PRINTER'S NO. 2026
No. 1688 Session of 1989
INTRODUCED BY PIEVSKY, O'DONNELL, MANDERINO, KOSINSKI,
DONATUCCI, OLIVER, HAYDEN, JAMES, BISHOP, HARPER, COHEN,
WILLIAMS, RIEGER, THOMAS, HOWLETT, ACOSTA, ROEBUCK AND CARN,
JUNE 12, 1989
REFERRED TO COMMITTEE ON APPROPRIATIONS, JUNE 12, 1989
AN ACT
1 Amending Title 71 (State Government) of the Pennsylvania
2 Consolidated Statutes, transferring the pension service
3 credit of certain Philadelphia Regional Port Authority
4 employees to the State Employees' Retirement System.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. The definition of "state employee" in section
8 5102 of Title 71 of the Pennsylvania Consolidated Statutes is
9 amended to read:
10 § 5102. Definitions.
11 The following words and phrases as used in this part, unless
12 a different meaning is plainly required by the context, shall
13 have the following meanings:
14 * * *
15 "State employee." Any person holding a State office or
16 position under the Commonwealth, employed by the State
17 Government of the Commonwealth, in any capacity whatsoever,
18 except an independent contractor or any person compensated on a
1 fee basis, and shall include members of the General Assembly,
2 and any officer or employee of the following:
3 (1) (i) The Department of Education.
4 (ii) State-owned educational institutions.
5 (iii) Community colleges.
6 (iv) The Pennsylvania State University, except an
7 employee in the College of Agriculture who is paid wholly
8 from Federal funds or an employee who is participating in
9 the Federal Civil Service Retirement System. The
10 university shall be totally responsible for all employer
11 contributions under section 5507 (relating to
12 contributions by the Commonwealth and other employers).
13 (2) The Pennsylvania Turnpike Commission, the Delaware
14 River Port Authority, the Port Authority Transit Corporation,
15 the Philadelphia Regional Port Authority, the Delaware River
16 Joint Toll Bridge Commission, the State Public School
17 Building Authority, The General State Authority, the State
18 Highway and Bridge Authority, the Delaware Valley Regional
19 Planning Commission, the Interstate Commission of the
20 Delaware River Basin, and the Susquehanna River Basin
21 Commission any time subsequent to its creation, provided the
22 commission or authority agrees to contribute and does
23 contribute to the fund, from time to time, the moneys
24 required to build up the reserves necessary for the payment
25 of the annuities of such officers and employees without any
26 liability on the part of the Commonwealth to make
27 appropriations for such purposes, and provided in the case of
28 employees of the Interstate Commission of the Delaware River
29 Basin, that the employee shall have been a member of the
30 system for at least ten years prior to January 1, 1963.
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1 (3) Any separate independent public corporation created
2 by statute, not including any municipal or quasi-municipal
3 corporation, so long as he remains an officer or employee of
4 such public corporation, and provided that such officer or
5 employee of such public corporation was an employee of the
6 Commonwealth immediately prior to his employment by such
7 corporation, and further provided such public corporation
8 shall agree to contribute and contributes to the fund, from
9 time to time, the moneys required to build up the reserves
10 necessary for the payment of the annuities of such officers
11 and employees without any liability on the part of the
12 Commonwealth to make appropriations for such purposes.
13 * * *
14 Section 2. Section 5301(a) and (c) or Title 71 are amended
15 to read:
16 § 5301. Mandatory and optional membership.
17 (a) Mandatory membership.--Membership in the system shall be
18 mandatory as of the effective date of employment for all State
19 employees except the following:
20 (1) Governor.
21 (2) Lieutenant Governor.
22 (3) Members of the General Assembly.
23 (4) Heads or deputy heads of administrative departments.
24 (5) Members of any independent administrative board or
25 commission.
26 (6) Members of any departmental board or commission.
27 (7) Members of any advisory board or commission.
28 (8) Secretary to the Governor.
29 (9) Budget Secretary.
30 (10) Legislative employees.
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1 (11) School employees who have elected membership in the
2 Public School Employees' Retirement System.
3 (12) School employees who have elected membership in an
4 independent retirement program approved by the employer,
5 provided that in no case, except as hereinafter provided,
6 shall the employer contribute on account of such elected
7 membership at a rate greater than the employer normal
8 contribution rate as determined in section 5508(b) (relating
9 to actuarial cost method). For the fiscal year 1986-1987 an
10 employer may contribute on account of such elected membership
11 at a rate which is the greater of 7% or the employer normal
12 contribution rate as determined in section 5508(b) and for
13 all years after that at a rate of 8.95%.
14 (13) Persons who have elected to retain membership in
15 the retirement system of the political subdivision by which
16 they were employed prior to becoming eligible for membership
17 in the State Employees' Retirement System.
18 (14) Persons who are not members of the system and are
19 employed on a per diem or hourly basis for less than 100 days
20 or 750 hours in a 12-month period.
21 (15) Employees of the Philadelphia Regional Port
22 Authority who have elected to retain membership in the
23 pension plan or retirement system in which they were enrolled
24 prior to the creation of the Philadelphia Regional Port
25 Authority.
26 * * *
27 (c) Prohibited membership.--The State employees listed in
28 subsection (a)(12), (13) [and (14)], (14) and (15) shall not
29 have the right to elect membership in the system.
30 Section 3. Section 5303 of Title 71 is amended by adding a
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1 subsection to read:
2 § 5303. Retention and reinstatement of service credits.
3 * * *
4 (e) Transfer of certain pension service credit; Philadelphia
5 Regional Port Authority.--
6 (1) Any employee of the Philadelphia Regional Port
7 Authority who becomes a State employee, as defined in section
8 5102 (relating to definitions), shall be eligible to obtain
9 retirement credit for prior uncredited service with the
10 Philadelphia Port Corporation, a Pennsylvania not-for-profit
11 corporation ("predecessor corporation"), provided that the
12 Commonwealth does not incur any liability for the funding of
13 the annuities attributable to the prior, uncredited
14 "predecessor corporation" service, the cost of which shall be
15 determined according to paragraph (2).
16 (2) The employee shall be entitled to have any prior
17 service in the "predecessor corporation" transferred to the
18 system and deemed to be State service for all purposes under
19 this part. However, for those employees who were in
20 continuous employment which commenced prior to July 22, 1983,
21 the provisions of section 5505.1 shall not apply. The
22 transfer of prior service credit to the system shall occur
23 upon the transfer by the member or the "predecessor
24 corporation" to the system of the amount of accumulated
25 member contributions, pick-up contributions and credited
26 interest standing in the employee's pension plan or
27 retirement system account as of the date that these funds are
28 transferred to the system. In the event that these funds have
29 been refunded to the member, the transfer of service credit
30 shall occur when the member transfers an amount equal to
19890H1688B2026 - 5 -
1 either the refund which the member received from the member's
2 pension plan or retirement system or the amount due under
3 section 5504, if less. In the case of a transfer by the
4 member, the transfer shall occur by December 31, 1989, in
5 order for the member to receive credit for the prior service.
6 In the case of a transfer by the "predecessor corporation"
7 pension plan or retirement system, the transfer shall also
8 occur by December 31, 1989. Notwithstanding the provisions of
9 section 5504, the Philadelphia Regional Port Authority shall
10 pay as pick-up contributions the difference between the
11 amount credited to the member's account and the amount
12 otherwise due under section 5504. Such additional
13 contributions paid by the Philadelphia Regional Port
14 Authority shall not be considered compensation for the
15 purposes of this part. If the amount transferred to the
16 system by the member is greater than the amount that would
17 have accumulated in the member's account if the employee had
18 been a member of the system, all excess funds shall be
19 returned to the employee within 90 days of the date on which
20 such funds are credited to the member's account in the
21 system. Within 60 days of receipt of written notice that an
22 employee has elected to transfer credits under the provisions
23 of this subsection, the pension plan or retirement system in
24 which the employee was enrolled prior to the creation of the
25 Philadelphia Regional Port Authority shall be required to
26 transfer to the system an amount, excluding contributions due
27 under section 5504(a), equal to the liability of the prior
28 service multiplied by the ratio of system actuarial value of
29 assets for active members to the system actuarial accrued
30 liability for active members so long as the amount to be
19890H1688B2026 - 6 -
1 transferred is equal to or less than the total employer
2 contributions made on behalf of the employee. In the event
3 that the amount required to be transferred is greater than
4 the total employer contributions made on behalf of the
5 employee, the total employer contributions made on behalf of
6 the employee shall be transferred to the system and the
7 Philadelphia Regional Port Authority shall be required to
8 transfer to the system the additional funds needed to satisfy
9 the requirements of the calculation in this paragraph. If the
10 amount required to be transferred is less than the total
11 employer contributions made on behalf of the employee, the
12 pension plan or retirement system in which the employee was
13 enrolled prior to the creation of the Philadelphia Regional
14 Port Authority may retain the amount not needed for transfer.
15 (3) If the member dies on or after the effective date of
16 this subsection and before January 1, 1990, without making
17 the transfer or requesting the transfer necessary to receive
18 credit for the prior service authorized in paragraph (2), the
19 personal representative for the estate of the member may make
20 any transfer or may request that the Philadelphia Regional
21 Port Authority make any transfer necessary to receive credit
22 for the prior service. In order to receive credit for the
23 prior service, the transfer must be made by March 31, 1990.
24 If the member dies after December 31, 1989, without making
25 the transfer or without requesting the transfer necessary to
26 receive credit for the prior service authorized in paragraph
27 (2), neither the member nor his estate shall receive credit
28 for the prior service.
29 Section 4. This act shall take effect immediately.
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