PRIOR PRINTER'S NO. 2826 PRINTER'S NO. 3020
No. 2109 Session of 2003
INTRODUCED BY NICKOL, OCTOBER 21, 2003
AS REPORTED FROM COMMITTEE ON STATE GOVERNMENT, HOUSE OF
REPRESENTATIVES, AS AMENDED, NOVEMBER 25, 2003
AN ACT
1 Amending Titles 24 (Education) and 71 (State Government) of the
2 Pennsylvania Consolidated Statutes, further providing for
3 actuarial cost method, for administrative duties of board, <--
4 for mandatory and optional membership, for retention and
5 reinstatement of service credits, for classes of service, for
6 election to become a Class C-1 member, for transfer of
7 accumulated deductions and for members' savings account; and
8 further providing for contributions by the Commonwealth and
9 other employers and for actuarial cost method.
10 The General Assembly of the Commonwealth of Pennsylvania
11 hereby enacts as follows:
12 Section 1. Sections 8328(a) and 8502(e) SECTION 8328(A), (C) <--
13 AND (E) of Title 24 of the Pennsylvania Consolidated Statutes
14 are amended to read:
15 § 8328. Actuarial cost method.
16 (a) Employer contribution rate on behalf of active
17 members.--The amount of the total employer contributions on
18 behalf of all active members shall be computed by the actuary as
19 a percentage of the total compensation of all active members
20 during the period for which the amount is determined and shall
1 be so certified by the board. The total contribution rate on
2 behalf of all active members shall consist of the normal
3 contribution rate as defined in subsection (b), the accrued
4 liability contribution rate as defined in subsection (c) and the
5 supplemental annuity contribution rate as defined in subsection
6 (d). The total contribution rate shall be modified by the
7 experience adjustment factors as calculated in subsection (e)
8 but in no case shall it be less than [1% plus] 3.75%, plus the
9 premium assistance contribution rate.
10 * * *
11 (C) ACCRUED LIABILITY CONTRIBUTION RATE.-- <--
12 (1) FOR THE FISCAL YEAR BEGINNING JULY 1, 2002, THE
13 ACCRUED LIABILITY CONTRIBUTION RATE SHALL BE COMPUTED AS THE
14 RATE OF TOTAL COMPENSATION OF ALL ACTIVE MEMBERS WHICH SHALL
15 BE CERTIFIED BY THE ACTUARY AS SUFFICIENT TO FUND OVER A
16 PERIOD OF TEN YEARS FROM JULY 1, 2002, THE PRESENT VALUE OF
17 THE LIABILITIES FOR ALL PROSPECTIVE BENEFITS OF ACTIVE
18 MEMBERS, EXCEPT FOR THE SUPPLEMENTAL BENEFITS PROVIDED IN
19 SECTIONS 8348, 8348.1, 8348.2, 8348.3, 8348.4, 8348.5, 8348.6
20 AND 8348.7, IN EXCESS OF THE TOTAL ASSETS IN THE FUND
21 (CALCULATED BY RECOGNIZING THE ACTUARIALLY EXPECTED
22 INVESTMENT RETURN IMMEDIATELY AND RECOGNIZING THE DIFFERENCE
23 BETWEEN THE ACTUAL INVESTMENT RETURN AND THE ACTUARIALLY
24 EXPECTED INVESTMENT RETURN OVER A FIVE-YEAR PERIOD),
25 EXCLUDING THE BALANCE IN THE ANNUITY RESERVE ACCOUNT, AND OF
26 THE PRESENT VALUE OF NORMAL CONTRIBUTIONS AND OF MEMBER
27 CONTRIBUTIONS PAYABLE WITH RESPECT TO ALL ACTIVE MEMBERS ON
28 JULY 1, 2002, DURING THE REMAINDER OF THEIR ACTIVE SERVICE.
29 (2) THEREAFTER, THE AMOUNT OF EACH ANNUAL ACCRUED
30 LIABILITY CONTRIBUTION SHALL BE EQUAL TO THE AMOUNT OF SUCH
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1 CONTRIBUTION FOR THE FISCAL YEAR, BEGINNING JULY 1, 2002,
2 EXCEPT THAT, IF THE ACCRUED LIABILITY IS INCREASED BY
3 LEGISLATION ENACTED SUBSEQUENT TO JUNE 30, 2002, BUT BEFORE
4 JULY 1, 2003, SUCH ADDITIONAL LIABILITY SHALL BE FUNDED OVER
5 A PERIOD OF TEN YEARS FROM THE FIRST DAY OF JULY, COINCIDENT
6 WITH OR NEXT FOLLOWING THE EFFECTIVE DATE OF THE INCREASE.
7 THE AMOUNT OF EACH ANNUAL ACCRUED LIABILITY CONTRIBUTION FOR
8 SUCH ADDITIONAL LEGISLATIVE LIABILITIES SHALL BE EQUAL TO THE
9 AMOUNT OF SUCH CONTRIBUTION FOR THE FIRST ANNUAL PAYMENT.
10 (3) NOTWITHSTANDING ANY OTHER PROVISION OF LAW,
11 BEGINNING JULY 1, 2004 THE OUTSTANDING BALANCE OF THE
12 INCREASE IN ACCRUED LIABILITY DUE TO THE CHANGE IN BENEFITS
13 ENACTED IN 2001 AND THE OUTSTANDING BALANCE OF THE NET
14 ACTUARIAL LOSS INCURRED IN FISCAL YEAR 2000-2001 SHALL BE
15 AMORTIZED IN EQUAL DOLLAR ANNUAL CONTRIBUTIONS OVER A PERIOD
16 THAT ENDS 20 YEARS AFTER JULY 1, 2002, AND THE OUTSTANDING
17 BALANCE OF THE NET ACTUARIAL LOSS INCURRED IN FISCAL YEAR
18 2001-2002 SHALL BE AMORTIZED IN EQUAL DOLLAR ANNUAL
19 CONTRIBUTIONS OVER A PERIOD THAT ENDS 20 YEARS AFTER JULY 1,
20 2003. FOR FISCAL YEARS BEGINNING ON OR AFTER JULY 1, 2004, IF
21 THE ACCRUED LIABILITY IS INCREASED BY LEGISLATION ENACTED
22 SUBSEQUENT TO JUNE 30, 2003, SUCH ADDITIONAL LIABILITY SHALL
23 BE FUNDED IN EQUAL DOLLAR ANNUAL CONTRIBUTIONS OVER A PERIOD
24 OF TEN YEARS FROM THE FIRST DAY OF JULY COINCIDENT WITH OR
25 NEXT FOLLOWING THE EFFECTIVE DATE OF THE INCREASE.
26 * * *
27 (E) EXPERIENCE ADJUSTMENT FACTOR.--
28 (1) FOR EACH YEAR AFTER THE ESTABLISHMENT OF THE ACCRUED
29 LIABILITY CONTRIBUTION RATE FOR THE FISCAL YEAR BEGINNING
30 JULY 1, 2002, ANY INCREASE OR DECREASE IN THE UNFUNDED
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1 ACCRUED LIABILITY, EXCLUDING THE GAINS OR LOSSES ON THE
2 ASSETS OF THE HEALTH INSURANCE ACCOUNT, DUE TO ACTUAL
3 EXPERIENCE DIFFERING FROM ASSUMED EXPERIENCE, CHANGES IN
4 ACTUARIAL ASSUMPTIONS, CHANGES IN THE TERMS AND CONDITIONS OF
5 THE BENEFITS PROVIDED BY THE SYSTEM BY JUDICIAL,
6 ADMINISTRATIVE OR OTHER PROCESSES OTHER THAN LEGISLATION,
7 INCLUDING, BUT NOT LIMITED TO, REINTERPRETATION OF THE
8 PROVISIONS OF THIS PART, SHALL BE AMORTIZED IN EQUAL DOLLAR
9 ANNUAL [INSTALLMENTS] CONTRIBUTIONS OVER A PERIOD OF TEN
10 YEARS BEGINNING WITH THE JULY 1 SECOND SUCCEEDING THE
11 ACTUARIAL VALUATION.
12 (2) NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH (1), FOR
13 EACH YEAR AFTER THE ESTABLISHMENT OF THE ACCRUED LIABILITY
14 CONTRIBUTION RATE FOR THE FISCAL YEAR BEGINNING JULY 1, 2003,
15 ANY INCREASE OR DECREASE IN THE UNFUNDED ACCRUED LIABILITY,
16 EXCLUDING THE GAINS OR LOSSES ON THE ASSETS OF THE HEALTH
17 INSURANCE ACCOUNT, DUE TO ACTUAL EXPERIENCE DIFFERING FROM
18 ASSUMED EXPERIENCE, CHANGES IN ACTUARIAL ASSUMPTIONS, CHANGES
19 IN THE TERMS AND CONDITIONS OF THE BENEFITS PROVIDED BY THE
20 SYSTEM BY JUDICIAL, ADMINISTRATIVE OR OTHER PROCESSES OTHER
21 THAN LEGISLATION, INCLUDING, BUT NOT LIMITED TO,
22 REINTERPRETATION OF THE PROVISIONS OF THIS PART, SHALL BE
23 AMORTIZED IN EQUAL DOLLAR ANNUAL CONTRIBUTIONS OVER A PERIOD
24 OF 20 YEARS BEGINNING WITH THE JULY 1 SECOND SUCCEEDING THE
25 ACTUARIAL VALUATION DETERMINING SAID INCREASES AND DECREASES.
26 * * *
27 § 8502. Administrative duties of board. <--
28 * * *
29 (e) Records.--The board shall keep a record of all its
30 proceedings which shall be open to inspection by the public.
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1 Notwithstanding the preceding, any record, material or data
2 received, prepared, used or retained by the board or its
3 employees, investment professionals or agents shall not be open
4 to inspection by the public or constitute a public record under
5 the act of June 21, 1957 (P.L.390, No.212), referred to as the
6 Right-to-Know Law, if the disclosure could:
7 (1) adversely affect or impact the value of the system's
8 investments;
9 (2) release proprietary information in violation of a
10 contractual confidentiality agreement;
11 (3) impair the board's ability to maximize the return on
12 any investment of the fund;
13 (4) potentially expose an investment of the fund to
14 significant competitive harm or place it at a competitive
15 disadvantage; or
16 (5) otherwise compromise the board's fiduciary
17 obligations or duty of care to the members of the system
18 under this part.
19 Section 2. The definition of "class of service multiplier"
20 in section 5102 of Title 71 is amended to read:
21 § 5102. Definitions.
22 The following words and phrases as used in this part, unless
23 a different meaning is plainly required by the context, shall
24 have the following meanings:
25 * * *
26 "Class of service multiplier."
27 Class of Service Multiplier
28 A 1
29 AA for all purposes
30 except
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1 calculating regular
2 member contributions
3 on compensation
4 paid prior to
5 January 1, 2002 1.25
6 AA for purposes
7 of calculating
8 regular member
9 contributions
10 on compensation
11 paid prior to
12 January 1, 2002 1
13 B .625
14 C 1
15 C-1 for all purposes
16 except
17 calculating regular
18 member contributions
19 on compensation
20 paid prior to
21 January 1, 2004 1.25
22 C-1 for purposes
23 of
24 calculating regular
25 member contributions
26 on compensation
27 paid prior to
28 January 1, 2004 1
29 D 1.25
30 D-1 prior to
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1 January 1, 1973 1.875
2 D-1 on and
3 subsequent to
4 January 1, 1973 1.731
5 D-2 prior to
6 January 1, 1973 2.5
7 D-2 on and
8 subsequent to
9 January 1, 1973 1.731
10 D-3 prior to
11 January 1, 1973 3.75
12 D-3 on and
13 subsequent to
14 January 1, 1973 1.731 except prior to December
15 1, 1974 as applied to any
16 additional legislative
17 compensation as an officer
18 of the General Assembly
19 3.75
20 D-4 for all purposes
21 except
22 calculating
23 regular member
24 contributions
25 on compensation
26 paid prior to
27 July 1, 2001 1.5
28 D-4 for purposes of
29 calculating
30 regular member
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1 contributions
2 on compensation
3 paid prior to
4 July 1, 2001 1
5 E, E-1 prior to
6 January 1, 1973 2 for each of the first ten
7 years of judicial service,
8 and
9 1.5 for each subsequent year
10 of judicial service
11 E, E-1 on and
12 subsequent to
13 January 1, 1973 1.50 for each of the first
14 ten years of judicial
15 service and
16 1.125 for each subsequent year
17 of judicial service
18 E-2 prior to
19 September 1, 1973 1.5
20 E-2 on and
21 subsequent to
22 September 1, 1973 1.125
23 G 0.417
24 H 0.500
25 I 0.625
26 J 0.714
27 K 0.834
28 L 1.000
29 M 1.100
30 N 1.250
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1 T-C (Public School 1
2 Employees'
3 Retirement Code)
4 * * *
5 Section 3. Sections 5301(a) and (f) and 5303(b)(1) and (g)
6 of Title 71 are amended to read:
7 § 5301. Mandatory and optional membership.
8 (a) Mandatory membership.--Membership in the system shall be
9 mandatory as of the effective date of employment for all State
10 employees except the following:
11 (1) Governor.
12 (2) Lieutenant Governor.
13 (3) Members of the General Assembly.
14 (4) Heads or deputy heads of administrative departments.
15 (5) Members of any independent administrative board or
16 commission.
17 (6) Members of any departmental board or commission.
18 (7) Members of any advisory board or commission.
19 (8) Secretary to the Governor.
20 (9) Budget Secretary.
21 (10) Legislative employees.
22 (11) School employees who have elected membership in the
23 Public School Employees' Retirement System.
24 (12) School employees who have elected membership in an
25 independent retirement program approved by the employer,
26 provided that in no case, except as hereinafter provided,
27 shall the employer contribute on account of such elected
28 membership at a rate greater than the employer normal
29 contribution rate as determined in section 5508(b) (relating
30 to actuarial cost method). For the fiscal year 1986-1987 an
20030H2109B3020 - 9 -
1 employer may contribute on account of such elected membership
2 at a rate which is the greater of 7% or the employer normal
3 contribution rate as determined in section 5508(b) and for
4 the fiscal year 1992-1993 and all years after that at a rate
5 of 9.29%.
6 (13) Persons who have elected to retain membership in
7 the retirement system of the political subdivision by which
8 they were employed prior to becoming eligible for membership
9 in the State Employees' Retirement System.
10 (14) Persons who are not members of the system and are
11 employed on a per diem or hourly basis for less than 100 days
12 or 750 hours in a 12-month period.
13 (15) Employees of the Philadelphia Regional Port
14 Authority who have elected to retain membership in the
15 pension plan or retirement system in which they were enrolled
16 as employees of the predecessor Philadelphia Port Corporation
17 prior to the creation of the Philadelphia Regional Port
18 Authority.
19 [(16) Employees of the Juvenile Court Judges' Commission
20 who, before the effective date of this paragraph, were
21 transferred from the State System of Higher Education to the
22 Juvenile Court Judges' Commission as a result of an
23 interagency transfer of staff approved by the Office of
24 Administration and who, while employees of the State System
25 of Higher Education, had elected membership in an independent
26 retirement program approved by the employer.]
27 * * *
28 [(f) Additional optional membership.--The State employees
29 listed in subsection (a)(16) shall be mandatory members of the
30 system as of the effective date of employment with the Juvenile
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1 Court Judges' Commission unless they elect membership in an
2 independent retirement program approved by the Juvenile Court
3 Judges' Commission. Employees who elect membership in an
4 independent retirement program approved by the Juvenile Court
5 Judges' Commission shall be prohibited from being active members
6 in the system while employed by the Juvenile Court Judges'
7 Commission. If an employee described in this subsection becomes
8 a State employee with an employer other than the Juvenile Court
9 Judges' Commission, then membership for that employee shall be
10 determined as otherwise provided for in this part. The election
11 of membership in the independent retirement program approved by
12 the Juvenile Court Judges' Commission must be made by the
13 transferred employee filing written notice with the employer
14 while a State employee no later than 90 days after the effective
15 date of this subsection. Upon receipt of such an election, the
16 Juvenile Court Judges' Commission shall certify the election to
17 the board and the independent retirement program.]
18 § 5303. Retention and reinstatement of service credits.
19 * * *
20 (b) Eligibility points for prospective credited service.--
21 (1) Every active member of the system or a multiple
22 service member who is a school employee and a member of the
23 Public School Employees' Retirement System on or after the
24 effective date of this part shall receive eligibility points
25 in accordance with section 5307 for current State service,
26 previous State service, or creditable nonstate service upon
27 compliance with sections 5501 (relating to regular member
28 contributions for current service), 5504 (relating to member
29 contributions for the purchase of credit for previous State
30 service or to become a full coverage member), 5505 (relating
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1 to contributions for the purchase of credit for creditable
2 nonstate service), 5505.1 (relating to additional member
3 contributions) or 5506 (relating to incomplete payments).
4 Subject to the limitations in sections 5306.1 (relating to
5 election to become a Class AA member) [and], 5306.2 (relating
6 to elections by members of the General Assembly) and 5306.3
7 (relating to election to become a Class C-1 member), the
8 class or classes of service in which the member may be
9 credited for previous State service prior to the effective
10 date of this part shall be the class or classes in which he
11 was or could have at any time elected to be credited for such
12 service. The class of service in which a member shall be
13 credited for service subsequent to the effective date of this
14 part shall be determined in accordance with section 5306
15 (relating to classes of service).
16 * * *
17 [(g) Credit for employees of Juvenile Court Judges'
18 Commission.--An employee of the Juvenile Court Judges'
19 Commission who elects membership in an independent retirement
20 program approved by the employer under section 5301(f) shall
21 have all service credited pursuant to section 5302(a) (relating
22 to credited State service) for State service with the Juvenile
23 Court Judges' Commission on or after the effective date of the
24 interagency transfer canceled and thereafter ineligible to be
25 credited as State service. Additionally, all creditable State
26 service and nonstate service reinstated or purchased while an
27 employee of the Juvenile Court Judges' Commission shall be
28 canceled. Such employees shall be prohibited from receiving
29 credited service for State service performed while a member of
30 an alternate retirement system approved by an employer.]
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1 * * *
2 Section 4. Section 5306(b) of Title 71 is amended and the
3 section is amended by adding a subsection to read:
4 § 5306. Classes of service.
5 * * *
6 (a.3) Class C-1 membership.--
7 (1) Provided that an election to become a Class C-1
8 member is made pursuant to section 5306.3 (relating to
9 election to become a Class C-1 member), a State employee who
10 on July 1, 2003, is:
11 (i) a member of Class C, other than a State police
12 officer; or
13 (ii) an inactive member on a leave without pay from
14 a position in which the State employee would be a Class C
15 active member if the employee was not on leave without
16 pay, other than the position of State police officer;
17 shall be classified as a Class C-1 member and receive credit
18 for Class C-1 State service performed after June 30, 2003,
19 upon payment of regular member contributions for Class C-1
20 service and shall receive Class C-1 service credit for all
21 Class C State service, other than Class C State service
22 performed as a State police officer, performed before July 1,
23 2003.
24 (2) Provided that an election to become a Class C-1
25 member is made pursuant to section 5306.3, a former State
26 employee who was a member of Class C and who was not a State
27 police officer, who on July 1, 2003, is a multiple service
28 member and a school employee and a member of the Public
29 School Employees' Retirement System, shall receive Class C-1
30 service credit for all Class C State service, other than
20030H2109B3020 - 13 -
1 Class C State service performed as a State police officer.
2 (3) A former State employee, who was a member of Class C
3 and who was not a State police officer, who is a school
4 employee and who after July 1, 2003, becomes a multiple
5 service member, shall receive Class C-1 service credit for
6 all Class C State service other than Class C State service
7 performed as a State police officer.
8 (b) Other class membership.--A State employee who is a
9 member of a class of service other than Class A on the effective
10 date of this part shall retain his membership in that class
11 until such service is discontinued; any service thereafter shall
12 be credited as Class A service, Class AA service or Class D-4
13 service as provided for in this section. Notwithstanding any
14 other provision of this section, a State employee who is
15 appointed bail commissioner of the Philadelphia Municipal Court
16 under 42 Pa.C.S. § 1123(a)(5) (relating to jurisdiction and
17 venue) may within 30 days of the effective date of this sentence
18 or within 30 days of his initial appointment as a bail
19 commissioner, whichever is later, elect Class E-2 service credit
20 for service performed as a bail commissioner after the effective
21 date of this sentence. This class of service multiplier for
22 Class E-2 service as a bail commissioner shall be 1.5.
23 * * *
24 Section 5. Title 71 is amended by adding a section to read:
25 § 5306.3 Election to become a Class C-1 member.
26 (a) General rule.--A person who is:
27 (1) a member of the system; or
28 (2) a multiple service member who is a school employee
29 and a member of the Public School Employees' Retirement
30 System;
20030H2109B3020 - 14 -
1 who on July 1, 2003, is eligible for Class C-1 membership under
2 section 5306(a.3) (relating to classes of service) may elect to
3 become a member of Class C-1.
4 (b) Time for making election.--An election to become a Class
5 C-1 member must be made by the member filing written notice with
6 the board before January 1, 2004, or before the member
7 terminates State service, or, if a school employee, before the
8 member terminates school service, whichever occurs first.
9 (c) Effect of election.--Membership as a Class C-1 member
10 shall become effective the later of July 1, 2003, or the date
11 when the election is filed with the board and shall remain in
12 effect until the termination of employment. Upon termination and
13 subsequent reemployment, the member's class of service shall be
14 credited in the class of service otherwise provided for in this
15 part.
16 (d) Effect of failure to make election.--Failure to elect to
17 become a Class C-1 member within the election period set forth
18 in subsection (b) shall result in all of the member's Class C
19 State service, other than Class C service performed as a State
20 police officer, being credited as Class C service and not
21 subject to further election or crediting as Class C-1 service
22 upon termination and subsequent reemployment.
23 Section 6. Section 5507(a) of Title 71 is amended to read:
24 § 5507. Contributions by the Commonwealth and other employers.
25 (a) Contributions on behalf of active members.--The
26 Commonwealth and other employers whose employees are members of
27 the system shall make contributions to the fund on behalf of all
28 active members in such amounts as shall be certified by the
29 board as necessary to provide, together with the members' total
30 accumulated deductions, annuity reserves on account of
20030H2109B3020 - 15 -
1 prospective annuities other than those provided in section 5708
2 (relating to supplemental annuities) in accordance with the
3 actuarial cost method provided in section 5508(a), (b), (c), (d)
4 [and], (f) and (h) (relating to actuarial cost method).
5 * * *
6 Section 7. Section 5508 of Title 71 is amended by adding a <--
7 subsection to read:
8 SECTION 7. SECTION 5508(C) AND (F) OF TITLE 71 ARE AMENDED <--
9 AND THE SECTION IS AMENDED BY ADDING A SUBSECTION TO READ:
10 § 5508. Actuarial cost method.
11 * * *
12 (C) ACCRUED LIABILITY CONTRIBUTION RATE.-- <--
13 (1) FOR THE FISCAL YEAR BEGINNING JULY 1, 2002, THE
14 ACCRUED LIABILITY CONTRIBUTION RATE SHALL BE COMPUTED AS THE
15 RATE OF TOTAL COMPENSATION OF ALL ACTIVE MEMBERS WHICH SHALL
16 BE CERTIFIED BY THE ACTUARY AS SUFFICIENT TO FUND OVER A
17 PERIOD OF TEN YEARS FROM JULY 1, 2002, THE PRESENT VALUE OF
18 THE LIABILITIES FOR ALL PROSPECTIVE BENEFITS, EXCEPT FOR THE
19 SUPPLEMENTAL BENEFITS AS PROVIDED IN SECTIONS 5708, 5708.1,
20 5708.2, 5708.3, 5708.4, 5708.5, 5708.6, 5708.7 AND 5708.8, IN
21 EXCESS OF THE TOTAL ASSETS IN THE FUND (CALCULATED
22 RECOGNIZING ALL INVESTMENT GAINS AND LOSSES OVER A FIVE-YEAR
23 PERIOD), EXCLUDING THE BALANCE IN THE SUPPLEMENTAL ANNUITY
24 ACCOUNT, AND THE PRESENT VALUE OF EMPLOYER NORMAL
25 CONTRIBUTIONS AND OF MEMBER CONTRIBUTIONS PAYABLE WITH
26 RESPECT TO ALL ACTIVE MEMBERS ON DECEMBER 31, 2001, AND
27 EXCLUDING CONTRIBUTIONS TO BE TRANSFERRED BY COUNTY
28 RETIREMENT SYSTEMS OR PENSION PLANS PURSUANT TO SECTION
29 5507(C) (RELATING TO CONTRIBUTIONS BY THE COMMONWEALTH AND
30 OTHER EMPLOYERS). THE AMOUNT OF EACH ANNUAL ACCRUED LIABILITY
20030H2109B3020 - 16 -
1 CONTRIBUTION SHALL BE EQUAL TO THE AMOUNT OF SUCH
2 CONTRIBUTION FOR THE FISCAL YEAR BEGINNING JULY 1, 2002,
3 EXCEPT THAT, IF THE ACCRUED LIABILITY IS INCREASED BY
4 LEGISLATION ENACTED SUBSEQUENT TO JUNE 30, 2002, BUT BEFORE
5 JULY 1, 2003, SUCH ADDITIONAL LIABILITY SHALL BE FUNDED OVER
6 A PERIOD OF TEN YEARS FROM THE FIRST DAY OF JULY, COINCIDENT
7 WITH OR NEXT FOLLOWING THE EFFECTIVE DATE OF THE INCREASE.
8 THE AMOUNT OF EACH ANNUAL ACCRUED LIABILITY CONTRIBUTION FOR
9 SUCH ADDITIONAL LEGISLATIVE LIABILITIES SHALL BE EQUAL TO THE
10 AMOUNT OF SUCH CONTRIBUTION FOR THE FIRST ANNUAL PAYMENT.
11 (2) NOTWITHSTANDING ANY OTHER PROVISION OF LAW,
12 BEGINNING JULY 1, 2004, THE OUTSTANDING BALANCE OF THE
13 INCREASE IN ACCRUED LIABILITY DUE TO THE CHANGE IN BENEFITS
14 ENACTED IN 2001 SHALL BE AMORTIZED IN EQUAL DOLLAR ANNUAL
15 CONTRIBUTIONS OVER A PERIOD THAT ENDS 20 YEARS AFTER JULY 1,
16 2002, AND THE OUTSTANDING BALANCE OF THE NET ACTUARIAL LOSS
17 INCURRED IN CALENDAR YEAR 2002 SHALL BE AMORTIZED IN EQUAL
18 DOLLAR ANNUAL CONTRIBUTIONS OVER A PERIOD THAT ENDS 20 YEARS
19 AFTER JULY 1, 2003. FOR FISCAL YEARS BEGINNING ON OR AFTER
20 JULY 1, 2004, IF THE ACCRUED LIABILITY IS INCREASED BY
21 LEGISLATION ENACTED SUBSEQUENT TO JUNE 30, 2003, SUCH
22 ADDITIONAL LIABILITY SHALL BE FUNDED IN EQUAL DOLLAR ANNUAL
23 CONTRIBUTIONS OVER A PERIOD OF TEN YEARS FROM THE FIRST DAY
24 OF JULY COINCIDENT WITH OR NEXT FOLLOWING THE EFFECTIVE DATE
25 OF THE INCREASE.
26 * * *
27 (F) EXPERIENCE ADJUSTMENT FACTOR.--
28 (1) FOR EACH YEAR AFTER THE ESTABLISHMENT OF THE ACCRUED
29 LIABILITY CONTRIBUTION RATE FOR THE FISCAL YEAR BEGINNING
30 JULY 1, 2002, ANY INCREASE OR DECREASE IN THE UNFUNDED
20030H2109B3020 - 17 -
1 LIABILITY, INCLUDING LIABILITY FOR SUPPLEMENTAL ANNUITIES,
2 DUE TO ACTUAL EXPERIENCE DIFFERING FROM ASSUMED EXPERIENCE,
3 CHANGES IN ACTUARIAL ASSUMPTIONS, CHANGES IN THE TERMS AND
4 CONDITIONS OF THE BENEFITS PROVIDED BY THE SYSTEM BY
5 JUDICIAL, ADMINISTRATIVE OR OTHER PROCESSES OTHER THAN
6 LEGISLATION, INCLUDING, BUT NOT LIMITED TO, REINTERPRETATION
7 OF THE PROVISIONS OF THIS PART, SHALL BE AMORTIZED IN EQUAL
8 DOLLAR ANNUAL [INSTALLMENTS] CONTRIBUTIONS OVER A PERIOD OF
9 TEN YEARS BEGINNING WITH THE JULY 1 SUCCEEDING THE ACTUARIAL
10 VALUATION.
11 (2) NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH (1), FOR
12 EACH YEAR AFTER THE ESTABLISHMENT OF THE ACCRUED LIABILITY
13 CONTRIBUTION RATE FOR THE FISCAL YEAR BEGINNING JULY 1, 2003,
14 ANY INCREASE OR DECREASE IN THE UNFUNDED ACCRUED LIABILITY
15 DUE TO ACTUAL EXPERIENCE DIFFERING FROM ASSUMED EXPERIENCE,
16 CHANGES IN ACTUARIAL ASSUMPTIONS, CHANGES IN THE TERMS AND
17 CONDITIONS OF THE BENEFITS PROVIDED BY THE SYSTEM BY
18 JUDICIAL, ADMINISTRATIVE OR OTHER PROCESSES OTHER THAN
19 LEGISLATION, INCLUDING, BUT NOT LIMITED TO, REINTERPRETATION
20 OF THE PROVISIONS OF THIS PART, SHALL BE AMORTIZED IN EQUAL
21 DOLLAR ANNUAL CONTRIBUTIONS OVER A PERIOD OF 20 YEARS
22 BEGINNING WITH THE JULY 1 SUCCEEDING THE ACTUARIAL VALUATION
23 DETERMINING SAID INCREASES AND DECREASES.
24 * * *
25 (h) Determination of liability for Class C-1 service.--
26 Notwithstanding any other provision of this part or other law,
27 the total additional accrued actuarial liability resulting from
28 Class C-1 service shall be determined by the actuary as part of
29 the first annual valuation made after the effective date of this
30 subsection. The resulting additional accrued liability shall be
20030H2109B3020 - 18 -
1 paid by the Pennsylvania Liquor Control Board and the
2 Pennsylvania State Police, the amount of which shall be divided
3 between the agencies in accordance with the percentage of total
4 Class C-1 members in each agency's employ, in annual payments
5 over a period of ten years from the first day of July,
6 coincident with or next following the first valuation made after
7 the effective date of this subsection. The amount of each annual
8 accrued liability contribution for Class C-1 service shall be
9 equal to the amount of such contribution for the first annual
10 payment.
11 Section 8. Sections 5701.1, 5902(e) and 5933(c) of Title 71 <--
12 are amended to read:
13 [§ 5701.1. Transfer of accumulated deductions.
14 When an employee of the Juvenile Court Judges' Commission
15 elects membership in an independent retirement program pursuant
16 to section 5301(f) (relating to mandatory and optional
17 membership), the board shall transfer directly to the trustee or
18 administrator of the independent retirement program all
19 accumulated deductions resulting from service credited while an
20 employee of the Juvenile Court Judges' Commission.]
21 § 5902. Administrative duties of the board. <--
22 * * *
23 (e) Records.--The board shall keep a record of all its
24 proceedings which shall be open to inspection by the public.
25 Notwithstanding the preceding, any record, material or data
26 received, prepared, used or retained by the board or its
27 employees, investment professionals or agents shall not be open
28 to inspection by the public or constitute a public record under
29 the act of June 21, 1957 (P.L.390, No.212), referred to as the
30 Right-to-Know Law, if the disclosure could:
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1 (1) adversely affect or impact the value of the system's
2 investments;
3 (2) release proprietary information in violation of a
4 contractual confidentiality agreement;
5 (3) impair the board's ability to maximize the return on
6 any investment of the fund;
7 (4) potentially expose an investment of the fund to
8 significant competitive harm or place it at a competitive
9 disadvantage; or
10 (5) otherwise compromise the board's fiduciary
11 obligations or duty of care to the members of the system
12 under this part.
13 * * *
14 § 5933. Members' savings account.
15 * * *
16 (c) Charges to account.--Upon the election of a member to
17 withdraw his total accumulated deductions [or upon the transfer
18 of accumulated deductions pursuant to section 5701.1 (relating
19 to transfer of accumulated deductions)], the payment of such
20 amount shall be charged to the members' savings account.
21 Section 9. It is the expressed intent of the General
22 Assembly to remove from 71 Pa.C.S. (State Employees' Retirement
23 Code) the provisions authorizing the Juvenile Court Judges'
24 Commission to approve an independent retirement program for
25 employees transferred from Shippensburg University. The Juvenile
26 Court Judges' Commission did not approve an independent
27 retirement program within the time permitted by the amendments
28 to the State Employees' Retirement Code contained in the act of
29 April 23, 2002 (P.L.272, No.38), and the General Assembly hereby
30 removes the amendments authorizing the Juvenile Court Judges'
20030H2109B3020 - 20 -
1 Commission to approve an independent retirement plan. It is
2 hereby declared that in the event a court of competent
3 jurisdiction rules finally that the repeal of any of the
4 provisions pertaining to the approval of an independent
5 retirement program by the Juvenile Court Judges' Commission are
6 legally or constitutionally impermissible, the amendment of 71
7 Pa.C.S. §§ 5301(a) and (f), 5303(g), 5701.1 and 5933(c) shall be
8 void.
9 Section 10. The amendment of 24 Pa.C.S. § 8502(e) and 71 <--
10 Pa.C.S. § 5902(e) shall be retroactive to July 1, 2003.
11 SECTION 10. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, THE <--
12 TOTAL CONTRIBUTION RATE FOR THE FISCAL YEAR BEGINNING JULY 1,
13 2004, AS CALCULATED UNDER 24 PA.C.S. § 8328, INCLUDING THE
14 AMOUNT NECESSARY TO FUND PREMIUM ASSISTANCE, SHALL NOT BE LESS
15 THAN 3.75%.
16 Section 11. This act shall take effect as follows:
17 (1) The amendment of 71 Pa.C.S. § 5306(a)(3) and (b)
18 shall take effect in 45 days.
19 (2) The amendment of 24 Pa.C.S. § 8328 shall take effect
20 July 1, 2004.
21 (3) The remainder of this act shall take effect
22 immediately.
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