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06/20/2024 03:06 PM
Pennsylvania House of Representatives
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=H&SPick=20150&cosponId=19812
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House Co-Sponsorship Memoranda

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House of Representatives
Session of 2015 - 2016 Regular Session

MEMORANDUM

Posted: March 7, 2016 03:20 PM
From: Representative Rick Saccone
To: All House members
Subject: Reducing State Pension Risk and Liability
 
In the near future, I plan to introduce legislation that will end the option for school and state employees to receive a higher 2.5% benefit accrual for their pension. When this option was created under Act 120 of 2010, it was intended to be actuarially neutral as public employees would contribute more of their salary for the higher benefit.
Since that time however, the 8% investment return assumption has been lowered for both SERS and PSERS to 7.5%. Many pension experts and actuaries argue assumed rates of return must go even lower. As a result, the election for higher benefits at Act 120 employee contribution rates is costing taxpayers more in pension liabilities. Phasing out the higher benefit class for new hires is a step in the right direction for reducing taxpayer risk and future unfunded liabilities.
Please join me in cosponsoring this legislation.



Introduced as HB2049