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| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
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| HOUSE BILL |
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| INTRODUCED BY D. EVANS, BRIGGS, PARKER, WILLIAMS, GALLOWAY, DePASQUALE, KORTZ AND W. KELLER, MAY 11, 2010 |
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| REFERRED TO COMMITTEE ON APPROPRIATIONS, MAY 11, 2010 |
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| AN ACT |
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1 | Amending Titles 24 (Education) and 71 (State Government) of the |
2 | Pennsylvania Consolidated Statutes, in Title 24, further |
3 | providing for definitions, for contributions by the |
4 | Commonwealth, for payments by employers, for actuarial cost |
5 | method, for additional supplemental annuities, for further |
6 | additional supplemental annuities, for supplemental annuities |
7 | commencing 1994, for supplemental annuities commencing 1998, |
8 | for supplemental annuities commencing 2002, for supplemental |
9 | annuities commencing 2003, for administrative duties of board |
10 | and for payments to school entities by Commonwealth; in Title |
11 | 71, providing for definitions; further providing for |
12 | contributions by the Commonwealth and other employers, for |
13 | actuarial cost method, for additional supplemental annuities, |
14 | for further additional supplemental annuities, for |
15 | supplemental annuities commencing 1994, for supplemental |
16 | annuities commencing 1998, for supplemental annuities |
17 | commencing 2002, for supplemental annuities commencing 2003, |
18 | for special supplemental postretirement adjustment of 2002, |
19 | for administrative duties of the board, for State |
20 | accumulation account and for supplemental annuity account; |
21 | and providing for recertification to the Secretary of the |
22 | Budget and for holding certain public officials harmless. |
23 | The General Assembly of the Commonwealth of Pennsylvania |
24 | hereby enacts as follows: |
25 | Section 1. The definition of "employer" in section 8102 of |
26 | Title 24 of the Pennsylvania Consolidated Statutes is amended to |
27 | read: |
28 | § 8102. Definitions. |
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1 | The following words and phrases when used in this part shall |
2 | have, unless the context clearly indicates otherwise, the |
3 | meanings given to them in this section: |
4 | * * * |
5 | "Employer." Any governmental entity directly responsible for |
6 | the employment and payment of the school employee and charged |
7 | with the responsibility of providing public education within |
8 | this Commonwealth, including but not limited to: State-owned |
9 | colleges and universities, the Pennsylvania State University, |
10 | community colleges, area vocational-technical schools, |
11 | intermediate units, the State Board of Education, Scotland |
12 | School for Veterans' Children, Thaddeus Stevens State School of |
13 | Technology, and the [Pennsylvania State Oral] Western |
14 | Pennsylvania School for the Deaf. |
15 | * * * |
16 | Section 2. Sections 8326(a), 8327(a) and (c), 8328, |
17 | 8348.1(f), 8348.2(f), 8348.3(f), 8348.5(f), 8348.6(f), |
18 | 8348.7(f), 8502(k) and 8535(3) of Title 24 are amended to read: |
19 | § 8326. Contributions by the Commonwealth. |
20 | (a) Contributions on behalf of active members.--The |
21 | Commonwealth shall make contributions into the fund on behalf of |
22 | all active members, including members on activated military |
23 | service leave, in an amount equal to one-half the amount |
24 | certified by the board as necessary to provide, together with |
25 | the members' contributions, annuity reserves on account of |
26 | prospective annuities as provided in this part in accordance |
27 | with section 8328[(a), (b), (c) and (e)] (relating to actuarial |
28 | cost method). In case a school employee has elected membership |
29 | in a retirement program approved by the employer, the |
30 | Commonwealth shall contribute to such program on account of his |
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1 | membership an amount no greater than the amount it would have |
2 | contributed had the employee been a member of the Public School |
3 | Employees' Retirement System. |
4 | * * * |
5 | § 8327. Payments by employers. |
6 | (a) General rule.--Each employer, including the Commonwealth |
7 | as employer of employees of the Department of Education, State- |
8 | owned colleges and universities, Thaddeus Stevens [State School] |
9 | College of Technology, [Pennsylvania State Oral] Western |
10 | Pennsylvania School for the Deaf, Scotland School for Veterans' |
11 | Children, and the Pennsylvania State University, shall make |
12 | payments to the fund each quarter in an amount equal to one-half |
13 | the sum of the percentages, as determined under section 8328 |
14 | (relating to actuarial cost method), applied to the total |
15 | compensation during the pay periods in the preceding quarter of |
16 | all its employees who were members of the system during such |
17 | period, including members on activated military service leave. |
18 | In the event a member on activated military service leave does |
19 | not return to service for the necessary time or receives an |
20 | undesirable, bad conduct or dishonorable discharge or does not |
21 | elect to receive credit for activated military service under |
22 | section 8302(b.1)(3) (relating to credited school service), the |
23 | contributions made by the employer on behalf of such member |
24 | shall be returned with valuation interest upon application by |
25 | the employer. |
26 | * * * |
27 | (c) Payments by employers after June 30, 1995.--After June |
28 | 30, 1995, each employer, including the Commonwealth as employer |
29 | of employees of the Department of Education, State-owned |
30 | colleges and universities, Thaddeus Stevens State School of |
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1 | Technology, [Pennsylvania State Oral] Western Pennsylvania |
2 | School for the Deaf, Scotland School for Veterans' Children and |
3 | The Pennsylvania State University, shall make payments to the |
4 | fund each quarter in an amount computed in the following manner: |
5 | (1) For an employer that is a school entity, the amount |
6 | shall be the sum of the percentages as determined under |
7 | section 8328 applied to the total compensation during the pay |
8 | periods in the preceding quarter of all employees who were |
9 | active members of the system during such period, including |
10 | members on activated military service leave. In the event a |
11 | member on activated military service leave does not return to |
12 | service for the necessary time or receives an undesirable, |
13 | bad conduct or dishonorable discharge or does not elect to |
14 | receive credit for activated military service under section |
15 | 8302(b.1)(3), the contribution made by the employer on behalf |
16 | of such member shall be returned with valuation interest upon |
17 | application by the employer. |
18 | (2) For an employer that is not a school entity, the |
19 | amount computed under subsection (a). |
20 | (3) For any employer, whether or not a school entity, in |
21 | computing the amount of payment due each quarter, there shall |
22 | be excluded from the total compensation referred to in this |
23 | subsection and subsection (a) any amount of compensation of a |
24 | noneligible member on the basis of which member contributions |
25 | have not been made by reason of the limitation under IRC § |
26 | 401(a)(17). Any amount of contribution to the fund paid by |
27 | the employer on behalf of a noneligible member on the basis |
28 | of compensation which was subject to exclusion from total |
29 | compensation in accordance with the provisions of this |
30 | paragraph shall, upon the board's determination or upon |
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1 | application by the employer, be returned to the employer with |
2 | valuation interest. |
3 | § 8328. Actuarial cost method. |
4 | (a) Employer contribution rate [on behalf of active |
5 | members].--The amount of the total employer contributions [on |
6 | behalf of all active members] shall be computed by the actuary |
7 | as a percentage of the total compensation of all active members |
8 | during the period for which the amount is determined and shall |
9 | be so certified by the board. The total employer contribution |
10 | rate shall be the sum of the final contribution rate as computed |
11 | in subsection (h) plus the premium assistance contribution rate |
12 | as computed in subsection (f). The [total] actuarially required |
13 | contribution rate [on behalf of all active members] shall |
14 | consist of the normal contribution rate as defined in subsection |
15 | (b), the accrued liability contribution rate as defined in |
16 | subsection (c) and the supplemental annuity contribution rate as |
17 | defined in subsection (d). Beginning July 1, 2004, the [total] |
18 | actuarially required contribution rate shall be modified by the |
19 | experience adjustment factors as calculated in subsection (e) |
20 | [but in no case shall it be less than 4% plus the premium |
21 | assistance contribution rate]. |
22 | (b) Normal contribution rate.--The normal contribution rate |
23 | shall be determined after each actuarial valuation. [Until all |
24 | accrued liability contributions have been completed, the] The |
25 | normal contribution rate shall be determined, on the basis of an |
26 | annual interest rate and such mortality and other tables as |
27 | shall be adopted by the board in accordance with generally |
28 | accepted actuarial principles, as a level percentage of the |
29 | compensation of the average new active member, which percentage, |
30 | if contributed on the basis of his prospective compensation |
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1 | through the entire period of active school service, would be |
2 | sufficient to fund the liability for any prospective benefit |
3 | payable to him, in excess of that portion funded by his |
4 | prospective member contributions[, except for the supplemental |
5 | benefits provided in sections 8348 (relating to supplemental |
6 | annuities), 8348.1 (relating to additional supplemental |
7 | annuities), 8348.2 (relating to further additional supplemental |
8 | annuities), 8348.3 (relating to supplemental annuities |
9 | commencing 1994), 8348.4 (relating to special supplemental |
10 | postretirement adjustment), 8348.5 (relating to supplemental |
11 | annuities commencing 1998), 8348.6 (relating to supplemental |
12 | annuities commencing 2002) and 8348.7 (relating to supplemental |
13 | annuities commencing 2003)]. |
14 | (c) Accrued liability contribution rate.-- |
15 | (1) For the fiscal [year] years beginning July 1, 2002, |
16 | and ending June 30, 2011, the accrued liability contribution |
17 | rate shall be computed as the rate of total compensation of |
18 | all active members which shall be certified by the actuary as |
19 | sufficient to fund over a period of ten years from July 1, |
20 | 2002, the present value of the liabilities for all |
21 | prospective benefits of active members, except for the |
22 | supplemental benefits provided in sections 8348 (relating to |
23 | supplemental annuities), 8348.1 (relating to additional |
24 | supplemental annuities), 8348.2 (relating to further |
25 | additional supplemental annuities), 8348.3 (relating to |
26 | supplemental annuities commencing 1994), 8348.4 (relating to |
27 | special supplemental postretirement adjustment), 8348.5 |
28 | (relating to supplemental annuities commencing 1998), 8348.6 |
29 | (relating to supplemental annuities commencing 2002) and |
30 | 8348.7 (relating to supplemental annuities commencing 2003), |
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1 | in excess of the total assets in the fund (calculated by |
2 | recognizing the actuarially expected investment return |
3 | immediately and recognizing the difference between the actual |
4 | investment return and the actuarially expected investment |
5 | return over a five-year period), excluding the balance in the |
6 | annuity reserve account, and of the present value of normal |
7 | contributions and of member contributions payable with |
8 | respect to all active members on July 1, 2002, during the |
9 | remainder of their active service. |
10 | (2) [Thereafter] For the fiscal years beginning July 1, |
11 | 2003, and ending June 30, 2011, the amount of each annual |
12 | accrued liability contribution shall be equal to the amount |
13 | of such contribution for the fiscal year, beginning July 1, |
14 | 2002, except that, if the accrued liability is increased by |
15 | legislation enacted subsequent to June 30, 2002, but before |
16 | July 1, 2003, such additional liability shall be funded over |
17 | a period of ten years from the first day of July, coincident |
18 | with or next following the effective date of the increase. |
19 | The amount of each annual accrued liability contribution for |
20 | such additional legislative liabilities shall be equal to the |
21 | amount of such contribution for the first annual payment. |
22 | (3) Notwithstanding any other provision of law, |
23 | beginning July 1, 2004, and ending June 30, 2011, the |
24 | outstanding balance of the increase in accrued liability due |
25 | to the change in benefits enacted in 2001 and the outstanding |
26 | balance of the net actuarial loss incurred in fiscal year |
27 | 2000-2001 shall be amortized in equal dollar annual |
28 | contributions over a period that ends 30 years after July 1, |
29 | 2002, and the outstanding balance of the net actuarial loss |
30 | incurred in fiscal year 2001-2002 shall be amortized in equal |
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1 | dollar annual contributions over a period that ends 30 years |
2 | after July 1, 2003. For fiscal years beginning on or after |
3 | July 1, 2004, if the accrued liability is increased by |
4 | legislation enacted subsequent to June 30, 2003, such |
5 | additional liability shall be funded in equal dollar annual |
6 | contributions over a period of ten years from the first day |
7 | of July coincident with or next following the effective date |
8 | of the increase. |
9 | (4) For the fiscal year beginning July 1, 2011, the |
10 | accrued liability contribution rate shall be computed as the |
11 | rate of total compensation of all active members which shall |
12 | be certified by the actuary as sufficient to fund as a level |
13 | percentage of compensation over a period of 30 years from |
14 | July 1, 2011, the present value of the liabilities for all |
15 | prospective benefits calculated as of June 30, 2010, |
16 | including the supplemental benefits as provided in sections |
17 | 8348, 8348.1, 8348.2, 8348.3, 8348.4, 8348.5, 8348.6 and |
18 | 8348.7, in excess of the actuarially calculated assets in the |
19 | fund (calculated recognizing all realized and unrealized |
20 | investment gains and losses each year in level annual |
21 | installments over a ten-year period). In the event that the |
22 | accrued liability is increased by legislation enacted |
23 | subsequent to June 30, 2010, such additional liability shall |
24 | be funded as a level percentage of compensation over a period |
25 | of ten years from the July 1 second succeeding the date such |
26 | legislation is enacted. |
27 | (d) Supplemental annuity contribution rate.--[Contributions] |
28 | (1) For the period of July 1, 2002, to June 30, 2011, |
29 | contributions from the Commonwealth and other employers |
30 | required to provide for the payment of the supplemental |
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1 | annuities provided for in sections 8348, 8348.1, 8348.2, |
2 | 8348.4 and 8348.5 shall be paid over a period of ten years |
3 | from July 1, 2002. The funding for the supplemental annuities |
4 | commencing 2002 provided for in section 8348.6 shall be as |
5 | provided in section 8348.6(f). The funding for the |
6 | supplemental annuities commencing 2003 provided for in |
7 | section 8348.7 shall be as provided in section 8348.7(f). The |
8 | amount of each annual supplemental annuities contribution |
9 | shall be equal to the amount of such contribution for the |
10 | fiscal year beginning July 1, 2002. [In the event that |
11 | supplemental annuities are increased by legislation enacted |
12 | subsequent to June 30, 2002, the additional liability for the |
13 | increased benefits to be amortized shall be funded in equal |
14 | dollar annual installments over a period of ten years.] |
15 | (2) For fiscal years beginning July 1, 2011, |
16 | contributions from the Commonwealth and other employers whose |
17 | employees are members of the system required to provide for |
18 | the payment of supplemental annuities as provided in sections |
19 | 8348, 8348.1, 8348.2, 8348.3, 8348.4, 8348.5, 8348.6 and |
20 | 8348.7 shall be paid as part of the accrued liability |
21 | contribution rate as provided for in subsection (c)(4), and |
22 | there shall not be a separate supplemental annuity |
23 | contribution rate attributable to those supplemental |
24 | annuities. In the event that supplemental annuities are |
25 | increased by legislation enacted subsequent to June 30, 2010, |
26 | the additional liability for the increase in benefits shall |
27 | be funded as a level percentage of compensation over a period |
28 | of ten years from the July 1 second succeeding the date such |
29 | legislation is enacted. |
30 | (e) Experience adjustment factor.-- |
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1 | (1) For each year after the establishment of the accrued |
2 | liability contribution rate for the fiscal year beginning |
3 | July 1, [2002] 2011, any increase or decrease in the unfunded |
4 | accrued liability, excluding the gains or losses on the |
5 | assets of the health insurance account, due to actual |
6 | experience differing from assumed experience, changes in |
7 | actuarial assumptions[,] or changes in the terms and |
8 | conditions of the benefits provided by the system by |
9 | judicial, administrative or other processes other than |
10 | legislation, including, but not limited to, reinterpretation |
11 | of the provisions of this part, shall be amortized [in equal |
12 | dollar annual contributions] as a level percentage of |
13 | compensation over a period of [ten] 30 years beginning with |
14 | the July 1 second succeeding the actuarial valuation |
15 | determining said increases or decreases. |
16 | (2) [Notwithstanding the provisions of paragraph (1), |
17 | for each year after the establishment of the accrued |
18 | liability contribution rate for the fiscal year beginning |
19 | July 1, 2003, any increase or decrease in the unfunded |
20 | accrued liability, excluding the gains or losses on the |
21 | assets of the health insurance account, due to actual |
22 | experience differing from assumed experience, changes in |
23 | actuarial assumptions, changes in the terms and conditions of |
24 | the benefits provided by the system by judicial, |
25 | administrative or other processes other than legislation, |
26 | including, but not limited to, reinterpretation of the |
27 | provisions of this part, shall be amortized in equal dollar |
28 | annual contributions over a period of 30 years beginning with |
29 | the July 1 second succeeding the actuarial valuation |
30 | determining said increases and decreases] (Reserved). |
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1 | (f) Premium assistance contribution rate.--For each fiscal |
2 | year beginning with July 1, 1991, the total contribution rate as |
3 | calculated according to this section shall be increased annually |
4 | in the full amount certified by the board as necessary to fund |
5 | the premium assistance program in accordance with section 8509 |
6 | (relating to health insurance premium assistance program), |
7 | notwithstanding any other provisions of this section. |
8 | (g) Temporary application of collared contribution rate.-- |
9 | (1) The collared contribution rate for each year shall |
10 | be determined by comparing the actuarially required |
11 | contribution rate, calculated without regard for the costs |
12 | added by legislation, to the prior year's final contribution |
13 | rate. |
14 | (2) If, for any of the fiscal years beginning July 1, |
15 | 2011, July 1, 2012, and on or after July 1, 2013, the |
16 | actuarially required contribution rate, calculated without |
17 | regard for the costs added by legislation, is more than 3%, |
18 | 3.5% and 4.5%, respectively, of the total compensation of all |
19 | active members greater than the prior year's final |
20 | contribution rate, then the collared contribution rate shall |
21 | be applied and be equal to the prior year's final |
22 | contribution rate increased by 3%, 3.5% and 4.5%, |
23 | respectively, of total compensation of all active members. |
24 | Otherwise, and for all other fiscal years, the collared |
25 | contribution rate shall not be applicable. In no case shall |
26 | the collared contribution rate be less than 4% of the total |
27 | compensation of all active members. |
28 | (h) Final contribution rate.-- |
29 | (1) For the fiscal year beginning July 1, 2010, the |
30 | final contribution rate shall be 5% of the total compensation |
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1 | of all active members. For each subsequent fiscal year for |
2 | which the collared contribution rate is applicable, the final |
3 | contribution rate shall be the collared contribution rate as |
4 | calculated in subsection (g), plus the costs added by |
5 | legislation. |
6 | (2) For all other fiscal years, the final contribution |
7 | rate shall be the actuarially required contribution rate, |
8 | provided that the final contribution rate shall not be less |
9 | than the normal contribution rate as provided in subsection |
10 | (b). |
11 | (i) Definitions.--As used in this section, the following |
12 | words and phrases shall have the meanings given to them in this |
13 | subsection unless the context clearly indicates otherwise: |
14 | "Actuarially required contribution rate." The sum of the |
15 | following: |
16 | (1) the normal contribution rate as calculated in |
17 | subsection (b); |
18 | (2) the accrued liability contribution rate as |
19 | calculated in subsection (c); |
20 | (3) the supplemental annuity contribution rate as |
21 | calculated in subsection (d); |
22 | (4) the experience adjustment factor as calculated in |
23 | subsection (e); and |
24 | (5) any costs added by legislation enacted prior to the |
25 | last actuarial valuation. |
26 | "Costs added by legislation." The sum, if positive, of all |
27 | changes in the actuarially required contribution rate resulting |
28 | from legislation enacted in the year since the last actuarial |
29 | valuation and not included in the determination of the prior |
30 | year's final contribution rate, computed as the rate of total |
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1 | compensation of all active members certified by the actuary as |
2 | sufficient to make the employer normal contributions and |
3 | sufficient to amortize legislatively created changes in the |
4 | unfunded actuarial liability as a level percentage of |
5 | compensation over a period of ten years from the July 1 second |
6 | succeeding the date of enactment. |
7 | § 8348.1. Additional supplemental annuities. |
8 | * * * |
9 | (f) Funding.--The actuary shall annually certify the amount |
10 | of Commonwealth appropriations for the next fiscal year needed |
11 | to fund, over a period of ten years from July 1, 2002, the |
12 | additional monthly supplemental annuity provided for in this |
13 | section[. The board shall submit the actuary's certification to |
14 | the Secretary of the Budget on or before November 1 of each |
15 | year. If, in any year after 1984, the amount certified is |
16 | disapproved under section 610 of the act of April 9, 1929 |
17 | (P.L.177, No.175), known as The Administrative Code of 1929, as |
18 | insufficient to meet the funding requirements of this subsection |
19 | or is not appropriated on or before July 1, the additional |
20 | supplemental annuity provided for in this section shall be |
21 | suspended until such time as an amount certified and approved as |
22 | sufficient is appropriated], which amounts shall be paid during |
23 | the period beginning July 1, 2002, and ending June 30, 2011. For |
24 | fiscal years beginning on or after July 1, 2011, the additional |
25 | liability provided in this section shall be funded as part of |
26 | the actuarial accrued liability as provided in section 8328 |
27 | (relating to actuarial cost method). |
28 | * * * |
29 | § 8348.2. Further additional supplemental annuities. |
30 | * * * |
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1 | (f) Funding.--The actuary shall annually estimate the amount |
2 | of Commonwealth appropriations for the next fiscal year needed |
3 | to fund, over a period of ten years from July 1, 2002, the |
4 | additional monthly supplemental annuity provided for in this |
5 | section[. The board shall submit the actuary's estimation to the |
6 | Secretary of the Budget on or before November 1 of each year. |
7 | If, in any year after 1988, the amount estimated is disapproved |
8 | under section 610 of the act of April 9, 1929 (P.L.177, No.175), |
9 | known as The Administrative Code of 1929, as insufficient to |
10 | meet the funding requirements of this subsection or is not |
11 | appropriated on or before July 1, the additional supplemental |
12 | annuity provided for in this section shall be suspended until |
13 | such time as an amount certified and approved as sufficient is |
14 | appropriated], which amounts shall be paid during the period |
15 | beginning July 1, 2002, and ending June 30, 2011. For fiscal |
16 | years beginning on or after July 1, 2011, the additional |
17 | liability provided in this section shall be funded as part of |
18 | the actuarial accrued liability as provided in section 8328 |
19 | (relating to actuarial cost method). |
20 | * * * |
21 | § 8348.3. Supplemental annuities commencing 1994. |
22 | * * * |
23 | (f) Funding.--[The] |
24 | (1) For the period beginning July 1, 2002, and ending |
25 | June 30, 2011, the additional liability for the increase in |
26 | benefits provided in this section shall be funded in equal |
27 | dollar annual installments over a period of ten years |
28 | beginning July 1, 2002. |
29 | (2) For fiscal years beginning on or after July 1, 2011, |
30 | the additional liability provided in this section shall be |
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1 | funded as part of the actuarial accrued liability as provided |
2 | in section 8328 (relating to actuarial cost method). |
3 | * * * |
4 | § 8348.5. Supplemental annuities commencing 1998. |
5 | * * * |
6 | (f) Funding.--[The] |
7 | (1) For the period beginning July 1, 2002, and ending |
8 | June 30, 2011, the additional liability for the increase in |
9 | benefits provided in this section shall be funded in equal |
10 | dollar annual installments over a period of ten years |
11 | beginning July 1, 2002. |
12 | (2) For fiscal years beginning on or after July 1, 2011, |
13 | the additional liability provided in this section shall be |
14 | funded as part of the actuarial accrued liability as provided |
15 | in section 8328 (relating to actuarial cost method). |
16 | (3) Notwithstanding the provisions of section 212 of the |
17 | act of April 22, 1998 (P.L.1341, No.6A), known as the General |
18 | Appropriation Act of 1998, regarding payment for cost-of- |
19 | living increases for annuitants, payments for cost-of-living |
20 | increases for annuitants shall be made under section 8535 |
21 | (relating to payments to school entities by Commonwealth). |
22 | * * * |
23 | § 8348.6. Supplemental annuities commencing 2002. |
24 | * * * |
25 | (f) Funding.--[The] |
26 | (1) For the period beginning July 1, 2002, and ending |
27 | June 30, 2011, the additional liability for the increase in |
28 | benefits provided in this section shall be funded in equal |
29 | dollar annual installments over a period of ten years |
30 | beginning July 1, 2003. |
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1 | (2) For fiscal years beginning on or after July 1, 2011, |
2 | the additional liability provided in this section shall be |
3 | funded as part of the actuarial accrued liability as provided |
4 | in section 8328 (relating to actuarial cost method). |
5 | * * * |
6 | § 8348.7. Supplemental annuities commencing 2003. |
7 | * * * |
8 | (f) Funding.--[The] |
9 | (1) For the period beginning July 1, 2002, and ending |
10 | June 30, 2011, the additional liability for the increase in |
11 | benefits provided in this section shall be funded in equal |
12 | dollar annual installments over a period of ten years |
13 | beginning July 1, 2004. |
14 | (2) For fiscal years beginning on or after July 1, 2011, |
15 | the additional liability provided in this section shall be |
16 | funded as part of the actuarial accrued liability as provided |
17 | in section 8328 (relating to actuarial cost method). |
18 | * * * |
19 | § 8502. Administrative duties of board. |
20 | * * * |
21 | (k) Certification of employer contributions.--The board |
22 | shall, each year in addition to the itemized budget required |
23 | under section 8330 (relating to appropriations by the |
24 | Commonwealth), certify to the employers and the Commonwealth the |
25 | employer contribution rate expressed as a percentage of members' |
26 | payroll necessary for the funding of prospective annuities for |
27 | active members and the annuities of annuitants, and certify the |
28 | rates and amounts of the normal contributions as determined |
29 | pursuant to section 8328(b) (relating to actuarial cost method), |
30 | accrued liability contributions as determined pursuant to |
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1 | section 8328(c), supplemental annuities contribution rate as |
2 | determined pursuant to section 8328(d) [and], the experience |
3 | adjustment factor as determined pursuant to section 8328(e) |
4 | [and], premium assistance contributions as determined pursuant |
5 | to section 8328(f), the costs added by legislation as determined |
6 | pursuant to section 8328(i), the actuarial required contribution |
7 | rate as determined pursuant to section 8328(i), the collared |
8 | contribution rate as determined pursuant to section 8328(g) and |
9 | the final contribution rate as determined pursuant to section |
10 | 8328(h), which shall be paid to the fund and credited to the |
11 | appropriate accounts. These certifications shall be regarded as |
12 | final and not subject to modification by the [Budget Secretary] |
13 | Secretary of the Budget. |
14 | * * * |
15 | § 8535. Payments to school entities by Commonwealth. |
16 | For each school year beginning with the 1995-1996 school |
17 | year, each school entity shall be paid by the Commonwealth for |
18 | contributions based upon school service of active members of the |
19 | system after June 30, 1995, as follows: |
20 | * * * |
21 | (3) School entities shall have up to five days after |
22 | receipt of the Commonwealth's portion of the employer's |
23 | liability to make payment to the Public School Employees' |
24 | Retirement Fund. School entities are expected to make the |
25 | full payment to the Public School Employees' Retirement Fund |
26 | in accordance with section 8327 (relating to payments by |
27 | employers) in the event the receipt of the Commonwealth's |
28 | portion of the employer's liability is delayed because of |
29 | delinquent salary reporting or other conduct by the school |
30 | entities. |
|
1 | Section 3. Title 71 is amended by adding a section to read: |
2 | § 5501.1. Definitions. |
3 | The following words and phrases when used in this chapter |
4 | shall have the meanings given to them in this section unless the |
5 | context clearly indicates otherwise: |
6 | "Actuarially required contribution rate." The employer |
7 | contribution rate as calculated pursuant to section 5508(a), |
8 | (b), (c), (e) and (f) (relating to actuarial cost method). |
9 | "Costs added by legislation." The sum, if positive, of all |
10 | changes in the actuarially required contribution rate resulting |
11 | from legislation enacted in the year since the last actuarial |
12 | valuation and not included in the determination of the prior |
13 | year's final contribution rate, computed as the rate of total |
14 | compensation of all active members certified by the actuary as |
15 | sufficient to make the employer normal contributions and |
16 | sufficient to amortize legislatively created changes in the |
17 | unfunded actuarial liability as a level percentage of |
18 | compensation over a period of ten years from the July 1 |
19 | following the valuation date. |
20 | Section 4. Sections 5507, 5508, 5708.1(f), 5708.2(f), |
21 | 5708.3(f), 5708.5(f), 5708.6(f), 5708.7(f), 5708.8(g), 5902(k), |
22 | 5934 and 5938 of Title 71 are amended to read: |
23 | § 5507. Contributions by the Commonwealth and other employers. |
24 | (a) Contributions on behalf of active members.--The |
25 | Commonwealth and other employers whose employees are members of |
26 | the system shall make contributions to the fund on behalf of all |
27 | active members in such amounts as shall be certified by the |
28 | board as necessary to provide, together with the members' total |
29 | accumulated deductions, annuity reserves on account of |
30 | prospective annuities other than those provided in section 5708 |
|
1 | (relating to supplemental annuities), 5708.1 (relating to |
2 | additional supplemental annuities), 5708.2 (relating to further |
3 | additional supplemental annuities), 5708.3 (relating to |
4 | supplemental annuities commencing 1994), 5708.4 (relating to |
5 | special supplemental postretirement adjustment), 5708.5 |
6 | (relating to supplemental annuities commencing 1998), 5708.6 |
7 | (relating to supplemental annuities commencing 2002), 5708.7 |
8 | (relating to supplemental annuities commencing 2003) and 5708.8 |
9 | (relating to special supplemental postretirement adjustment of |
10 | 2002), in accordance with the actuarial cost method provided in |
11 | section 5508(a), (b), (c), (d) and (f) (relating to actuarial |
12 | cost method). |
13 | (b) Contributions on behalf of annuitants.--The Commonwealth |
14 | and other employers whose employees are members of the system |
15 | shall make contributions on behalf of annuitants in such amounts |
16 | as shall be certified by the board as necessary to fund the |
17 | liabilities for supplemental annuities in accordance with the |
18 | actuarial cost method provided in section 5508(e) (relating to |
19 | actuarial cost method). |
20 | (c) Contributions transferred by county retirement |
21 | systems.-- |
22 | (1) Each county retirement system or pension plan which |
23 | is notified by certification from the board that a former |
24 | contributor who was transferred to State employment pursuant |
25 | to 42 Pa.C.S. § 1905 (relating to county-level court |
26 | administrators) has elected to convert county service to |
27 | State service in accordance with section 5303.1 (relating to |
28 | election to convert county service to State service) shall |
29 | transfer to the board an amount equal to the actuarial |
30 | liability for the additional benefits that result in the |
|
1 | system as a result of the conversion as certified by the |
2 | board. This amount shall be calculated in such a manner and |
3 | using such actuarial factors and assumptions as the board, |
4 | after obtaining the advice of its actuary, shall determine |
5 | and shall be calculated by determining the present value of |
6 | the future benefits for the former county contributors and |
7 | subtracting from that present value the present value of |
8 | future employee contributions and future employer normal cost |
9 | contributions. |
10 | (2) The transfer shall occur no later than 180 days |
11 | after the certification by the board of the actuarial |
12 | liability for the additional benefits or 30 days following |
13 | the date of termination of service if the member terminates |
14 | State service after making the election to convert service, |
15 | whichever occurs first. |
16 | (3) If any county retirement system or pension plan |
17 | fails to transfer, within the required time, the money |
18 | certified by the board under this subsection, then the |
19 | service of such members for the period of converted service |
20 | shall be credited, and the board shall notify the county |
21 | which employed the employee who is converting the county |
22 | service and the State Treasurer of the amount due. The State |
23 | Treasurer shall withhold out of any grants, subsidies or |
24 | other payments from the State General Fund appropriation or |
25 | appropriations next due such county an amount equal to the |
26 | amount which the county retirement system or pension plan |
27 | failed to pay and shall pay the amount so withheld to the |
28 | board for the payment of the amount due from that county's |
29 | retirement system or pension plan for the converted service. |
30 | (d) Payment of final contribution rate.--Notwithstanding the |
|
1 | calculation of the actuarially required contribution rate and |
2 | the provisions of subsections (a) and (b), the Commonwealth and |
3 | other employers whose employees are members of the system shall |
4 | make contributions to the fund on behalf of all active members |
5 | and annuitants in such amounts as shall be certified by the |
6 | board in accordance with section 5508(i). |
7 | (e) Benefits completion plan contributions.--In addition to |
8 | all other contributions required under this section and section |
9 | 5508, the Commonwealth and other employers shall make |
10 | contributions as certified by the board pursuant to section 5941 |
11 | (relating to benefits completion plan). |
12 | § 5508. Actuarial cost method. |
13 | (a) Employer contribution rate on behalf of active |
14 | members.--The amount of the Commonwealth and other employer |
15 | contributions on behalf of all active members shall be computed |
16 | by the actuary as a percentage of the total compensation of all |
17 | active members during the period for which the amount is |
18 | determined and shall be so certified by the board. The [total |
19 | employer] actuarially required contribution rate on behalf of |
20 | all active members shall consist of the employer normal |
21 | contribution rate, as defined in subsection (b), and the accrued |
22 | liability contribution rate as defined in subsection (c). The |
23 | [total employer] actuarially required contribution rate on |
24 | behalf of all active members shall be modified by the experience |
25 | adjustment factor as calculated in subsection (f) [but in no |
26 | case shall it be less than zero. The total employer contribution |
27 | rate shall be modified by the experience adjustment factor as |
28 | calculated in subsection (f), but in no case shall it be less |
29 | than: |
30 | (1) 2% for the fiscal year beginning July 1, 2004; |
|
1 | (2) 3% for the fiscal year beginning July 1, 2005; and |
2 | (3) 4% for the fiscal year beginning July 1, 2006, and |
3 | thereafter]. |
4 | (b) Employer normal contribution rate.--The employer normal |
5 | contribution rate shall be determined after each actuarial |
6 | valuation on the basis of an annual interest rate and such |
7 | mortality and other tables as shall be adopted by the board in |
8 | accordance with generally accepted actuarial principles. The |
9 | employer normal contribution rate shall be determined as a level |
10 | percentage of the compensation of the average new active member, |
11 | which percentage, if contributed on the basis of his prospective |
12 | compensation through his entire period of active State service, |
13 | would be sufficient to fund the liability for any prospective |
14 | benefit payable to him[, except for the supplemental benefits |
15 | provided for in sections 5708 (relating to supplemental |
16 | annuities), 5708.1 (relating to additional supplemental |
17 | annuities), 5708.2 (relating to further additional supplemental |
18 | annuities), 5708.3 (relating to supplemental annuities |
19 | commencing 1994), 5708.4 (relating to special supplemental |
20 | postretirement adjustment), 5708.5 (relating to supplemental |
21 | annuities commencing 1998), 5708.6 (relating to supplemental |
22 | annuities commencing 2002), 5708.7 (relating to supplemental |
23 | annuities commencing 2003) and 5708.8 (relating to special |
24 | supplemental postretirement adjustment of 2002),] in excess of |
25 | that portion funded by his prospective member contributions. |
26 | (c) Accrued liability contribution rate.-- |
27 | (1) For the fiscal [year] years beginning July 1, 2002, |
28 | and July 1, 2003, the accrued liability contribution rate |
29 | shall be computed as the rate of total compensation of all |
30 | active members which shall be certified by the actuary as |
|
1 | sufficient to fund over a period of ten years from July 1, |
2 | 2002, the present value of the liabilities for all |
3 | prospective benefits, except for the supplemental benefits as |
4 | provided in sections 5708 (relating to supplemental |
5 | annuities), 5708.1 (relating to additional supplemental |
6 | annuities), 5708.2 (relating to further additional |
7 | supplemental annuities), 5708.3 (relating to supplemental |
8 | annuities commencing 1994), 5708.4 (relating to special |
9 | supplemental postretirement adjustment), 5708.5 (relating to |
10 | supplemental annuities commencing 1998), 5708.6 (relating to |
11 | supplemental annuities commencing 2002), 5708.7 (relating to |
12 | supplemental annuities commencing 2003) and 5708.8 (relating |
13 | to special supplemental postretirement adjustment of 2002), |
14 | in excess of the total assets in the fund (calculated |
15 | recognizing all investment gains and losses over a five-year |
16 | period), excluding the balance in the supplemental annuity |
17 | account, and the present value of employer normal |
18 | contributions and of member contributions payable with |
19 | respect to all active members on December 31, 2001, and |
20 | excluding contributions to be transferred by county |
21 | retirement systems or pension plans pursuant to section |
22 | 5507(c) (relating to contributions by the Commonwealth and |
23 | other employers). The amount of each annual accrued liability |
24 | contribution shall be equal to the amount of such |
25 | contribution for the fiscal year beginning July 1, 2002, |
26 | except that, if the accrued liability is increased by |
27 | legislation enacted subsequent to June 30, 2002, but before |
28 | July 1, 2003, such additional liability shall be funded over |
29 | a period of ten years from the first day of July, coincident |
30 | with or next following the effective date of the increase. |
|
1 | The amount of each annual accrued liability contribution for |
2 | such additional legislative liabilities shall be equal to the |
3 | amount of such contribution for the first annual payment. |
4 | (2) Notwithstanding any other provision of law, |
5 | beginning July 1, 2004, and ending June 30, 2010, the |
6 | outstanding balance of the increase in accrued liability due |
7 | to the change in benefits enacted in 2001 shall be amortized |
8 | in equal dollar annual contributions over a period that ends |
9 | 30 years after July 1, 2002, and the outstanding balance of |
10 | the net actuarial loss incurred in calendar year 2002 shall |
11 | be amortized in equal dollar annual contributions over a |
12 | period that ends 30 years after July 1, 2003. For fiscal |
13 | years beginning on or after July 1, 2004, and ending June 30, |
14 | 2010, if the accrued liability is increased by legislation |
15 | enacted subsequent to June 30, 2003, but before January 1, |
16 | 2009, such additional liability shall be funded in equal |
17 | dollar annual contributions over a period of ten years from |
18 | the first day of July coincident with or next following the |
19 | effective date of the increase. |
20 | (3) For the fiscal year beginning July 1, 2010, the |
21 | accrued liability contribution rate shall be computed as the |
22 | rate of total compensation of all active members which shall |
23 | be certified by the actuary as sufficient to fund as a level |
24 | percentage of compensation over a period of 30 years from |
25 | July 1, 2010, the present value of the liabilities for all |
26 | prospective benefits calculated as of the immediately prior |
27 | valuation date, including the supplemental benefits as |
28 | provided in sections 5708, 5708.1, 5708.2, 5708.3, 5708.4, |
29 | 5708.5, 5708.6, 5708.7 and 5708.8, but excluding the benefits |
30 | payable from the retirement benefit plan established pursuant |
|
1 | to section 5941 (relating to benefits completion plan), in |
2 | excess of the actuarially calculated assets in the fund |
3 | (calculated recognizing all realized and unrealized |
4 | investment gains and losses each year in level annual |
5 | installments over five years), including the balance in the |
6 | supplemental annuity account, and the present value of |
7 | employer normal contributions and of member contributions |
8 | payable with respect to all active members, inactive members |
9 | on leave without pay, vestees and special vestees on December |
10 | 31, 2009. If the accrued liability is changed by legislation |
11 | enacted subsequent to December 31, 2009, such change in |
12 | liability shall be funded as a level percentage of |
13 | compensation over a period of ten years from the first day of |
14 | July following the valuation date coincident with or next |
15 | following the date such legislation is enacted. |
16 | (d) Special provisions on calculating contributions.--In |
17 | calculating the contributions required by subsections (a), (b) |
18 | and (c), the active members of Class C shall be considered to be |
19 | members of Class A. In addition, the actuary shall determine the |
20 | Commonwealth or other employer contributions required for active |
21 | members of Class C and officers of the Pennsylvania State Police |
22 | and enforcement officers and investigators of the Pennsylvania |
23 | Liquor Control Board who are members of Class A to finance their |
24 | benefits in excess of those to which other members of Class A |
25 | are entitled. Such additional contributions shall be determined |
26 | separately for officers and employees of the Pennsylvania State |
27 | Police and for enforcement officers and investigators of the |
28 | Pennsylvania Liquor Control Board. Such contributions payable on |
29 | behalf of officers and employees of the Pennsylvania State |
30 | Police shall include the amounts received by the system under |
|
1 | the provisions of the act of May 12, 1943 (P.L.259, No.120), |
2 | referred to as the Foreign Casualty Insurance Premium Tax |
3 | Allocation Law, and on behalf of enforcement officers or |
4 | investigators of the Pennsylvania Liquor Control Board, the |
5 | amounts received by the system under the provisions of the act |
6 | of April 12, 1951 (P.L.90, No.21), known as the Liquor Code. |
7 | (e) Supplemental annuity contribution rate.--[Contributions] |
8 | (1) For the period July 1, 2002, to June 30, 2010, |
9 | contributions from the Commonwealth and other employers whose |
10 | employees are members of the system required to provide for |
11 | the payment of supplemental annuities as provided in sections |
12 | 5708, 5708.1, 5708.2, 5708.3, 5708.4 and 5708.5 shall be paid |
13 | over a period of ten years from July 1, 2002. The funding for |
14 | the supplemental annuities commencing 2002 provided for in |
15 | section 5708.6 shall be as provided in section 5708.6(f). The |
16 | funding for the supplemental annuities commencing 2003 |
17 | provided for in section 5708.7 shall be as provided in |
18 | section 5708.7(f). The funding for the special supplemental |
19 | postretirement adjustment of 2002 under section 5708.8 shall |
20 | be as provided in section 5708.8(g). The amount of each |
21 | annual supplemental annuities contribution shall be equal to |
22 | the amount of such contribution for the fiscal year beginning |
23 | July 1, 2002. [In the event that supplemental annuities are |
24 | increased by legislation enacted subsequent to June 30, 2002, |
25 | the additional liability for the increase in benefits shall |
26 | be funded in equal dollar annual installments over a period |
27 | of ten years from the July first, coincident with or next |
28 | following the effective date of such legislation.] |
29 | (2) For fiscal years beginning on or after July 1, 2010, |
30 | contributions from the Commonwealth and other employers whose |
|
1 | employees are members of the system required to provide for |
2 | the payment of supplemental annuities as provided in sections |
3 | 5708, 5708.1, 5708.2, 5708.3, 5708.4, 5708.5, 5708.6, 5708.7 |
4 | and 5708.8 shall be paid as part of the accrued liability |
5 | contribution rate as provided for in subsection (c)(3) and |
6 | there shall not be a separate supplemental annuity |
7 | contribution rate attributable to those supplemental |
8 | annuities. In the event that supplemental annuities are |
9 | increased by legislation enacted subsequent to December 31, |
10 | 2009, the additional liability for the increase in benefits |
11 | shall be funded as a level percentage of compensation over a |
12 | period of ten years from the first day of July following the |
13 | valuation date coincident with or next following the date |
14 | such legislation is enacted. |
15 | (f) Experience adjustment factor.-- |
16 | (1) For each year after the establishment of the accrued |
17 | liability contribution rate and the supplemental annuity |
18 | contribution rate for the fiscal year beginning July 1, |
19 | [2002] 2010, any increase or decrease in the unfunded accrued |
20 | liability[, including liability] and any increase or decrease |
21 | in the liabilities and funding for supplemental annuities, |
22 | due to actual experience differing from assumed experience[,] |
23 | (recognizing all realized and unrealized investment gains and |
24 | losses over a five-year period), changes in contributions |
25 | caused by the final contribution rate being different from |
26 | the actuarially required contribution rate, changes in |
27 | actuarial assumptions[,] or changes in the terms and |
28 | conditions of the benefits provided by the system by |
29 | judicial, administrative or other processes other than |
30 | legislation, including, but not limited to, reinterpretation |
|
1 | of the provisions of this part, shall be amortized [in equal |
2 | dollar annual contributions] as a level percentage of |
3 | compensation over a period of [ten] 30 years beginning with |
4 | the July 1 succeeding the actuarial valuation determining |
5 | said increases or decreases. |
6 | (2) [Notwithstanding the provisions of paragraph (1), |
7 | for each year after the establishment of the accrued |
8 | liability contribution rate for the fiscal year beginning |
9 | July 1, 2003, any increase or decrease in the unfunded |
10 | accrued liability due to actual experience differing from |
11 | assumed experience, changes in actuarial assumptions, changes |
12 | in the terms and conditions of the benefits provided by the |
13 | system by judicial, administrative or other processes other |
14 | than legislation, including, but not limited to, |
15 | reinterpretation of the provisions of this part, shall be |
16 | amortized in equal dollar annual contributions over a period |
17 | of 30 years beginning with the July 1 succeeding the |
18 | actuarial valuation determining said increases and decreases] |
19 | The actuarially required contribution rate shall be the sum |
20 | of the normal contribution rate, the accrued liability |
21 | contribution rate and the supplemental annuity contribution |
22 | rate, modified by the experience adjustment factor as |
23 | calculated in paragraph (1). |
24 | (g) Determination of liability for special vestee.-- |
25 | Notwithstanding any other provision of this part or other law, |
26 | the total additional accrued actuarial liability resulting from |
27 | eligibility of special vestees for benefits upon the attainment |
28 | of superannuation age shall be determined by the actuary as part |
29 | of the first annual valuation made after June 30, 1997. The |
30 | resulting additional accrued actuarial liability shall be paid |
|
1 | by The Pennsylvania State University to the board in one lump |
2 | sum payment within 90 days of the board's certification of the |
3 | amount to The Pennsylvania State University. |
4 | (h) Temporary application of collared contribution rate.-- |
5 | The collared contribution rate for each year shall be determined |
6 | by comparing the actuarially required contribution rate |
7 | calculated without regard for costs added by legislation to the |
8 | prior year's final contribution rate. If for any of the fiscal |
9 | years beginning July 1, 2011, July 1, 2012 and on or after July |
10 | 1, 2013, the actuarially required contribution rate calculated |
11 | without regard for costs added by legislation is more than 3%, |
12 | 3.5% and 4.5%, respectively, of the total compensation of all |
13 | active members greater than the prior year's final contribution |
14 | rate, then the collared contribution rate shall be applied and |
15 | be equal to the prior year's final contribution rate increased |
16 | by the respective percentage above of total compensation of all |
17 | active members. Otherwise, and for all subsequent fiscal years, |
18 | the collared contribution rate shall not be applicable. In no |
19 | case shall the collared contribution rate be less than 4% of |
20 | total compensation of all active members. |
21 | (i) Final contribution rate.--For the fiscal year beginning |
22 | July 1, 2010, the final contribution rate shall be 5% of total |
23 | compensation of all active members. For each subsequent fiscal |
24 | year for which the collared contribution rate is applicable, the |
25 | final contribution rate shall be the collared contribution rate |
26 | plus the costs added by legislation. For all other fiscal years, |
27 | the final contribution rate shall be the actuarially required |
28 | contribution rate, provided that the final contribution rate |
29 | shall not be less than the employer normal contribution rate, as |
30 | defined in subsection (b). |
|
1 | § 5708.1. Additional supplemental annuities. |
2 | * * * |
3 | (f) Funding.--The actuary shall annually certify the amount |
4 | of appropriations for the next fiscal year needed to fund, over |
5 | a period of ten years from July 1, 2002, the additional monthly |
6 | supplemental annuity provided for in this section[. The board |
7 | shall submit the actuary's certification to the Secretary of the |
8 | Budget on or before November 1 of each year. If, in any year |
9 | after 1984, the amount certified is disapproved under section |
10 | 610 of the act of April 9, 1929 (P.L.177, No.175), known as The |
11 | Administrative Code of 1929, as insufficient to meet the funding |
12 | requirements of this subsection or is not appropriated on or |
13 | before July 1, the additional supplemental annuity provided for |
14 | in this section shall be suspended until such time as an amount |
15 | certified and approved as sufficient is appropriated], which |
16 | amounts shall be paid during the period beginning July 1, 2002, |
17 | and ending June 30, 2010. For fiscal years beginning on or after |
18 | July 1, 2010, the additional liability provided in this section |
19 | shall be funded as part of the actuarial accrued liability as |
20 | provided in section 5508 (relating to actuarial cost method). |
21 | * * * |
22 | § 5708.2. Further additional supplemental annuities. |
23 | * * * |
24 | (f) Funding.--The actuary shall annually estimate the amount |
25 | of Commonwealth appropriations for the next fiscal year needed |
26 | to fund, over a period of ten years from July 1, 2002, the |
27 | additional monthly supplemental annuity provided for in this |
28 | section[. The board shall submit the actuary's estimation to the |
29 | Secretary of the Budget on or before November 1 of each year. |
30 | If, in any year after 1988, the amount estimated is disapproved |
|
1 | under section 610 of the act of April 9, 1929 (P.L.177, No.175), |
2 | known as The Administrative Code of 1929, as insufficient to |
3 | meet the funding requirements of this subsection or is not |
4 | appropriated on or before July 1, the additional supplemental |
5 | annuity provided for in this section shall be suspended until |
6 | such time as an amount certified and approved as sufficient is |
7 | appropriated], which amounts shall be paid during the period |
8 | beginning July 1, 2002, and ending June 30, 2010. For fiscal |
9 | years beginning on or after July 1, 2010, the additional |
10 | liability provided in this section shall be funded as part of |
11 | the actuarial accrued liability as provided in section 5508 |
12 | (relating to actuarial cost method). |
13 | * * * |
14 | § 5708.3. Supplemental annuities commencing 1994. |
15 | * * * |
16 | (f) Funding.--[The] For the period beginning July 1, 2002, |
17 | and ending June 30, 2010, the additional liability for the |
18 | increase in benefits provided in this section shall be funded in |
19 | equal dollar annual installments over a period of ten years |
20 | beginning July 1, 2002. For fiscal years beginning on or after |
21 | July 1, 2010, the additional liability for the increase in |
22 | benefits provided in this section shall be funded as part of the |
23 | actuarial accrued liability as provided in section 5508 |
24 | (relating to actuarial cost method). |
25 | * * * |
26 | § 5708.5. Supplemental annuities commencing 1998. |
27 | * * * |
28 | (f) Funding.--[The] For the period beginning July 1, 2002, |
29 | and ending June 30, 2010, the additional liability for the |
30 | increase in benefits provided in this section shall be funded in |
|
1 | equal dollar annual installments over a period of ten years |
2 | beginning July 1, 2002. For fiscal years beginning on or after |
3 | July 1, 2010, the additional liability for the increase in |
4 | benefits provided in this section shall be funded as part of the |
5 | actuarial accrued liability as provided in section 5508 |
6 | (relating to actuarial cost method). |
7 | * * * |
8 | § 5708.6. Supplemental annuities commencing 2002. |
9 | * * * |
10 | (f) Funding.--[The] For the period beginning July 1, 2003, |
11 | and ending June 30, 2010, the additional liability for the |
12 | increase in benefits provided in this section shall be funded in |
13 | equal dollar annual installments over a period of ten years |
14 | beginning July 1, 2003. For fiscal years beginning on or after |
15 | July 1, 2010, the additional liability for the increase in |
16 | benefits provided in this section shall be funded as part of the |
17 | actuarial accrued liability as provided in section 5508 |
18 | (relating to actuarial cost method). |
19 | * * * |
20 | § 5708.7. Supplemental annuities commencing 2003. |
21 | * * * |
22 | (f) Funding.--[The] For the period beginning July 1, 2004, |
23 | and ending June 30, 2010, the additional liability for the |
24 | increase in benefits provided in this section shall be funded in |
25 | equal dollar annual installments over a period of ten years |
26 | beginning July 1, 2004. For fiscal years beginning on or after |
27 | July 1, 2010, the additional liability for the increase in |
28 | benefits provided in this section shall be funded as part of the |
29 | actuarial accrued liability as provided in section 5508 |
30 | (relating to actuarial cost method). |
|
1 | * * * |
2 | § 5708.8. Special supplemental postretirement adjustment of |
3 | 2002. |
4 | * * * |
5 | (g) Funding.--[The] For the period beginning July 1, 2003, |
6 | and ending June 30, 2010, the additional liability for the |
7 | increase in benefits provided in this section shall be funded in |
8 | equal dollar annual installments over a period of ten years |
9 | beginning July 1, 2003. For fiscal years beginning on or after |
10 | July 1, 2010, the additional liability for the increase in |
11 | benefits provided in this section shall be funded as part of the |
12 | actuarial accrued liability as provided in section 5508 |
13 | (relating to actuarial cost method). |
14 | * * * |
15 | § 5902. Administrative duties of the board. |
16 | * * * |
17 | (k) Certification of employer contributions.--The board |
18 | shall, each year in addition to the itemized budget required |
19 | under section 5509 (relating to appropriations and assessments |
20 | by the Commonwealth), certify, as a percentage of the members' |
21 | payroll, the employers' contributions as determined pursuant to |
22 | section 5508 (relating to actuarial cost method) necessary for |
23 | the funding of prospective annuities for active members and the |
24 | annuities of annuitants and certify the rates and amounts of the |
25 | employers' normal contributions as determined pursuant to |
26 | section 5508(b), accrued liability contributions as determined |
27 | pursuant to section 5508(c), supplemental annuities contribution |
28 | rate as determined pursuant to section 5508(e) [and], the |
29 | experience adjustment factor as determined pursuant to section |
30 | 5508(f), the collared contribution rate pursuant to section |
|
1 | 5508(h) and the final contribution rate pursuant to section |
2 | 5508(i), which shall be paid to the fund and credited to the |
3 | appropriate accounts. The board may allocate the final |
4 | contribution rate and certify various employer contribution |
5 | rates based upon the different benefit eligibility, class of |
6 | service multiplier, superannuation age and other benefit |
7 | differences resulting from State service credited for individual |
8 | members even though such allocated employer contribution rate on |
9 | behalf of any given member may be more or less than 5% of the |
10 | member's compensation for the period from July 1, 2010, to June |
11 | 30, 2011, or may differ from the prior year's contribution for |
12 | that member by more or less than the percentages used to |
13 | calculate the collared contribution rate for that year and may |
14 | be below any minimum contribution rate established for the |
15 | collared contribution rate or final contribution rate. These |
16 | certifications shall be regarded as final and not subject to |
17 | modification by the [Budget Secretary] Secretary of the Budget. |
18 | * * * |
19 | § 5934. State accumulation account. |
20 | The State accumulation account shall be the ledger account to |
21 | which shall be credited all contributions of the Commonwealth or |
22 | other employers whose employees are members of the system and |
23 | made in accordance with the provisions of section 5507(a) or (d) |
24 | (relating to contributions by the Commonwealth and other |
25 | employers) except that the amounts received under the provisions |
26 | of the act of May 12, 1943 (P.L.259, No.120), and the amounts |
27 | received under the provisions of the Liquor Code, act of April |
28 | 12, 1951 (P.L.90, No.21), shall be credited to the State Police |
29 | benefit account or the enforcement officers' benefit account as |
30 | the case may be. All amounts transferred to the fund by county |
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1 | retirement systems or pension plans in accordance with the |
2 | provisions of section 5507(c) also shall be credited to the |
3 | State accumulation account. All amounts transferred to the fund |
4 | by the Public School Employees' Retirement System in accordance |
5 | with section 5303.2(e) (relating to election to convert school |
6 | service to State service), except amounts credited to the |
7 | members' savings account, and all amounts paid by the Department |
8 | of Corrections in accordance with section 5303.2(f) also shall |
9 | be credited to the State accumulation account. The State |
10 | accumulation account shall be credited with valuation interest. |
11 | The reserves necessary for the payment of annuities and death |
12 | benefits as approved by the board and as provided in Chapter 57 |
13 | (relating to benefits) shall be transferred from the State |
14 | accumulation account to the annuity reserve account provided for |
15 | in section 5935 (relating to annuity reserve account), except |
16 | that the reserves necessary on account of a member who is an |
17 | officer of the Pennsylvania State Police or an enforcement |
18 | officer shall be transferred from the State accumulation account |
19 | to the State Police benefit account provided for in section 5936 |
20 | (relating to State Police benefit account) or to the enforcement |
21 | officers' benefit account as provided for in section 5937 |
22 | (relating to enforcement officers' benefit account) as the case |
23 | may be. The reserves necessary for the payment of supplemental |
24 | annuities in excess of those reserves credited to the |
25 | supplemental annuity account on June 30, 2010, shall be |
26 | transferred from the State accumulation account to the |
27 | supplemental annuity account. In the event that supplemental |
28 | annuities are increased by legislation enacted subsequent to |
29 | December 31, 2009, the necessary reserves shall be transferred |
30 | from the State accumulation account to the supplemental annuity |
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1 | account. |
2 | § 5938. Supplemental annuity account. |
3 | The supplemental annuity account shall be the ledger account |
4 | to which shall be credited all contributions from the |
5 | Commonwealth and other employers in accordance with section |
6 | 5507(b) (relating to contributions by the Commonwealth and other |
7 | employers) for the payment of the supplemental annuities |
8 | provided in sections 5708 (relating to supplemental annuities), |
9 | 5708.1 (relating to additional supplemental annuities), 5708.2 |
10 | (relating to further additional supplemental annuities), 5708.3 |
11 | (relating to supplemental annuities commencing 1994), 5708.4 |
12 | (relating to special supplemental postretirement adjustment), |
13 | 5708.5 (relating to supplemental annuities commencing 1998), |
14 | 5708.6 (relating to supplemental annuities commencing 2002), |
15 | 5708.7 (relating to supplemental annuities commencing 2003) and |
16 | 5708.8 (relating to special supplemental postretirement |
17 | adjustment of 2002) made before July 1, 2010, the amount |
18 | transferred from the State accumulation account to provide all |
19 | additional reserves necessary as of June 30, 2010, to pay such |
20 | supplemental annuities and adjustments, and the amounts |
21 | transferred from the State accumulation account to provide all |
22 | additional reserves necessary as a result of supplemental |
23 | annuities enacted after December 31, 2009. The supplemental |
24 | annuity account shall be credited with valuation interest. The |
25 | reserves necessary for the payment of such supplemental |
26 | annuities shall be transferred from the supplemental annuity |
27 | account to the annuity reserve account as provided in section |
28 | 5935 (relating to annuity reserve account). |
29 | Section 5. Contribution rates shall remain in effect until |
30 | June 30, 2010, as follows: |
|
1 | (1) Notwithstanding the provisions of this act, the |
2 | employer contribution rates certified by the Public School |
3 | Employees' Retirement Board for fiscal year 2009-2010 shall |
4 | remain in effect until June 30, 2010. |
5 | (2) Notwithstanding the provisions of this act, the |
6 | employer contribution rates certified by the State Employees' |
7 | Retirement Board for fiscal year 2009-2010 shall remain in |
8 | effect until June 30, 2010. |
9 | Section 6. Recertification to the Secretary of the Budget |
10 | shall be as follows: |
11 | (1) Notwithstanding any other provisions of law to the |
12 | contrary, the Public School Employees' Retirement Board |
13 | shall, effective for the fiscal year beginning July 1, 2010, |
14 | recertify to the Secretary of the Budget, within 15 days of |
15 | the effective date of this act, employer contributions, |
16 | rates, factors and amounts set forth in 24 Pa.C.S. § 8502(k), |
17 | as amended by this act. The recertification shall supersede |
18 | the prior certification for all purposes. |
19 | (2) Notwithstanding any other provision of law to the |
20 | contrary, the State Employees' Retirement Board shall, |
21 | effective for the fiscal year beginning July 1, 2010, |
22 | recertify to the Secretary of the Budget, within 15 days of |
23 | the effective date of this act, the contributions, rates, |
24 | factors and amounts set forth in 71 Pa.C.S. § 5902(k), as |
25 | amended by this act. The recertification shall supersede the |
26 | prior certification for all purposes. |
27 | Section 7. Certain public officials shall be held harmless, |
28 | as follows: |
29 | (1) Notwithstanding any other provision of law, |
30 | fiduciary requirement, actuarial standard of practice or |
|
1 | other requirement to the contrary, the members of the Public |
2 | School Employees' Retirement Board, the actuary and other |
3 | employees and officials of the Public School Employees' |
4 | Retirement System shall not be held liable or in breach or |
5 | violation of any law or standard either as individuals or in |
6 | their official capacity or as a governmental or corporate |
7 | entity for any action or calculation related to calculating |
8 | and certifying a final contribution rate as provided for in |
9 | this act that is different from the actuarially required |
10 | contribution rate as otherwise appropriately calculated under |
11 | the provisions of the Public School Employees' Retirement |
12 | Code. |
13 | (2) Notwithstanding any other provision of law, |
14 | fiduciary requirement, actuarial standard of practice or |
15 | other requirement to the contrary, the members of the State |
16 | Employees' Retirement Board, the actuary and other employees |
17 | and officials of the State Employees' Retirement System shall |
18 | not be held liable or in breach or violation of any law or |
19 | standard either as individuals or in their official capacity |
20 | or as a governmental or corporate entity for any action or |
21 | calculation related to calculating and certifying a final |
22 | contribution rate as provided for in this act that is |
23 | different from the actuarially required contribution rate as |
24 | otherwise appropriately calculated under the provisions of |
25 | the State Employees' Retirement Code. |
26 | Section 8. Construction of a calculation or actuarial method |
27 | shall be as follows: |
28 | (1) Nothing in this act shall be construed or deemed to |
29 | imply that any calculation or actuarial method used by the |
30 | Public School Employees' Retirement Board, its actuaries or |
|
1 | the Public School Employees' Retirement System was not in |
2 | accordance with the provisions of the Public School |
3 | Employees' Retirement Code or other applicable law prior to |
4 | the enactment of this act. |
5 | (2) Nothing in this act shall be construed or deemed to |
6 | imply that any calculation or actuarial method used by the |
7 | State Employees' Retirement Board, its actuaries or the State |
8 | Employees' Retirement System was not in accordance with the |
9 | provisions of the State Employees' Retirement Code or other |
10 | applicable law prior to the enactment of this act. |
11 | Section 9. This act shall take effect immediately. |
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