THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

INTRODUCED BY M. SMITH, TURZAI, FRANKEL, GERGELY, HARRIS, MAHER, MUSTIO, SIPTROTH, WAGNER, WALKO AND ROAE, FEBRUARY 26, 2009

REFERRED TO COMMITTEE ON FINANCE, FEBRUARY 26, 2009  

AN ACT

Amending the act of July 28, 1953 (P.L.723, No.230), entitled,

as amended, "An act relating to counties of the second class

and second class A; amending, revising, consolidating and

changing the laws relating thereto," in employes' retirement

system, further defining "compensation"; and further

providing for retirement board and for amount of retirement

allowances.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  The definition of "compensation" in section 1701

of the act of July 28, 1953 (P.L.723, No.230), known as the

Second Class County Code, amended July 6, 1984 (P.L.638, No.

131), is amended to read:

Section 1701.  Definitions.--The following words and phrases

as used in this article shall be construed to have the following

meaning:

* * *

"Compensation,"  [pickup] (1)  Pickup contributions plus

salary or wages received per day, weekly, bi-weekly, semi-

monthly, monthly, annually, or during an official term year.

(2)  For employes hired or reemployed on or after the

effective date of this clause, the term shall not include

overtime pay.

* * *

Section 2.  Section 1703 of the act is amended to read:

Section 1703.  Retirement Board.--The retirement system shall

be under the sole direction of a board, which shall consist of

the county [commissioners, the treasurer, the controller,] chief

executive; one member, who shall be a member of the retirement

system, appointed by the chief executive with the consent of

county council; one member, who shall be a member of the

retirement system, appointed by county council; the controller;

the treasurer; and two persons elected by ballot from among the

members of the retirement system[, one to serve for two years

and one for four years. Following the completion of the initial

terms, the stated]. The terms of such members shall be four

years. Ballots shall be mailed to each member of the retirement

system at least twenty (20) days prior to the date of the

election. A vacancy occurring during the term of any member of

the board shall be filled for the unexpired term by the

appointment or election of a successor in the same manner as his

predecessor. A majority of the members of the board shall

constitute a quorum for the transaction of any business.

Section 3.  Section 1712(a) of the act, amended October 30,

2000 (P.L.616, No.85), is amended to read:

Section 1712.  Amount of Retirement Allowances.--(a)  (1) 

The retirement allowance paid under the provisions of this

article shall equal fifty per centum of the amount which would

constitute the average monthly compensation as received by the

county employe during the highest twenty-four months of the last

four (4) years of his employment or two years on a bi-weekly pay

basis in which period of time the said county employe made

monthly or bi-weekly contributions into the retirement fund

prior to his or her retirement.

(2)  For employes hired after the effective date of this

clause, the retirement allowance paid under the provisions of

this article shall be equal to fifty per centum of the amount

which would constitute the average monthly compensation as

received by the county employe during the highest forty-eight

months of the last eight (8) years of his employment or four (4)

years on a bi-weekly pay basis in which period of time the

county employe made monthly or bi-weekly contributions into the

retirement fund prior to his or her retirement.

(3)  Such average monthly compensation shall include the

compensation which any county employe would have been entitled

to and would have received except for deduction from

compensation due to time spent in serving as an elected State

official: Provided, That the county and the employe shall make

monthly contributions based on the last compensation equal to

the amount the county and he or she would have paid into the

retirement fund had such compensation been paid by the county.

In the event an employe, on the effective date of employment

termination, shall have less than a full year of service for the

purpose of computing the employe's service time, then the amount

of the retirement allowance, which would have been computed had

the employe completed a full twelve-month period for the year of

the termination of employment, shall be prorated upon a full

completed month basis for said last year of service. No

retirement allowance shall be computed on a monthly compensation

in excess of four thousand three hundred thirty-three dollars

and thirty-three cents ($4,333.33) (referred to in this

subsection as "excess compensation") unless the employe and the

county have made contributions on all excess compensation

received by the employe during the five-year period preceding

the employe's retirement: Provided, That the required

contribution is paid into the retirement system within ninety

(90) days of the date of retirement. An employe who retires

within five (5) years of the effective date of the compensation

cap removal may elect to satisfy the contribution requirement by

making a lump sum contribution that is calculated by applying

the applicable contribution percentage rate to all excess

compensation received by the employe during the prior five-year

period on which contributions were not made. Within ninety (90)

days of such contribution by an employe, contributions shall

also be made by the county in an amount equal to the amount

contributed by the employe. The effective date of the cap

removal is December 31, 1999.

(4)  After the effective date of this amendment, certain

former county employes who are now receiving a retirement

allowance shall receive an increase of a certain per centum of

such retirement allowance, which sum shall be computed on the

average monthly retirement allowance as heretofore authorized by

the board.

(5)  The per centum of increase in said monthly retirement

allowance shall be a flat 10 per centum increase with the

maximum amount not to exceed forty-five dollars ($45.00) per

month.

(6)  Any employe who earns in excess of ten thousand eight

hundred dollars ($10,800) per annum and shall retire during the

period from January 1, 1973 to December 31, 1981 shall pay, as a

condition to the payment of any benefits hereunder a lump sum

contribution into the retirement fund, which contribution shall

be computed as follows:

(i)  The difference between ten thousand eight hundred

dollars ($10,800) and the annual salary of the employe

multiplied by the number of years during which he was not an

employe of the county for the period aforesaid and upon that

amount the sum of two per centum which shall be the lump sum

contribution as required herein.

(ii)  No person who is reemployed as a county employe shall

be eligible to receive the benefit of a retirement allowance

plus a service increment, if any, until he or she shall have

made at least twenty-four monthly or fifty-two bi-weekly

contributions into the retirement fund subsequent to his or her

reemployment. The foregoing provisions shall not have a

retroactive application and shall apply only to present and

future county employes. The rate required to be paid in

accordance with this provision shall apply to present county

employes notwithstanding the rate of contribution that the

present county employe has made into the retirement fund.

* * *

Section 4.  This act shall take effect in 60 days.