Regular Session 2021-2022 House Bill 2237 P.N. 2592

PRINTER'S NO. 2592

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

2237

Session of

2022

INTRODUCED BY WHITE, BERNSTINE, BRIGGS, BROOKS, CIRESI, DEASY,

DRISCOLL, ECKER, FARRY, GALLOWAY, GILLEN, GLEIM, HARKINS,

HARRIS, HILL-EVANS, HOHENSTEIN, JAMES, JOZWIAK, KAIL,

KNOWLES, KULIK, LEWIS DELROSSO, M. MACKENZIE, R. MACKENZIE,

MAJOR, MARKOSEK, MATZIE, McNEILL, MIHALEK, MILLARD, NEILSON,

O'MARA, O'NEAL, PENNYCUICK, PICKETT, POLINCHOCK, RIGBY,

ROTHMAN, SAINATO, SCHWEYER, SOLOMON AND THOMAS,

JANUARY 11, 2022

REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, JANUARY 11, 2022

AN ACT

Amending the act of December 14, 1988 (P.L.1192, No.147),

entitled "An act requiring municipal retirement systems to

pay special ad hoc postretirement adjustments to certain

retired police officers and firefighters; providing for the

financing of these adjustments; providing for the

administration of the Commonwealth's reimbursements for these

adjustments; and making repeals," providing for 2022 special

ad hoc municipal police postretirement adjustment; in

financing of special ad hoc adjustment, further providing for

reimbursement by Commonwealth for 2002 special ad hoc

adjustment; and, in administrative provisions, further

providing for municipal retirement system certification of

adjustments paid and of reimbursable amounts and for

municipal receipt of reimbursable payment.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The act of December 14, 1988 (P.L.1192, No.147),

known as the Special Ad Hoc Municipal Police and Firefighter

Postretirement Adjustment Act, is amended by adding a chapter to

read:

CHAPTER 4-A

2022 SPECIAL AD HOC MUNICIPAL POLICE

POSTRETIREMENT ADJUSTMENT

Section 401-A. Entitlement to 2023 special ad hoc

postretirement adjustment.

A municipal retirement system shall pay a retired police

officer a special ad hoc postretirement adjustment under this

chapter if all of the following apply:

(1) The retiree has terminated active employment with

the municipality as a police officer.

(2) The retiree is receiving a retirement benefit from a

municipal retirement system on the basis of active employment

with the municipality as a police officer.

(3) The retiree began receiving the retirement benefit

before January 1, 2018.

Section 402-A. Amount of 2023 special ad hoc postretirement

adjustment.

(a) General rule.--Except as provided in subsections (b) and

(c), a municipal retirement system shall pay a retired police

officer a monthly special ad hoc postretirement adjustment under

section 401-A that shall be calculated as follows:

(1) The base adjustment shall be determined by

multiplying 20¢ by the years of service and then multiplying

that product by the years on retirement.

(2) The longevity factor shall be determined as the sum

of the products calculated by multiplying 0.025 by the years

on retirement and 0.05 by the years on retirement in excess

of 25, if any.

(3) The longevity adjustment shall be determined by

multiplying the base adjustment calculated under paragraph

(1) by the longevity factor calculated under paragraph (2).

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(4) The special ad hoc postretirement adjustment payable

under section 401-A shall be the sum of the base adjustment

calculated under paragraph (1) and the longevity adjustment

calculated under paragraph (3).

(b) Limitation.--If, under section 401-A, a retiree is

entitled to be paid a special ad hoc postretirement adjustment

by more than one municipal retirement system, the amount of the

special ad hoc postretirement adjustment under subsection (a)

shall be reduced so that the total of all these adjustments paid

to the retiree does not exceed the amount specified in

subsection (a).

postretirement adjustment.--The amount of the special ad hoc

postretirement adjustment calculated under subsection (a) shall

be reduced annually by 65% of the total amount of any

postretirement adjustments provided to the retiree under the

municipal retirement plan after January 1, 2002, and before

December 31, 2022, and paid in the immediately preceding year.

Section 2. Sections 502.1, 901(a)(2) and 903(b) of the act

are amended to read:

Section 502.1. Reimbursement by Commonwealth for 2002 and 2023

special ad hoc adjustment.

(a) General rule.--

(1) Except as provided in subsection (b), beginning in

the year following the year in which the amortization

contribution requirement attributable to a special ad hoc

postretirement adjustment under [Chapter 4 is] Chapters 4 and

4-A are first reflected in the financial requirements of the

retirement system determined under Chapter 3 of the act of

December 18, 1984 (P.L.1005, No.205), known as the Municipal

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Pension Plan Funding Standard and Recovery Act, the Auditor

General shall determine the Commonwealth reimbursement

payable to the municipality representing the amortization

contribution requirement attributable to the special ad hoc

postretirement adjustment under [Chapter 4] Chapters 4 and 4-

A that was paid with revenues of the municipality other than

general municipal pension system State aid provided under the

Municipal Pension Plan Funding Standard and Recovery Act.

(2) The determination of the reimbursable amount of the

amortization contribution requirement attributable to the

special ad hoc postretirement adjustment under [Chapter 4]

Chapters 4 and 4-A in any year shall be calculated as the

amortization contribution requirement attributable to the

special ad hoc postretirement adjustments under [Chapter 4]

Chapters 4 and 4-A and reflected in the determination of the

financial requirements of the pension plan under Chapter 3 of

the Municipal Pension Plan Funding Standard and Recovery Act

for the immediate prior year less the product of that

amortization contribution requirement multiplied by the ratio

of the amount of general municipal pension system State aid

allocated to the retirement system in the immediate prior

year to the total amount of municipal contributions made to

the retirement system from all sources other than employee

contributions in the immediate prior year. Where a

municipality has issued bonds or notes to fund an unfunded

actuarial accrued liability under 53 Pa.C.S. Pt. V Subpt. B

(relating to indebtedness and borrowing) or under other laws

applicable to the municipality, the general municipal pension

system State aid and municipal contributions used by the

municipality to make debt service payments on the bonds or

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notes, or both, issued to fund an unfunded actuarial accrued

liability shall be included in the calculation of the ratio

applied to the amortization contribution requirement.

(3) The Commonwealth shall reimburse a municipality,

from the special account established under section 701, for

the reimbursable amount determined for each year under this

paragraph.

(b) Limitation of eligibility.--

(1) The Commonwealth shall not reimburse any

municipality for a special ad hoc adjustment paid under

[Chapter 4] Chapters 4 and 4-A if the information required

under section 901(a)(2) either was not certified to the

Auditor General or was certified after April 1 of the year

the certification was due.

(2) The Commonwealth shall not reimburse a municipality

for the reimbursable amount of the amortization contribution

requirement attributable to the special ad hoc postretirement

adjustment under [Chapter 4] Chapters 4 and 4-A if the

municipality fails to submit a complete certification of the

reimbursable amount of the amortization contribution

requirement determined under subsection (a) to the Auditor

General before April 1 of the year in which the reimbursement

is payable.

requirement.--For purposes of this section, the term

"amortization contribution requirement" shall have the meaning

specified in this subsection as follows:

(1) In a municipal pension plan with defined benefits

for which the municipality determines the financial

requirements of the pension plan under section 302 of the

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Municipal Pension Plan Funding Standard and Recovery Act, the

term "amortization contribution requirement" shall mean the

amortization contribution requirement attributable to the

special ad hoc postretirement adjustments under [Chapter 4]

Chapters 4 and 4-A that was reflected in the financial

requirements of the pension plan determined for the immediate

prior year.

(2) In a municipal pension plan without defined benefits

for which the municipality determines the financial

requirements of the pension plan under section 303 of the

Municipal Pension Plan Funding Standard and Recovery Act, the

term "amortization contribution requirement" shall mean the

sum of the payments made to the retirement system in the

immediate prior year in order to provide the special ad hoc

postretirement adjustments under [Chapter 4] Chapters 4 and

4-A in that year.

Section 901. Municipal retirement system certification of

adjustments paid and of reimbursable amounts.

(a) Certification.--

* * *

(2) Beginning in the year 2002, a municipality with a

retirement system that pays a special ad hoc postretirement

adjustment under [Chapter 4] Chapters 4 and 4-A in a year

shall certify its reimbursable amount under section 502.1(a)

to the Auditor General not later than April 1 of the

following year.

* * *

Section 903. Municipal receipt of reimbursement payment.

* * *

(b) 2002 or 2023 postretirement adjustment reimbursement.--

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Upon receipt of the reimbursement payment from the Commonwealth

for the postretirement adjustments under [Chapter 4] Chapters 4

and 4-A, the treasurer of the municipality shall deposit the

reimbursement payment into the municipality's general fund.

Section 3. The special ad hoc postretirement adjustment

under section 401-A shall take effect on the date of the first

retirement benefit made after January 1, 2023. If the special ad

hoc postretirement adjustment under section 401-A is not

included in the initial retirement benefit payment occurring

after January 1, 2023, the special ad hoc postretirement

adjustment shall be included as soon as practicable in the

retirement benefit payment of the retiree, and the initial

retirement benefit payment that includes the special ad hoc

postretirement adjustment shall also include the total amount of

the special ad hoc postretirement adjustments previously omitted

from the retirement benefit payments made after January 1, 2023.

Section 4. This act shall take effect immediately.

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