1Amending Titles 24 (Education) and 71 (State Government) of the
2Pennsylvania Consolidated Statutes, providing for permanent
3cost-of-living increases for retirees.

4The General Assembly of the Commonwealth of Pennsylvania
5hereby enacts as follows:

6Section 1. Title 24 of the Pennsylvania Consolidated
7Statutes is amended by adding a section to read:

8§ 8348.8. Supplemental annuities commencing 2013.

9(a) Benefits.--Commencing with the first monthly annuity
10payment after July 1, 2013, any eligible benefit recipient shall
11be entitled to receive a further additional monthly supplemental
12annuity from the system. This shall be in addition to the
13supplemental annuities provided for in sections 8348 (relating
14to supplemental annuities), 8348.1 (relating to additional
15supplemental annuities), 8348.2 (relating to further additional
16supplemental annuities), 8348.3 (relating to supplemental
17annuities commencing 1994), 8348.4 (relating to special
18supplemental postretirement adjustment), 8348.5 (relating to

1supplemental annuities commencing 1998), 8348.6 (relating to
2supplemental annuities commencing 2002) and 8348.7 (relating to
3supplemental annuities commencing 2003).

4(b) Amount of supplemental annuity.--The amount of the
5supplemental annuity payable pursuant to this section shall be
6an amount equal to the increase in the Consumer Price Index for
7Urban Wage Earners for the immediately preceding calendar year.

8(c) Payment.--The supplemental annuity provided under this
9section shall be paid automatically unless the annuitant files a
10written notice with the board requesting that the additional
11monthly supplemental annuity not be paid.

12(d) Conditions.--The supplemental annuity provided under
13this section shall be payable under the same terms and
14conditions as provided under the option plan in effect as of
15July 1, 2011.

16(e) Benefits to beneficiaries or survivors.--No supplemental
17annuity provided under this section shall be payable to the
18beneficiary or survivor annuitant of a member who dies before
19July 1, 2011.

20(f) Funding.--

21(1) Notwithstanding section 8328 (relating to actuarial
22cost method), the additional liability for the increase in
23benefits provided in this section shall be funded in annual
24installments increasing by 5% each year over a period of 20
25years beginning July 1, 2013.

26(2) Notwithstanding the provisions of the act of July 1,
272004 (P.L.1837, No.7A), known as the General Appropriation
28Act of 2004, regarding payment for cost-of-living increases
29for annuitants, payments for cost-of-living increases for
30annuitants shall be made under section 8535 (relating to

1payments to school entities by Commonwealth).

2(g) Eligible benefit recipient.--As used in this section, 
3the term "eligible benefit recipient" means a person who is 
4receiving a superannuation, withdrawal or disability annuity on 
5July 1, 2013, and whose most recent effective date of retirement 
6is prior to July 1, 2012, but the supplemental annuities 
7provided under this section shall not be payable to an annuitant 
8receiving a withdrawal annuity prior to the first day of July 
9coincident with or following the annuitant's attainment of 
10superannuation age.

11Section 2. Title 71 is amended by adding a section to read:

12§ 5708.9. Supplemental annuities commencing 2013.

13(a) Benefits.--Commencing with the first monthly annuity
14payment after June 30, 2013, any eligible benefit recipient
15shall be entitled to receive a supplemental monthly annuity from
16the system. This shall be in addition to the supplemental
17annuities provided for in sections 5708 (relating to
18supplemental annuities), 5708.1 (relating to additional
19supplemental annuities), 5708.2 (relating to further additional
20supplemental annuities), 5708.3 (relating to supplemental
21annuities commencing 1994), 5708.5 (relating to supplemental
22annuities commencing 1998) 5708.6 (relating to supplemental
23annuities commencing 2002), 5708.7 (relating to supplemental
24annuities commencing 2003) and the special supplemental
25postretirement adjustments provided for in sections 5708.4
26(relating to special supplemental postretirement adjustment) and
275708.8 (relating to special supplemental postretirement
28adjustment of 2002).

29(b) Amount of supplemental annuity.--The amount of the
30supplemental annuity payable pursuant to this section shall be

1an amount equal to the increase in the Consumer Price Index for
2Urban Wage Earners for the immediately preceding calendar year.

3(c) Payment.--The supplemental annuity provided under this
4section shall be paid automatically unless the annuitant files a
5written notice with the board requesting that the additional
6monthly supplemental annuity not be paid.

7(d) Conditions.--The supplemental annuity provided under
8this section shall be payable under the same terms and
9conditions as provided under the option plan in effect as of
10July 1, 2007.

11(e) Benefits paid to beneficiaries or survivors.--No
12supplemental annuity provided under this section shall be
13payable to the beneficiary or survivor annuitant of a member who
14dies before July 1, 2013.

15(f) Funding.--Notwithstanding section 5508(e) (relating to
16actuarial cost method), the additional liability for the
17increase in benefits provided in this section shall be funded in
18annual installments increasing by 5% each year over a period of
1920 years beginning July 1, 2013.

20(g) Eligible benefit recipient.--As used in this section, 
21the term "eligible benefit recipient" means a person who is 
22receiving a superannuation, withdrawal or disability annuity on 
23July 1, 2013, and whose most recent effective date of retirement 
24is prior to July 1, 2012, but the supplemental annuities 
25provided under this section shall not be payable to an annuitant 
26receiving a withdrawal annuity prior to the first day of July 
27coincident with or following the annuitant's attainment of 
28superannuation age.

29Section 3. This act shall take effect immediately.