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Senate of Pennsylvania
Session of 2017 - 2018 Regular Session

MEMORANDUM

Posted: May 3, 2017 10:29 AM
From: Senator John P. Blake
To: All Senate members
Subject: Statewide Municipal Police Pension Reform
 
In the near future I will reintroduce Senate Bill 903 of the 2015-2016 Legislative Session, which would amend the Pennsylvania Municipal Retirement System law to create a statewide pension system for police officers. This proposal will be a Senate companion to a House proposal by our colleague – Representative Tom Caltagirone.

Currently there are too many police pension plans in Pennsylvania, over 900 currently exist. Of these plans, sixty nine percent (69%) contain fewer than ten (10) members. Recent figures show that the average cost of administering a plan of ten (10) or fewer members is $1,568 per member whereas the cost of administering the plan with 500 or more members is only $334 per member. By creating a uniform statewide pension plan for municipal police officers, local municipalities will begin to see relief in administrative costs associated with those plans while police officers will have more stability in their pensions. All newly-hired municipal officers would be enrolled in the new statewide plan; existing plans and employees could opt-in to the statewide plan if the existing plan is 100% funded and 75% of the active members of the plan vote to opt-in.

The plan would also make significant changes to contract negotiations between police officers and their employers. With a mandated statewide police pension plan for new officers, the discussion of pension benefits would be eliminated at the bargaining table. In addition, the statewide municipal police pension would allow members’ pension benefits to be “portable” meaning that an officer could move to another municipal police force and retain his or her accrued pension benefit, without the need to start over. Other key components of the legislation include anti-spiking provisions, no cost of living adjustments (commonly referred to as COLAs), and requiring employees to contribute 7.5% of their salary to the system.

This is not a “bail out” for existing police plans that are not fully funded; however, the creation of a statewide plan could encourage municipal plans to raise their funded status to 100% to qualify for the new plan.
By enacting these prudent changes in the way we run municipal police pensions, we can provide opportunities for savings to our communities that are clamoring for assistance with their fiscal affairs. Please show your support of both local governments and law enforcement by signing on as a co-sponsor to this legislation. Last session's cosponsors included Senators Rafferty, Teplitz, Costa, Greenleaf, Pileggi, Mensch and Ward.