of his final salary for each
11 year of service after the time the municipality by which he is
12 employed joined the system. The member shall not be required to
13 contribute more than eight per cent of his salary or
14 compensation to the fund.
15 The amount of contribution by each joint coverage member
16 shall be computed in the manner described above for a single
17 coverage member, except that the amount of such deductions from
18 salary or compensation shall be reduced with respect to wages
19 (as defined in the Federal Insurance Contributions Act) by forty
20 per cent of the tax on employes prescribed by the Federal
21 Insurance Contributions Act exclusive of that portion of such
22 tax attributable to disability coverage.
23 Members' contributions shall be paid into the fund by the
24 municipality through payroll deductions in such manner and at
25 such time as the board may by rule and regulation determine.
26 Section 308. Withdrawal; Return to Service; Death in
27 Service.--(a) Should a contributor, before reaching
28 superannuation retirement age, for any reason cease to be a
29 municipal fireman or a municipal policeman, he shall be paid by
30 the board the full amount of the accumulated deductions standing
19730S0471B1162 - 45 -
1 to his credit in the member's account, unless he is entitled to
2 vesting rights or to a retirement allowance for retirement not
3 voluntarily, and elects to exercise such vesting rights or take
4 such retirement allowance. Should such former contributor
5 thereafter return to the service of the same municipality and
6 restore to the fund, in such manner as may be agreed upon by
7 such person and the board, his withdrawn accumulated deductions
8 as they were at the time of his separation from service, his
9 annuity rights as they existed at the time of separation from
10 service shall be restored and his obligations as a member shall
11 begin again.
12 (b) Should a contributor, having attained or passed
13 superannuation age, elect, upon leaving the service of the
14 municipality, not to claim the retirement allowance to which he
15 is entitled, he shall, upon written application, be paid by the
16 board the full amount of the accumulated deductions standing to
17 his credit in the member's account.
18 (c) Should a person who has been retired on a retirement
19 allowance under this act, return to employment on a regular
20 full-time basis in the same municipality, his retirement
21 allowance shall cease, and all his rights as they existed at the
22 time of retirement shall be restored, and such person may by
23 further service and further payroll deductions add to such
24 rights on account of future retirement. For the purposes of this
25 section if a person is reemployed on a temporary or seasonal
26 basis and his gross post-retirement earnings from such
27 reemployment during the calendar year are less than two thousand
28 one hundred dollars ($2,100) or such other maximum as the board
29 may establish, he shall not be deemed reemployed, but if and
30 when his gross post-retirement earnings exceed two thousand one
19730S0471B1162 - 46 -
1 hundred dollars ($2,100) or such other maximum as the board may
2 establish in any calendar year he shall not be entitled to
3 receive his retirement allowance for that month or any
4 subsequent month in the calendar year in which he continues in
5 service. The municipality is required to notify the board
6 immediately of the reemployment status of any retired former
7 employe and file separate monthly reports of his gross earnings
8 as prescribed by the board.
9 (d) Should a contributor die while in service, prior to
10 become eligible for a retirement allowance, his accumulated
11 deductions shall be paid to his estate, or to such person, if
12 living, as he shall have designated, in writing, filed with the
13 board as his beneficiary. In case any contributor has failed to
14 designate a beneficiary, or if the named beneficiary has
15 predeceased the member and no successor beneficiary has been
16 named, and upon the death in service shall have less than one
17 hundred dollars ($100) in accumulated deductions standing to his
18 credit, the board may, if letters testamentary or of
19 administration have not been taken out on his estate within six
20 months after his death, pay such accumulated deductions on the
21 claim of the undertaker, or to such person or municipality which
22 shall have paid the claim of the undertaker.
23 Section 309. Superannuation Retirement.--Retirement for
24 superannuation shall be as follows:
25 (1) Any contributor who has reached superannuation
26 retirement age may retire for superannuation by filing with the
27 board a written statement, duly attested, setting forth on what
28 date he desires to be retired. Said application shall make the
29 superannuation retirement allowance effective on the date so
30 specified, if such application was filed in the office of the
19730S0471B1162 - 47 -
1 board or deposited in the United States mail, addressed to the
2 board, before the date specified in the application and before
3 the death of the contributor, but the date so specified in the
4 application shall not be more than ninety days after the date of
5 filing, or the date the application was deposited in the mail.
6 (2) On retirement for superannuation, a contributor shall be
7 entitled to a retirement allowance throughout his life, which
8 shall consist of (i) a member's annuity of equivalent actuarial
9 value to his accumulated deductions, and (ii) a municipal
10 annuity which shall be equal to, for current service, one one-
11 hundredth of his final salary for each year of service while a
12 member, and, in addition thereto for prior service in the case
13 of an original member, one one-hundredth of his prior salary for
14 each year of prior service.
15 (3) The superannuation retirement allowance provided in this
16 section or the withdrawal allowance provided in section 311, as
17 the case may be, payable to a joint coverage member after the
18 age at which social security old age insurance benefits become
19 payable shall be reduced by an amount equal to forty per cent of
20 the primary insurance amount of social security paid or payable
21 to him. Such reduction shall be subject to the following
22 provisions: (i) the reduction in benefits in accordance with
23 this clause (3) shall not be applied in the case of an annuitant
24 until age sixty-five, unless such annuitant shall have elected
25 to receive social security benefits prior to age sixty-five,
26 (ii) the eligibility of such member for the old age insurance
27 benefit (primary insurance amount) and the amount of such old
28 age insurance benefit upon which the reduction in his allowance
29 shall be based, shall be determined by the board in accordance
30 with the provisions of the Federal Social Security Act, in
19730S0471B1162 - 48 -
1 effect on the effective date of superannuation retirement, or
2 withdrawal, of the member, except that in determining such
3 eligibility and such amount only wages or compensation for
4 service covered by the system shall be included, (iii) the
5 reduction in benefits in accordance with this clause (3) shall
6 apply only to that portion of benefits based on wages as defined
7 in the Federal Insurance Contribution Act,(iv) the reduction of
8 benefits in accordance with this clause (3) shall be limited to
9 the municipal annuity calculated in accordance with clause (2)
10 of this section, (v) the total sum including social security old
11 age insurance benefits to be received upon superannuation
12 retirement or withdrawal by a joint coverage member shall not be
13 less than the allowance that he would be paid as a single
14 coverage member, (vi) whenever the amount of the reduction from
15 the superannuation retirement allowance or the withdrawal
16 allowance shall have been once determined, it shall remain fixed
17 for the duration of the allowance, except that any decrease in
18 the old age insurance benefit under the Federal Social Security
19 Act shall result in a corresponding decrease in the amount of
20 the reduction in the allowance, (vii) the reduction provided for
21 in this clause (3) shall not apply to disability allowances
22 payable under section 313 of this act.
23 (4) In no event shall the municipal annuity exceed fifty per
24 cent of the contributor's final salary.
25 (5) Other provisions of this act notwithstanding, any member
26 of a police force who was a member of a pension fund created
27 under the provisions of the act of May 29, 1956 (P.L.1804,
28 No.600), and who was entitled to retire at the age of fifty-five
29 or sixty years after twenty years of total service, or at the
30 age of fifty or fifty-five after twenty-five years of service,
19730S0471B1162 - 49 -
1 and to receive the pension provided by that act, shall have the
2 same entitlement under the system created pursuant to this act.
3 The municipal annuity, computed under subclause (ii) of clause
4 (3) above, shall be increased as needed, in addition to the
5 member's annuity, in order to pay any increased retirement
6 allowance resulting from the provisions of the act.
7 Section 310. Death Benefits.--(a) A contributor to the
8 system who is entitled to a superannuation retirement allowance
9 by reason of having reached superannuation retirement age or who
10 is entitled to a withdrawal allowance by reason of having
11 completed twenty-four years of total service, may file with the
12 board a written application for retirement in the form required
13 for such application, but requesting that such retirement shall
14 become effective as of the time of his death, electing one of
15 the options provided in section 312 of this act and nominating a
16 person having an insurable interest in his life under said
17 option as required in said section. In all such cases, the
18 application shall be held by the board until the contributor
19 shall file a later application in the usual manner for a
20 superannuation retirement allowance or until the death of the
21 contributor occurring while in the municipal service, at which
22 time his retirement shall become effective with the same
23 benefits to the person designated as if the contributor had
24 retired on the day immediately preceding his death.
25 (b) A contributor to the system who is entitled to a
26 superannuation retirement allowance by reason of having reached
27 superannuation retirement age or who is entitled to a withdrawal
28 allowance by reason of having completed twenty-four years of
29 service and who has died in municipal service before filing with
30 the board a written application for a superannuation retirement
19730S0471B1162 - 50 -
1 allowance as provided in subsection (a) of this section shall be
2 considered as having elected Option 1 as provided in section 312
3 as of the date of his death. In such event, payment under Option
4 1 shall be made to the beneficiary designated in the nomination
5 of beneficiary form on file with the board, or if said
6 beneficiary has predeceased the contributor, to the legal
7 representative of said contributor.
8 Section 311. Early Retirement.--Should a contributor be
9 discontinued from service not voluntarily after having completed
10 eight years of total service, or voluntarily after having
11 completed twenty-four years of total service, but in either
12 event before reaching superannuation retirement age, he shall be
13 paid as he may elect, as follows:
14 (1) The full amount of his accumulated deductions standing
15 to his credit in the member's account of the fund; or
16 (2) Upon the filing of an application in the manner outlined
17 in section 309 (a) a retirement allowance which shall consist of
18 (i) a member's annuity of equivalent actuarial value to his
19 accumulated deductions, and (ii) a municipal annuity of
20 equivalent actuarial value to the present value of a municipal
21 annuity, beginning at superannuation retirement age, calculated
22 in accordance with the provisions of section 309; or
23 (3) If qualified, a deferred retirement allowance as
24 provided in section 314.
25 Section 312. Options on Superannuation or Early
26 Retirement.--At the time of his superannuation or early
27 retirement, a contributor may elect to receive his benefits in a
28 retirement allowance payable throughout his life, which shall be
29 known as a single life annuity, or instead, he may elect, to
30 receive the actuarial equivalent value at that time of his
19730S0471B1162 - 51 -
1 retirement allowance in a lesser allowance, payable throughout
2 life with provisions that:
3 (1) Option 1. If he shall die before receiving in payments
4 the present value of his retirement allowance as it was at the
5 time of his retirement, the balance, if less than five thousand
6 dollars ($5,000) shall be paid in a lump sum to his legal
7 representative, or to or in trust for his beneficiary. If the
8 balance is five thousand dollars ($5,000) or more, the
9 beneficiary may elect by application duly acknowledged and filed
10 with the board to receive payment of such balance according to
11 any of the following provisions: (i) a lump sum payment, (ii) an
12 annuity having a present value equal to the balance payable,
13 (iii) a lump sum payment and an annuity. Such annuity shall be
14 of equivalent actuarial value to the balance payable less the
15 amount of the lump sum payment specified by the beneficiary.
16 (2) Option 2. Upon his death his retirement allowance shall
17 be continued throughout the life of and paid to his survivor
18 annuitant, if then living.
19 (3) Option 3. Upon his death, one-half of his retirement
20 allowance shall be continued throughout the life of and paid to
21 his survivor annuitant, if then living.
22 Section 313. Disability Retirement.--(a) After a contributor
23 has had ten or more years of total service, he may, upon
24 application or on application of one acting in his behalf, or
25 upon application of a head of the department of the municipality
26 by which he is employed, be retired by the board on a disability
27 allowance if he is under superannuation retirement age, and on a
28 superannuation retirement allowance if he has attained or passed
29 such age, if the physician designated by the board, after
30 medical examination of the contributor made at the place of
19730S0471B1162 - 52 -
1 residence of the contributor or at a place mutually agreed upon,
2 shall certify to the board that the contributor is unable to
3 engage in any gainful employment and that said contributor ought
4 to be retired. When the disability of a contributor is
5 determined to be service-connected, as defined in this act, no
6 minimum period of service shall be required for eligibility.
7 Application filing requirements shall be identical to those
8 outlined in clause (1) of section 309.
9 (b) On retirement for disability, a member shall receive a
10 retirement allowance which shall consist of:
11 (1) A member's annuity of equivalent actuarial value to his
12 accumulated deductions;
13 (2) A municipal annuity of equivalent actuarial value to the
14 present value of a municipal annuity, beginning at
15 superannuation retirement age, calculated in accordance with the
16 provisions of section 309; and
17 (3) A disability annuity payable from the total disability
18 reserve account which, together with the member's annuity and
19 the municipal annuity, shall be sufficient to produce a
20 retirement allowance of thirty per cent of the contributor's
21 final salary. Where the disability of the member is determined
22 to be service-connected, as defined in this act, the retirement
23 allowance shall equal fifty per cent of his final salary. The
24 disability annuity shall be reduced by the amount of any
25 payments for which the member shall be eligible under the act of
26 June 2, 1915 (P.L.736, No.338), known as "The Pennsylvania
27 Workmen's Compensation Act," or the act of June 21, 1939
28 (P.L.566, No.284), known as "The Pennsylvania Occupational
29 Disease Act."
30 (c) Once every year the board may require any disability
19730S0471B1162 - 53 -
1 annuitant, while still under superannuation retirement age, to
2 undergo medical examination by a physician designated by the
3 board, and such examination shall be made at the place of
4 residence of the annuitant or other place mutually agreed upon.
5 Should the physician report and certify to the board that such
6 disabled annuitant is no longer physically or mentally
7 incapacitated for the performance of duty and is able to engage
8 in a gainful occupation, then his disability retirement
9 allowance shall be discontinued, and in lieu thereof an early
10 involuntary retirement allowance shall at that time be granted
11 as if such person had been retired not voluntarily, if such
12 person shall have eight or more years of total service.
13 (d) Should a disability annuitant, while under
14 superannuation retirement age, refuse to submit to at least one
15 medical examination in any year by a physician designated by the
16 board, his disability retirement allowance shall be discontinued
17 until withdrawal of such refusal, and should such refusal
18 continue for one year, then all his rights in and to any
19 disability retirement allowance or for early involuntary
20 retirement allowance provided by this act shall be forfeited.
21 (e) Any contributor entitled to retire for disability may,
22 in lieu of such retirement, if he has eight or more years of
23 total service, elect to retire not voluntarily under the
24 provisions of this act.
25 (f) Should a disability annuitant die before the total
26 disability retirement allowance received shall be at least equal
27 to the amount of his accumulated deductions at the time of
28 disability retirement, then the board shall pay to the named
29 beneficiary, if living, or if the named beneficiary predeceased
30 the annuitant, or no beneficiary was named, then to the
19730S0471B1162 - 54 -
1 annuitant's estate, an amount equal to the difference between
2 such total retirement allowance received and the annuitant's
3 accumulated deductions, and if such difference is less than one
4 hundred dollars ($100) and no letters have been taken out on the
5 estate within six months after death, then such difference may
6 be paid to the undertaker or to any person or municipality who
7 or which shall have paid the claim of the undertaker.
8 Section 314. Vesting.--(a) Should a contributor, before
9 reaching superannuation retirement age and after having
10 completed twelve years of total service, for any reason cease to
11 be a municipal fireman or a municipal policeman, he shall be
12 entitled to vest his retirement benefits until he attains
13 superannuation retirement age, by filing with the board a
14 written notice of his intentions to vest, within ninety days of
15 the date of his termination.
16 (b) A contributor, who was terminated not voluntarily, may
17 elect, after he has vested, to be paid as follows:
18 (1) The full amount of the accumulated deductions, including
19 interest to the date of termination, standing to his credit in
20 the member's account of the fund; or
21 (2) An early retirement allowance as computed under the
22 provisions of clause (2) of section 311; or
23 (3) Upon reaching superannuation retirement age, a
24 superannuation retirement allowance as computed under the
25 provisions of section 309.
26 (c) A contributor, who voluntarily terminated his service,
27 may elect, after he has vested, to be paid as follows:
28 (1) The full amount of the accumulated deductions, including
29 interest to the date of termination, standing to his credit in
30 the member's account of the fund; or
19730S0471B1162 - 55 -
1 (2) If the contributor has completed twenty-four years or
2 more of total service, a voluntary withdrawal allowance computed
3 in accordance with the provisions of section 311; or
4 (3) Upon reaching superannuation retirement age, a
5 superannuation retirement allowance as computed under the
6 provisions of section 309.
7 (d) Should a contributor, who has vested, die before he
8 becomes eligible for a retirement allowance, the full amount of
9 the accumulated deductions, including interest to the date of
10 his termination, standing to his credit in the member's account
11 of the fund shall be paid to his estate or to his named
12 beneficiary in accordance with the provisions of subsection (d)
13 of section 308.
14 Section 315. Compliance.--When a municipality joins the
15 system, its action shall be construed as compliance with the
16 provisions of the act of May 29, 1956 (P.L.1804, No.600), or any
17 other statute requiring the creation of a pension or retirement
18 system for firemen or police.
19 Section 316. Withdrawal Provisions.--No municipality, after <--
20 it has joined the system under the provisions of this Article
21 III, shall be permitted to withdraw therefrom, except as
22 hereinafter provided, and in any case of failure to make
23 payments as required by this act, the Commonwealth shall withold
24 payments to the municipality of any funds to which the
25 municipality may be entitled for pension purposes. The board may
26 recover any sums due to the fund by suit at law or other
27 appropriate remedy. Any municipality may withdraw from the
28 retirement system if (i) the fire department or the police
29 department is abolished, or (ii) if the municipality is
30 completely annexed by or consolidated with another municipality,
19730S0471B1162 - 56 -
1 or (iii) if an ordinance signifying an intention to withdraw is
2 approved by an affirmative vote of seventy-five per cent of the
3 entire membership of the municipal legislative body: Provided,
4 That where the legislative body consist of only three persons,
5 the ordinance or resolution shall be approved by a unanimous
6 vote: And provided further, That in the case of (iii) the
7 withdrawal ordinance shall not become effective without the
8 affirmative vote of seventy-five per cent of the municipal
9 firemen or the municipal police, as the case may be, affected by
10 the ordinance.
11 In any such withdrawal, the election to withdraw shall be
12 deemed to have been made at the time the municipality elected to
13 withdraw or the members approved the withdrawal, as the case may
14 be, and the liabilities of the municipality and the rights and
15 privileges of the members shall be fixed accordingly. No member
16 who becomes entitled to a benefit or who is receiving a benefit
17 under the provisions of this act shall be deprived of or lose
18 such benefit as a result of such withdrawal.
19 When a municipality elects to withdraw from the system
20 created by this Article III, by an ordinance approved by
21 seventy-five per cent or more of the entire membership, of its
22 governing body, and such withdrawal is approved by an
23 affirmative vote of seventy-five per cent of the municipal
24 firemen or the municipal police of such municipality, as the
25 case may be, the municipality shall, at the time of its election
26 to withdraw, again be subject to any act of the General Assembly
27 of this Commonwealth which requires the creation of a pension or
28 retirement system for firemen or police. In any such withdrawal,
29 provisions shall be made to credit to the accumulated deductions
30 of each member at least the amount he has paid into the member's
19730S0471B1162 - 57 -
1 account of the retirement fund created by this act, which moneys
2 shall be transferred to and credited to his account in a
3 retirement or pension fund established by the municipality after
4 its withdrawal from the system created by this Article III.
5 No liability, on account of retirement or disability
6 allowance being paid from the fund, shall attach against the
7 fund unless the board specifically agrees to accept such
8 liability, in which case adequate reserves, as determined by the
9 board, shall be retained in the fund to continue such payments.
10 If the board does not agree to accept liability to continue the
11 payment of such allowances, the liability shall attach against
12 the municipality and be paid from funds transferred to a
13 retirement system established subsequent to its withdrawal from
14 the system or from moneys appropriated annually from tax
15 revenues sufficient to pay the same.
16 SECTION 316. WITHDRAWAL PROVISIONS.--AT ANY TIME WITHIN <--
17 THREE YEARS AFTER A MUNICIPALITY HAS INITIALLY JOINED THE
18 RETIREMENT SYSTEM CREATED OR CONTINUED UNDER THIS ARTICLE III IT
19 MAY WITHDRAW FROM THE SYSTEM IF IT HAS MET ALL OF ITS FINANCIAL
20 OBLIGATIONS TO THE FUND. THE MEMBER'S CONTRIBUTIONS OF THE
21 WITHDRAWING MUNICIPALITY'S EMPLOYES SHALL BE RETURNED TO THE
22 MEMBERS. NO REFUND OF ANY CONTRIBUTIONS PAID BY THE MUNICIPALITY
23 SHALL BE MADE AND THESE MONEYS SHALL REMAIN IN THE PENNSYLVANIA
24 MUNICIPAL RETIREMENT FUND FOR THE BENEFIT OF THE REMAINING
25 MEMBERS. ANY SUCH WITHDRAWAL MUST BE EFFECTED THROUGH AN
26 ORDINANCE OR RESOLUTION CONTAINING THE AFFIRMATIVE VOTE OF
27 SEVENTY-FIVE PER CENT OF ALL OF THE MEMBERS OF ITS LEGISLATIVE
28 BODY AND IF THE LEGISLATIVE BODY IS COMPOSED OF ONLY THREE
29 PERSONS, THEN BY AN UNANIMOUS AFFIRMATIVE VOTE. IN ALL CASES AN
30 AFFIRMATIVE VOTE APPROVING SUCH ACTION BY SEVENTY-FIVE PER CENT
19730S0471B1162 - 58 -
1 OF THE MUNICIPAL EMPLOYES AFFECTED BY THE ORDINANCE OR
2 RESOLUTION MUST BE CERTIFIED BY THE MUNICIPALITY TO THE BOARD.
3 THEREAFTER, NO MUNICIPALITY, AFTER IT HAS JOINED THE SYSTEM
4 UNDER THE PROVISIONS OF THIS ARTICLE III, SHALL BE PERMITTED TO
5 WITHDRAW THEREFROM, AND, IN THE CASE OF FAILURE TO MAKE PAYMENTS
6 AS REQUIRED BY THIS ACT, THE COMMONWEALTH SHALL WITHHOLD PAYMENT
7 TO THE MUNICIPALITY ANY FUNDS TO WHICH THE MUNICIPALITY MAY BE
8 ENTITLED FOR PENSION PURPOSES. THE BOARD MAY RECOVER ANY SUMS
9 DUE TO THE FUND BY SUIT AT LAW, OR OTHER APPROPRIATE REMEDY.
10 Section 317. Procedures for Amending Contracts.--Any
11 municipality which has joined the system under the provisions of
12 this Article III may, with the approval of the board, enter into
13 a contract with the board as outlined in Article IV of this act,
14 to increase any of the benefits enumerated in Article IV. The
15 board shall not enter into any contract with any municipality
16 which decreases benefits, nor shall it enter into any contract
17 with a municipality which provides for benefits in excess of or
18 minimum members contribution rates less than those available to
19 it under any other existing law pertaining to the establishment
20 of retirement systems for that class of municipality. Before the
21 board approves any such contract it shall first determine,
22 through its actuary, that the plan outlined in the contract is
23 actuarially sound. Any member municipality which elects to enter
24 into a contract for increased benefits which would result in an
25 increase in its employes contribution rates shall first obtain
26 the written consent of at least seventy-five per cent of its
27 then member employes. Additional costs for contracted increases
28 in benefits shall become the responsibility of the municipality
29 and/or the members as specified in the contract.
30 ARTICLE IV
19730S0471B1162 - 59 -
1 OPTIONAL RETIREMENT PLANS
2 Section 401. Purpose.--This article shall provide for the
3 enrollment of those municipalities in the Pennsylvania Municipal
4 Retirement System which want to offer retirement benefits to
5 their employes different from those available under Article II
6 and Article III of this act. It shall also provide for
7 increasing member benefits for municipalities formerly enrolled
8 under the provisions of Article II and Article III of this act.
9 Section 402. Compulsory and Optional Membership.--If a <--
10 SECTION 402. EXISTING LOCAL RETIREMENT SYSTEMS AND <--
11 COMPULSORY AND OPTIONAL MEMBERSHIP.--WHERE A MUNICIPALITY ELECTS
12 TO JOIN THE SYSTEM ESTABLISHED BY THIS ACT, AND IS THEN
13 MAINTAINING A RETIREMENT OR PENSION SYSTEM OR SYSTEMS COVERING
14 ITS EMPLOYES IN WHOLE OR IN PART, THOSE EMPLOYES SO COVERED, AND
15 EMPLOYES THEREAFTER ELIGIBLE TO JOIN SUCH PENSION SYSTEM, SHALL
16 NOT BECOME MEMBERS OF THE RETIREMENT SYSTEM ESTABLISHED BY THIS
17 ACT, UNLESS AT THE TIME THE MUNICIPALITY ELECTS TO JOIN THE
18 SYSTEM, THE MEMBERS OF SUCH EXISTING RETIREMENT OR PENSION
19 SYSTEM SHALL, BY THE AFFIRMATIVE VOTE OF SEVENTY-FIVE PER CENT
20 OF ALL THE MEMBERS THEREOF, ELECT TO BE COVERED BY THE
21 RETIREMENT SYSTEM ESTABLISHED BY THIS ACT. AT ANY TIME
22 THEREAFTER, WITHIN A PERIOD OF THREE YEARS AFTER THE
23 MUNICIPALITY HAS ELECTED TO JOIN THE SYSTEM, BUT NOT THEREAFTER,
24 THE MEMBERS OF AN EXISTING RETIREMENT OR PENSION SYSTEM MAY, IN
25 LIKE MANNER, ELECT TO JOIN THE SYSTEM ESTABLISHED BY THIS ACT.
26 IN ANY SUCH CASE, PROVISIONS MAY BE MADE FOR THE TRANSFER OF
27 MONEYS AND SECURITIES IN ITS RETIREMENT OR PENSION FUND OR
28 YEARS.
29 NO LIABILITY, ON ACCOUNT OF RETIREMENT ALLOWANCES OR PENSIONS
30 BEING PAID FROM ANY RETIREMENT OR PENSION FUND OF THE
19730S0471B1162 - 60 -
1 MUNICIPALITY, SHALL ATTACH AGAINST THE FUND, EXCEPT AS PROVIDED
2 IN THE AGREEMENT, MAKING A TRANSFER OF AN EXISTING SYSTEM IN
3 ACCORDANCE WITH THIS SECTION. THE LIABILITY TO CONTINUE PAYMENT
4 OF PENSIONS NOT SO TRANSFERRED SHALL ATTACH AGAINST THE
5 MUNICIPALITY, WHICH SHALL ANNUALLY MAKE APPROPRIATIONS FROM ITS
6 TAX REVENUES SUFFICIENT TO PAY THE SAME. IN CASES WHERE WORKERS
7 COVERED BY AN EXISTING RETIREMENT OR PENSION SYSTEM ELECT TO
8 JOIN THE SYSTEM CREATED BY THIS ACT, THE ELECTION TO JOIN SHALL
9 BE DEEMED TO HAVE BEEN MADE AT THE TIME THE MUNICIPALITY ELECTED
10 TO JOIN THE SYSTEM, AND THE LIABILITIES OF THE MUNICIPALITY
11 SHALL BE FIXED ACCORDINGLY.
12 IF A municipality elects to join the system under the
13 provisions of this Article IV, it shall first negotiate a
14 contract with the board, acceptable to both the municipality and
15 the board, which shall set forth all the specific details of
16 municipal and member contribution rates and benefits. The
17 municipality shall then pass an ordinance or resolution electing
18 to join the system, and confirming the terms of the contract by
19 reference thereto. Separate contracts and separate resolutions
20 shall be executed for each class of employes, namely municipal
21 employes, municipal firemen and municipal police in those cases
22 where the municipality elects to bring more than one class of
23 its employes into the system.
24 When a municipality elects to enroll its municipal employes
25 into the system, then each officer other than elected officers,
26 and each municipal employe thereof, employed on a permanent
27 basis, shall be required to become a member of the system. Each
28 municipality shall determine whether membership in said system
29 for elected officials and employes hired on a temporary or
30 seasonal basis shall be compulsory, optional or prohibited.
19730S0471B1162 - 61 -
1 Where membership may be optional with an elected officer or an
2 employe hired on a temporary or seasonal basis, an election to
3 join the system must be made within one year after the
4 municipality elected to join the system or within one year after
5 the officer or temporary or seasonal employe first entered the
6 service of the municipality. Officers and employes paid only on
7 a fee basis shall not be eligible to join the system.
8 When a municipality elects to enroll its municipal firemen or
9 its municipal police into the system, then each municipal
10 fireman or each municipal policeman, as defined in section 102
11 of this act, shall be required to become a member of the system.
12 When a municipality has established a policy of placing new
13 employes on a probationary status it may elect to refrain from
14 enrolling such employes into the system for a period of up to
15 six months from the date the probationary employe first entered
16 the service of the municipality. In such cases service credits
17 shall not be earned by the employe for probationary time served
18 prior to enrollment.
19 Section 403. Contract Provisions.--Any contract for an
20 optional retirement plan entered into between a municipality and
21 the board shall not provide for any benefits in excess of or
22 minimum member's contribution rates less than those available to
23 that municipality for that class of employes under any existing
24 law pertaining to the establishment of a retirement or pension
25 system.
26 The contract shall specifically state the following terms and
27 conditions:
28 (1) The superannuation retirement age at which a member
29 shall become eligible for a full normal retirement allowance in
30 accordance with the formula specified in the contract.
19730S0471B1162 - 62 -
1 (2) Length of service requirements which must be met before
2 a member becomes eligible for either a superannuation retirement
3 allowance, an early retirement allowance and the method of
4 determining any reduction factors involved in the computation of
5 the amount of the allowance because of retirement prior to
6 attaining superannuation age.
7 (3) Provisions for the refunding of accumulated deductions
8 to employes who leave the service of the municipality before
9 they become eligible for any type of retirement benefit and
10 whether or not the employe shall be entitled to interest earned
11 on contributions.
12 (4) Provisions relating to the types and amounts of
13 disability retirement benefits for which a member may become
14 eligible, and the qualifications therefore.
15 (5) The availability of any vesting or deferred benefits to
16 which a member may become entitled.
17 (6) A description of the amount and the manner in which a
18 member may qualify for any death benefits, both before and after
19 retirement, including any prescribed payments to widows or
20 children under eighteen years of age.
21 (7) The formula used to determine the amount of normal
22 retirement benefits, including an explanation of the salary or
23 compensation to be used in the computations, and a statement
24 concerning any social security offset provisions included in the
25 contract.
26 (8) A description of any optional methods of payment of
27 retirement allowances available to a member.
28 (9) Any provisions for cost-of-living increases, and
29 limitations thereon, which may be included.
30 (10) The manner in which the rate or rates of employe
19730S0471B1162 - 63 -
1 contributions shall be determined, together with any provisions
2 for additional voluntary contributions.
3 (11) The manner in which the rates of contribution from the
4 municipalities shall be determined.
5 (12) The manner in which costs for prior service for which
6 the municipality is willing to assume liability shall be
7 determined, with respect to both the municipality's share and
8 the member's share, if any.
9 (13) (13) THE MANNER IN WHICH CREDIT FOR ANY ALLOWABLE <--
10 MILITARY SERVICE SHALL BE DETERMINED AND THE MANNER IN WHICH
11 COSTS OF SERVICE SHALL BE PAID.
12 (14) Any other information which might have a bearing on the
13 costs or benefits of the retirement plan which might be required
14 by the board in the administration of the plan.
15 Section 404. Determination of Municipal Liability.--The
16 actuary shall, as soon as may be, determine the present value of
17 the liability of each municipality for any prior service credits
18 it has elected to extend to its original members, and shall
19 establish an amount payable annually over a period not exceeding
20 thirty years, through which payments such prior service
21 liability may be funded. Each municipality shall have the option
22 to spread the payment of such prior service liability over such
23 period of years.
24 The municipal liability to be determined by the actuary shall
25 be based upon credit for those years of prior service toward the
26 municipal annuity of each original member, for which the
27 municipality has agreed to pay, plus any liability for payment
28 of the member's contributions for the prior service or any
29 portion thereof of each original member which the municipality
30 has agreed to pay.
19730S0471B1162 - 64 -
1 The actuary shall also determine, from time to time, the
2 amount which shall be contributed annually by each municipality
3 for service credits of original and new members subsequent to
4 the time the municipality joined the system, and the additional
5 amount which shall be contributed annually by each municipality
6 toward a reserve account for disability allowance payable to
7 original and new members, in order that all future service
8 liability may be fully funded on an actuarial basis.
9 The amounts so determined by the actuary may be expressed in
10 a percentage of the payroll of the municipality covering its
11 contributing members.
12 The payments made by the State Treasurer to the treasurer of
13 the municipality from moneys received from taxes paid upon
14 premiums by foreign fire insurance companies for purposes of
15 pension, retirement or disability benefits for municipal firemen
16 shall be used as follows: (i) to reduce the unfunded liability
17 or, after such liability has been funded, (ii) to apply against
18 the annual obligation of the municipality for future service and
19 disability reserve costs, and (iii) to reduce member
20 contributions. It shall be the duty of the governing body to
21 apply such payments in accordance with the provisions of this
22 act.
23 The payments made by the State Treasurer to the treasurer of
24 the municipality from the moneys received from taxes paid upon
25 premiums by foreign casualty insurance companies for purposes of
26 pension, retirement or disability benefits for municipal
27 policemen shall be used as follows: (i) to reduce the unfunded
28 liability or, after such liability has been funded, (ii) to
29 apply against the annual obligation of the municipality for
30 future service and disability reserve costs, and (iii) to reduce
19730S0471B1162 - 65 -
1 member contributions. It shall be the duty of the governing body
2 to apply such payments in accordance with the provisions of this
3 act.
4 The cost of making the valuations required by this section
5 and in the transfer of any existing pension system of any
6 municipality, shall be part of the costs of administration of
7 this act.
8 Section 405. Contributions by Members; Consolidation of
9 Credits; Change of Employment.--Each member of the system shall
10 be required to contribute to the fund such per cent of his
11 actual salary or compensation, including fees where paid in part
12 on a fee basis, as specified in the contract, which
13 contributions shall be paid into the fund by the municipality
14 through payroll deductions in such manner and at such time as
15 the board may by rule and regulation determine.
16 If such provision is contained in the contract between the
17 municipality and the board, each member may increase his
18 member's annuity by electing to make such additional voluntary
19 contributions as prescribed therein.
20 When a member is employed by more than one municipality, he
21 shall be required to make contributions on account of his salary
22 paid by each municipality. In such cases the board shall provide
23 for the consolidation of credits of the contributor, and upon
24 his retirement, for a consolidated retirement allowance.
25 When a contributor leaves the employ of a municipality which
26 has joined the system, and enters into the employ of another
27 municipality which has also joined the system, his service
28 credits shall remain unimpaired, but in such cases any unpaid
29 municipal liability for prior service shall be prorated by the
30 board between the municipalities on an equitable basis.
19730S0471B1162 - 66 -
1 Section 406. Withdrawal; Return to Service; Death in
2 Service.--(a) Should a contributor, before reaching
3 superannuation retirement age, for any reason terminate his
4 employment with the municipality, he shall receive a refund of
5 his contributions in full, either with or without interest
6 earned as specified in the contract, unless he may be entitled
7 to a retirement allowance for early retirement, and elects to
8 take such retirement allowance. Should such former contributor
9 thereafter return to the service of the same municipality and
10 restore to the fund in such manner as may be agreed upon by such
11 person and the board, his withdrawn contributions as they were
12 at the time of his separation from service, his annuity rights
13 as they existed at the time of separation from service, shall be
14 restored and his obligations as a member shall begin again. The
15 rate of contribution of such returning member shall be the same
16 as it was at the time he separated from service.
17 (b) Should a contributor, having attained or passed
18 superannuation age, elect, upon leaving the service of the
19 member municipality, not to claim the retirement allowance to
20 which he is entitled, he shall, upon written application, be
21 paid by the board the full amount of his contributions standing
22 to his credit in the member's account, either with or without
23 interest earned as stipulated in the contract.
24 (c) Should a person who has been retired on a retirement
25 allowance under this act, return to employment on a regular
26 full-time basis in the same municipality, his retirement
27 allowance shall cease, and all his rights as they existed at the
28 time of retirement shall be restored, and such person may by
29 further service and further payroll deductions add to such
30 rights on account of future retirement. For the purposes of this
19730S0471B1162 - 67 -
1 section if a person is reemployed on a temporary or seasonal
2 basis and his gross post-retirement earnings from such
3 reemployment during the calendar year are less than two thousand
4 one hundred dollars ($2,100) or such other maximum as the board
5 may establish, he shall not be deemed reemployed, but if and
6 when his gross post-retirement earnings exceed two thousand one
7 hundred dollars ($2,100) or such other maximum as the board may
8 establish in any calendar year he shall not be entitled to
9 receive his retirement allowance for that month or any
10 subsequent month in the calendar year in which he continues in
11 service. The municipality is required to notify the board
12 immediately of the reemployment status of any retired former
13 employe and file separate monthly reports of his gross earnings
14 as prescribed by the board.
15 (d) Should a contributor die while in service, any death or
16 survivor benefits for which he may be eligible under the
17 provisions of the contract shall be paid in accordance with the
18 terms of the contract.
19 (e) Should a contributor die while in service, and before
20 becoming eligible for any other benefits contained in the
21 contract, the full amount of his contributions, either with or
22 without interest earned as stipulated in the contract, shall be
23 paid to his estate, or to such person, if living, as he shall
24 have designated in writing, filed with the board as his
25 beneficiary. In case any contributor has failed to designate a
26 beneficiary, or if the named beneficiary has predeceased the
27 member and no such successor beneficiary has been named, and
28 upon the death in service shall have less than one hundred
29 dollars ($100) in accumulated deductions standing to his credit,
30 the board may, if letters testamentary or of administration have
19730S0471B1162 - 68 -
1 not been taken out on his estate within six months after death,
2 pay such accumulated deductions on the claim of the undertaker,
3 or to any person or municipality which shall have paid the claim
4 of the undertaker.
5 Section 407. Superannuation Retirement.--Retirement for
6 superannuation shall be as follows:
7 (1) Any contributor who has reached superannuation
8 retirement age may retire for superannuation by filing with the
9 board a written statement, duly attested, setting forth on what
10 date he desires to be retired. Said application shall make the
11 superannuation retirement allowance effective on the date so
12 specified, if such application was filed in the office of the
13 board or deposited in the United States mail, addressed to the
14 board, before the date specified in the application and before
15 the death of the contributor, but the date so specified in the
16 application shall not be more than ninety days after the date of
17 filing, or the date the application was deposited in the mail.
18 (2) On retirement for superannuation, a contributor shall be
19 entitled to a retirement allowance throughout his life, which
20 shall consist of an amount computed in accordance with the
21 formula specified in the contract.
22 Section 408. Early Retirement.--Should a member be
23 discontinued from service not voluntarily, after having
24 completed a required number of years of total service, or
25 voluntarily after having completed a required number of years of
26 total service, but in either event before reaching
27 superannuation retirement age, he shall be paid, as he may
28 elect, as follows:
29 (1) The full amount of the accumulated deductions standing
30 to his credit in the member's account of the fund; or
19730S0471B1162 - 69 -
1 (2) The early retirement allowance, if any, specified in the
2 contract.
3 Section 409. Options on Superannuation or Early
4 Retirement.--At the time of his superannuation or early
5 retirement, a contributor may elect to receive his benefits in a
6 retirement allowance payable throughout his life, which shall be
7 known as a single life annuity, or instead, he may elect to
8 receive the actuarial equivalent at that time of his retirement
9 allowance in a lesser allowance, payable throughout life with
10 provisions that:
11 (1) Option 1. If he shall die before receiving in payments
12 the present value of his retirement allowance as it was at the
13 time of his retirement, the balance, if less than five thousand
14 dollars ($5,000), shall be paid in a lump sum to his legal
15 representative, or to or in trust for his beneficiary. If the
16 balance is five thousand dollars ($5,000) or more, the
17 beneficiary may elect by application duly acknowledged and filed
18 with the board to receive payment of such balance according to
19 any one of the following provisions: (i) a lump sum payment,
20 (ii) an annuity having a present value equal to the balance
21 payable, (iii) a lump sum payment and an annuity. Such annuity
22 shall be of equivalent actuarial value to the balance payable
23 less the amount of the lump sum payment specified by the
24 beneficiary.
25 (2) Option 2. Upon his death, his retirement allowance
26 shall be continued throughout the life of and paid to his
27 survivor annuitant, if then living.
28 (3) Option 3. Upon his death, one-half of his retirement
29 allowance shall be continued throughout the life of and paid to
30 his survivor annuitant, if then living.
19730S0471B1162 - 70 -
1 (4) Option 4. Any other optional form of payment contained
2 in the contract.
3 Section 410. Vesting.--Provisions for vesting may be
4 included in the contract between the municipality and the board.
5 When such provision is made it shall mean that a contributor who
6 terminates his employment with the municipality after a
7 stipulated age or length of service, or both, may, if he so
8 elects in writing, leave his contributions, as credited to his
9 account, in the fund, and, upon reaching superannuation
10 retirement age, receive a superannuation retirement allowance.
11 Section 411. Disability Retirement.--(a) After a member has
12 had the required number of years of total service as stated in
13 the contract, he may, upon application or on the application of
14 one acting in his behalf, or upon application of a head of the
15 department of the municipality by which he is employed, be
16 retired by the board on a disability allowance if he is under
17 superannuation retirement age, and on a superannuation
18 retirement allowance if he has attained or passed such age, if
19 the physician designated by the board, after medical examination
20 of the member made at the place of residence of the member or at
21 a place mutually agreed upon, shall certify to the board that
22 the member is unable to engage in any gainful employment and
23 that said member ought to be retired. Where the disability of a
24 member is determined to be service-connected, as defined in this
25 act, no minimum period of service shall be required for
26 eligibility. Requirements for filing applications shall be
27 identical to those outlined in clause (1) of section 407.
28 (b) On retirement for disability a member shall receive a
29 retirement allowance which shall consist of an amount computed
30 in accordance with the formula specified in the contract.
19730S0471B1162 - 71 -
1 (c) Once every year the board may require any disability
2 annuitant, while still under superannuation retirement age, to
3 undergo medical examination by a physician designated by the
4 board. Such examination shall be made at the place of residence
5 of the beneficiary or other place mutually agreed upon. Should
6 the physician report and certify to the board that such
7 disability beneficiary is no longer physically or mentally
8 incapacitated for the performance of duty and is able to engage
9 in a gainful occupation, then his disability retirement
10 allowance shall be discontinued, and in lieu thereof an early
11 involuntary retirement allowance shall at that time be granted
12 as if such person had been retired not voluntarily, if such a
13 provision is included in the contract and if such person shall
14 have had the required number of years of total service as stated
15 in the contract.
16 (d) Should a disability annuitant, while under
17 superannuation retirement age, refuse to submit to at least one
18 medical examination in any year by a physician designated by the
19 board, his disability retirement allowance shall be discontinued
20 until the withdrawal of such refusal, and should such refusal
21 continue for one year, then all his right in and to any
22 disability retirement allowance or for early involuntary
23 retirement allowance provided for by this act, shall be
24 forfeited.
25 (e) Any contributor entitled to retire for disability may,
26 in lieu of such retirement, if he has a required number of years
27 of total service, elect to retire not voluntarily under the
28 provisions of this act if such provisions are included in the
29 contract.
30 (f) Should a disability annuitant die before the total
19730S0471B1162 - 72 -
1 disability retirement allowance received shall be at least equal
2 to the amount of the credit in his member's account at the time
3 of disability retirement, then the board shall pay to the named
4 beneficiary, if living, or if the beneficiary predeceased the
5 annuitant, or no beneficiary was named, then to the annuitant's
6 estate, an amount equal to the difference between such total
7 retirement allowance received and the annuitant's accumulated
8 deductions, and if such difference is less than one hundred
9 dollars ($100) and no letters have been taken out on the estate
10 within six months after death, then such difference may be paid
11 to the undertaker or to any person or municipality who or which
12 shall have paid the claim of the undertaker. If the contract
13 between the municipality and the board provides that upon the
14 death of a disability annuitant payments in a specific amount
15 shall be continued to certain beneficiaries, then the provisions
16 of subsection (f), above, shall not apply and payments shall be
17 made in accordance with the terms of the contract.
18 Section 412. Withdrawal Prohibited.--No municipality, after <--
19 it has joined the system under the provisions of this Article
20 IV, shall be permitted to withdraw therefrom, and, in the case
21 of failure to make payments as required by this act, the
22 Commonwealth shall withhold payments to the municipality of any
23 funds to which the municipality may be entitled for pension
24 purposes. The board may recover any sums due to the fund by suit
25 at law, or other appropriate remedy.
26 SECTION 412. WITHDRAWAL PROVISIONS.--AT ANY TIME WITHIN <--
27 THREE YEARS AFTER A MUNICIPALITY HAS INITIALLY JOINED THE
28 RETIREMENT SYSTEM CREATED UNDER THIS ARTICLE IV IT MAY WITHDRAW
29 FROM THE SYSTEM IF IT HAS MET ALL OF ITS FINANCIAL OBLIGATIONS
30 TO THE FUND. THE MEMBER'S CONTRIBUTIONS OF THE WITHDRAWING
19730S0471B1162 - 73 -
1 MUNICIPALITY'S EMPLOYES SHALL BE RETURNED TO THE MEMBERS. NO
2 REFUND OF ANY CONTRIBUTIONS PAID BY THE MUNICIPALITY SHALL BE
3 MADE AND THESE MONEYS SHALL REMAIN IN THE PENNSYLVANIA MUNICIPAL
4 RETIREMENT FUND FOR THE BENEFIT OF THE REMAINING MEMBERS. ANY
5 SUCH WITHDRAWAL MUST BE EFFECTED THROUGH AN ORDINANCE OR
6 RESOLUTION CONTAINING THE AFFIRMATIVE VOTE OF SEVENTY-FIVE PER
7 CENT OF ALL OF THE MEMBERS OF ITS LEGISLATIVE BODY AND IF THE
8 LEGISLATIVE BODY IS COMPOSED OF ONLY THREE PERSONS, THEN BY AN
9 UNANIMOUS AFFIRMATIVE VOTE. IN ALL CASES AN AFFIRMATIVE VOTE
10 APPROVING SUCH ACTION BY SEVENTY-FIVE PER CENT OF THE MUNICIPAL
11 EMPLOYES AFFECTED BY THE ORDINANCE OR RESOLUTION MUST BE
12 CERTIFIED BY THE MUNICIPALITY TO THE BOARD.
13 THEREAFTER, NO MUNICIPALITY, AFTER IT HAS JOINED THE SYSTEM
14 UNDER THE PROVISIONS OF THIS ARTICLE IV, SHALL BE PERMITTED TO
15 WITHDRAW THEREFROM, AND, IN THE CASE OF FAILURE TO MAKE PAYMENTS
16 AS REQUIRED BY THIS ACT, THE COMMONWEALTH SHALL WITHHOLD PAYMENT
17 TO THE MUNICIPALITY ANY FUNDS TO WHICH THE MUNICIPALITY MAY BE
18 ENTITLED FOR PENSION PURPOSES. THE BOARD MAY RECOVER ANY SUMS
19 DUE TO THE FUND BY SUIT AT LAW, OR OTHER APPROPRIATE REMEDY.
20 Section 413. Procedures for Amending Contracts.--Any
21 municipality which has joined the system under the provisions of
22 this Article IV may, with the approval of the board, amend the
23 contract with the board to increase any of the benefits
24 enumerated in Article IV to its members. The board shall not
25 enter into any amended contract with any municipality which
26 decreases benefits, nor shall it enter into any amended contract
27 with a municipality which provides for benefits in excess of or
28 minimum member's contribution rates less than those available to
29 it under any other existing law pertaining to the establishment
30 of retirement systems for that class of municipality. Before the
19730S0471B1162 - 74 -
1 board approves any such amended contract it shall first
2 determine, through its actuary, that the plan outlined is
3 actuarially sound. Any member municipality which elects to enter
4 into an amended contract for increased benefits which would
5 result in an increase in its employes contribution rates shall
6 first obtain the written consent of at least seventy-five per
7 cent of its then member employes. Additional costs for increases
8 in benefits shall become the responsibility of the municipality
9 and/or the member as specified in the contract.
10 ARTICLE V
11 REPEALS AND EFFECTIVE DATE
12 Section 501. Repeals.--The following act are repealed
13 absolutely:
14 (1) The act of June 4, 1943 (P.L.886, No.371), known as the
15 "Municipal Employes' Retirement Law."
16 (2) The act of July 31, 1968 (P.L.944, No.291), known as the
17 "Municipal Police Retirement Law,"
18 Section 502. Effective Date.--This act shall take effect in
19 ninety days.
B20L47RLC/19730S0471B1162 - 75 -