PRINTER'S NO. 988
No. 129 Session of 2001
INTRODUCED BY BENNINGHOFF, HANNA, ARGALL, ALLEN, ARMSTRONG,
BASTIAN, BEBKO-JONES, BELARDI, BROWNE, CALTAGIRONE, CAPPELLI,
CASORIO, M. COHEN, COSTA, DeWEESE, FAIRCHILD, FEESE, FICHTER,
FLEAGLE, FRANKEL, GEIST, GEORGE, GORDNER, GRUCELA, HALUSKA,
HARHAI, HARHART, HENNESSEY, HERMAN, HERSHEY, HORSEY,
HUTCHINSON, LAUGHLIN, LEH, MANN, MARSICO, McCALL, McILHATTAN,
MUNDY, ORIE, PETRONE, PIPPY, PISTELLA, READSHAW, SAINATO,
SATHER, SHANER, B. SMITH, SOLOBAY, STABACK, STERN,
E. Z. TAYLOR, J. TAYLOR, TRAVAGLIO, VEON, WALKO, WANSACZ,
WILT, WOJNAROSKI AND YOUNGBLOOD, MARCH 12, 2001
REFERRED TO COMMITTEE ON STATE GOVERNMENT, MARCH 12, 2001
AN ACT
1 Amending Title 71 (State Government) of the Pennsylvania
2 Consolidated Statutes, further providing for definitions and
3 for benefits for employees of the Department of Corrections.
4 The General Assembly of the Commonwealth of Pennsylvania
5 hereby enacts as follows:
6 Section 1. The definition of "class of service multiplier"
7 in section 5102 of Title 71 of the Pennsylvania Consolidated
8 Statutes is amended and the section is amended by adding
9 definitions to read:
10 § 5102. Definitions.
11 The following words and phrases as used in this part, unless
12 a different meaning is plainly required by the context, shall
13 have the following meanings:
14 * * *
1 "Class of service multiplier."
2 Class of Service Multiplier
3 A 1
4 B .625
5 C 1
6 D 1.25
7 D-1 prior to
8 January 1, 1973 1.875
9 D-1 on and
10 subsequent to
11 January 1, 1973 1.731
12 D-2 prior to
13 January 1, 1973 2.5
14 D-2 on and
15 subsequent to
16 January 1, 1973 1.731
17 D-3 prior to
18 January 1, 1973 3.75
19 D-3 on and
20 subsequent to
21 January 1, 1973 1.731 except prior to December
22 1, 1974 as applied to any
23 additional legislative
24 compensation as an officer
25 of the General Assembly
26 3.75
27 E, E-1 prior to
28 January 1, 1973 2 for each of the first ten
29 years of judicial service,
30 and
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1 1.5 for each subsequent year
2 of judicial service
3 E, E-1 on and
4 subsequent to
5 January 1, 1973 1.50 for each of the first
6 ten years of judicial
7 service and
8 1.125 for each subsequent year
9 of judicial service
10 E-2 prior to
11 September 1, 1973 1.5
12 E-2 on and
13 subsequent to
14 September 1, 1973 1.125
15 G 0.417
16 H 0.500
17 I 0.625
18 J 0.714
19 K 0.834
20 L 1.000
21 M 1.100
22 N 1.250
23 P 1
24 T-C (Public School 1
25 Employees'
26 Retirement Code)
27 * * *
28 "Highest annual salary." The highest compensation received
29 for service as a prison security officer during any calendar
30 year during which the member was employed as a prison security
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1 officer for the entire calendar year. In the case of a member
2 who first became a member on or after January 1, 1996, the
3 highest annual salary shall be determined as hereinabove
4 provided but subject to the application of the provisions of
5 section 5506.1(a) (relating to annual compensation limit under
6 IRC § 401(a)(17)).
7 * * *
8 "Prison security officer." A full coverage member who is a
9 correction officer who has not been an officer of the
10 Pennsylvania State Police on or after July 1, 1989, and is
11 classified under the Commonwealth's employee classification plan
12 as either a corrections officer trainee, corrections officer 1,
13 corrections officer 2, corrections officer 3, corrections
14 officer 4, or such predecessor or successor classifications as
15 determined by the board to be functionally the same as the
16 classifications listed here.
17 * * *
18 Section 2. Sections 5303(b)(1), 5304(a), 5306(a) and (b) and
19 5308(c) of Title 71 are amended to read:
20 § 5303. Retention and reinstatement of service credits.
21 * * *
22 (b) Eligibility points for prospective credited service.--
23 (1) Every active member of the system or a multiple
24 service member who is a school employee and a member of the
25 Public School Employees' Retirement System on or after the
26 effective date of this part shall receive eligibility points
27 in accordance with section 5307 for current State service,
28 previous State service, or creditable nonstate service upon
29 compliance with sections 5501 (relating to regular member
30 contributions for current service), 5504 (relating to member
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1 contributions for the purchase of credit for previous State
2 service or to become a full coverage member), 5505 (relating
3 to contributions for the purchase of credit for creditable
4 nonstate service), 5505.1 (relating to additional member
5 contributions) or 5506 (relating to incomplete payments). The
6 class or classes of service in which the member may be
7 credited for previous State service prior to the effective
8 date of this part shall be the class or classes in which he
9 was or could have at any time elected to be credited for such
10 service, provided that eligibility for Class P credit shall
11 be limited in accordance with section 5306 (relating to
12 classes of service). The class of service in which a member
13 shall be credited for service subsequent to the effective
14 date of this part shall be determined in accordance with
15 section 5306 [(relating to classes of service)].
16 * * *
17 § 5304. Creditable nonstate service.
18 (a) Eligibility.--An active member or a multiple service
19 member who is a school employee and an active member of the
20 Public School Employees' Retirement System shall be eligible for
21 Class A service credit for creditable nonstate service as set
22 forth in subsections (b) and (c) except that intervening
23 military service shall be credited in the class of service for
24 which the member was eligible at the time of entering into
25 military service and for which he makes the required
26 contributions[.] and except that military service credited
27 pursuant to subsection (c)(2) to a member who is a prison
28 security officer at the time the military service is credited
29 shall be Class P service.
30 * * *
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1 § 5306. Classes of service.
2 (a) Class A membership.--A State employee, other than a
3 prison security officer, who is a member of Class A on the
4 effective date of this part or who becomes a member of the
5 system subsequent to the effective date of this part shall be
6 classified as a Class A member and receive credit for Class A
7 service upon payment of regular and additional member
8 contributions for Class A service.
9 (b) Other class membership.--
10 (1) A State employee who is a member of a class of
11 service other than Class A on the effective date of this part
12 shall retain his membership in that class until such service
13 is discontinued; any service other than service as a prison
14 security officer thereafter shall be credited as Class A
15 service.
16 (2) (i) A prison security officer shall be classified
17 as a Class P member and any service performed as a prison
18 security officer on or after the effective date of this
19 paragraph shall be credited as Class P service.
20 (ii) An active member or inactive member on leave
21 without pay who is a prison security officer on the
22 effective date of this paragraph, shall have all service
23 as a prison security officer prior to the effective date
24 of this paragraph credited as Class P service.
25 (iii) An active member or inactive member on leave
26 without pay who is a prison security officer on the
27 effective date of this paragraph and who prior to the
28 effective date of this paragraph had military service
29 credited as creditable nonstate service pursuant to
30 section 5304 (relating to creditable nonstate service) or
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1 credited as State service pursuant to the laws of this
2 Commonwealth or the United States, shall have all such
3 military service credited as Class P service instead of
4 the class in which it was previously credited.
5 (iv) In the event a member has Class P service and
6 service other than Class P service credited in the same
7 calendar year and the aggregate amount of each class of
8 service calculated without regard to any other class of
9 service totals more than one year, then each class of
10 service shall be credited proportionally, not to exceed
11 one year in total service.
12 * * *
13 § 5308. Eligibility for annuities.
14 * * *
15 (c) Disability annuity.--An active member or inactive member
16 on leave without pay who has credit for at least five years of
17 service or any active member or inactive member on leave without
18 pay who is an officer of the Pennsylvania State Police, a prison
19 security officer or an enforcement officer shall, upon
20 compliance with section 5907(k), be entitled to a disability
21 annuity if he becomes mentally or physically incapable of
22 continuing to perform the duties for which he is employed and
23 qualifies in accordance with the provisions of section
24 5905(c)(1) (relating to duties of the board regarding
25 applications and elections of members).
26 Section 3. Section 5508 of Title 71 is amended by adding a
27 subsection to read:
28 § 5508. Actuarial cost method.
29 * * *
30 (h) Determination of liability for Class P service.--
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1 Notwithstanding any other provision of this part or other law,
2 the total additional accrued actuarial liability resulting from
3 Class P service shall be determined by the actuary as part of
4 the first annual valuation made after the effective date of this
5 subsection. The resulting additional accrued actuarial liability
6 shall be paid by the Department of Corrections in annual
7 payments over a period of 20 years from the first day of July,
8 coincident with or next following the first valuation made after
9 the effective date of this subsection. The amount of each annual
10 accrued liability contribution for Class P service shall be 5%
11 greater than the amount of such contribution for the previous
12 fiscal year.
13 Section 4. Section 5702(a) of Title 71 is amended to read:
14 § 5702. Maximum single life annuity.
15 (a) General rule.--Any full coverage member who is eligible
16 to receive an annuity pursuant to the provisions of section
17 5308(a) or (b) (relating to eligibility for annuities) shall be
18 entitled to receive a maximum single life annuity attributable
19 to his credited service and equal to the sum of the following
20 single life annuities beginning at the effective date of
21 retirement:
22 (1) [A] One of the following single life annuities:
23 (i) If a member has less than ten years of credited
24 Class P service, then a standard single life annuity
25 multiplied by the sum of the products, determined
26 separately for each class of service, obtained by
27 multiplying the appropriate class of service multiplier
28 by the ratio of years of service credited in that class
29 to the total credited service. In case the member on the
30 effective date of retirement is under superannuation age
20010H0129B0988 - 8 -
1 for any service, a reduction factor calculated to provide
2 benefits actuarially equivalent to an annuity starting at
3 superannuation age shall be applied to the product
4 determined for that service. The class of service
5 multiplier for any period of concurrent service shall be
6 multiplied by the proportion of total State and school
7 compensation during such period attributable to State
8 service. In the event a member has two multipliers for
9 one class of service the class of service multiplier to
10 be used for calculating benefits for that class shall be
11 the average of the two multipliers weighted by the
12 proportion of compensation attributable to each
13 multiplier during the three years of highest annual
14 compensation in that class of service: Provided, That in
15 the case of a member of Class E-1, a portion but not all
16 of whose three years of highest annual judicial
17 compensation is prior to January 1, 1973, two class of
18 service multipliers shall be calculated on the basis of
19 his entire judicial service, the one applying the
20 judicial class of service multipliers effective prior to
21 January 1, 1973 and the second applying the class of
22 service multipliers effective subsequent to January 1,
23 1973. The average class of service multiplier to be used
24 for calculating benefits for his judicial service shall
25 be the average of the two calculated multipliers weighted
26 by the proportion of compensation attributable to each of
27 the calculated multipliers during the three years of
28 highest annual compensation in that class of service.
29 (ii) If the member has ten or more years, but less
30 than 20 years, of credited Class P service, then a single
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1 life annuity equal to the sum of:
2 (A) a standard single life annuity calculated
3 pursuant to subparagraph (i) on all credited service
4 other than Class P service; and
5 (B) an annuity equal to 2% of the highest annual
6 salary, multiplied by the total number of years and
7 fractional part of a year of credited Class P service
8 of the member. In case the member on the effective
9 date of retirement is under the superannuation age
10 applicable to Class P service, a reduction factor
11 calculated to provide benefits actuarially equivalent
12 to an annuity starting at superannuation age shall be
13 applied to the product determined for the Class P
14 service.
15 (iii) If the member has 20 or more years, but less
16 than 25 years, of credited Class P service, then a single
17 life annuity equal to the sum of:
18 (A) a standard single life annuity calculated
19 pursuant to subparagraph (i) on all credited service
20 other than Class P service; and
21 (B) 50% of the highest annual salary, unreduced
22 if the member is under superannuation age.
23 (iv) If the member has 25 or more years of credited
24 Class P service, then a single life annuity equal to the
25 sum of:
26 (A) a standard single life annuity calculated
27 pursuant to subparagraph (i) on all credited service
28 other than Class P service; and
29 (B) 75% of the highest annual salary, unreduced
30 if the member is under superannuation age.
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1 (2) If eligible, a single life annuity of 2% of his
2 average noncovered salary for each year of social security
3 integration credit as provided for in section 5305 (relating
4 to social security integration credits) multiplied, if on the
5 effective date of retirement the member is under
6 superannuation age for any service, by the actuarially
7 determined reduction factor for that service.
8 (3) If eligible, a single life annuity which is
9 actuarially equivalent to the regular and additional
10 accumulated deductions attributable to contributions as a
11 member of Class C, but not less than such annuity determined
12 as if the member were age 60 on the effective date of
13 retirement, actuarially reduced in the event the member is
14 under superannuation age on the effective date of retirement.
15 (4) If eligible, a single life annuity which is
16 actuarially equivalent to the amount by which his regular and
17 additional accumulated deductions attributable to any
18 credited service other than as a member of Class C are
19 greater than one-half of the actuarially equivalent value on
20 the effective date of retirement of the annuity as provided
21 in paragraph (1) attributable to service other than Class C
22 for which regular or joint coverage member contributions were
23 made.
24 (5) If eligible, a single life annuity which is
25 actuarially equivalent to the amount by which his social
26 security integration accumulated deductions are greater than
27 one-half of the actuarially equivalent value on the effective
28 date of retirement of the annuity provided for under
29 paragraph (2).
30 (6) If eligible, a single life annuity sufficient
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1 together with the annuity provided for in paragraph (1) as a
2 Class A member and the highest annuity provided for in
3 paragraph (2) to which he is entitled, or at his option could
4 have been entitled, to produce that percentage of a standard
5 single life annuity on the effective date of retirement as
6 determined by his total years of credited service as a member
7 of Class A and by the following table:
8 Total Years of Percentage of
9 Credited Service Standard
10 as a Member of Single Life
11 Class A Annuity
12 35-40 100%
13 41 102%
14 42 104%
15 43 106%
16 44 108%
17 45 or more 110%
18 * * *
19 Section 5. Section 5706(b) of Title 71 is amended and the
20 section is amended by adding a subsection to read:
21 § 5706. Termination of annuities.
22 * * *
23 (b) Subsequent discontinuance of service.--Upon subsequent
24 discontinuance of service, such member other than a former
25 annuitant who had the effect of his frozen present value
26 eliminated in accordance with subsection (c), or a member who
27 does not earn enough service to have the effect of his frozen
28 present value eliminated in accordance with subsection (c) but
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1 who earns Class P service credit after his return to service, or
2 a former disability annuitant shall be entitled to an annuity
3 which is actuarially equivalent to the sum of the present value
4 as determined under subsection (a) and the present value of a
5 maximum single life annuity based on years of service credited
6 subsequent to reentry in the system and his final average salary
7 computed by reference to his compensation during his entire
8 period of State and school service.
9 (b.1) Subsequent discontinuance of service by members who
10 earned Class P service credit.--Upon subsequent discontinuance
11 of service by a member who does not earn enough service to have
12 the effect of his frozen present value eliminated in accordance
13 with subsection (c) but who earns Class P service credit after
14 his return to service, such a member shall be entitled to an
15 annuity which is actuarially equivalent to the sum of:
16 (1) the present value as determined under subsection
17 (a);
18 (2) the present value of the maximum single life annuity
19 based on years of service other than Class P service credited
20 subsequent to reentry in the system and his final average
21 salary computed by reference to his compensation during his
22 entire period of State and school service; and
23 (3) the present value of one of the following annuities:
24 (i) If the additional Class P service makes the
25 total of Class P service less than ten years, then a
26 maximum single life annuity based on years of Class P
27 service credited subsequent to reentry in the system and
28 his final average salary computed by reference to his
29 compensation during his entire period of State and school
30 service.
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1 (ii) If the additional Class P service makes the
2 total of Class P service more than ten but less than 20
3 years, then a maximum single life annuity based on years
4 of Class P service credited subsequent to reentry in the
5 system and his highest annual salary computed by
6 reference to his compensation during his entire period of
7 prison security officer service.
8 (iii) If the member had less than 20 years of Class
9 P service before returning to State service and the
10 additional Class P service makes the total of Class P
11 service 20 or more years, but less than 25 years, then a
12 single life annuity equal to 2.5% of his highest annual
13 salary computed by reference to his compensation during
14 his entire period of prison security officer service for
15 each year or fractional part of a year of Class P service
16 credited after reentry into State service.
17 (iv) If the member had less than 25 years of Class P
18 service before returning to service and the additional
19 Class P service makes the total of Class P service 25 or
20 more than 25 years, then a single life annuity equal to
21 5% of his highest annual salary computed by reference to
22 his compensation during his entire period of prison
23 security officer service for each year or fractional part
24 of a year of Class P service credited after reentry into
25 State service.
26 If the member had 20 or more years, but less than 25 years, of
27 Class P service before returning to State service and the
28 additional Class P service does not make the total of Class P
29 service more than 25 years, or if the member had 25 or more
30 years of Class P service before returning to State service, then
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1 no annuity shall be paid under paragraph (3).
2 * * *
3 Section 6. Section 5902(k) of Title 71 is amended to read:
4 § 5902. Administrative duties of the board.
5 * * *
6 (k) Certification of employer contributions.--The board
7 shall, each year in addition to the itemized budget required
8 under section 5509 (relating to appropriations and assessments
9 by the Commonwealth), certify, as a percentage of the members'
10 payroll, the employers' contributions as determined pursuant to
11 section 5508 (relating to actuarial cost method) necessary for
12 the funding of prospective annuities for active members and the
13 annuities of annuitants and certify the rates and amounts of the
14 employers' normal contributions as determined pursuant to
15 section 5508(b), accrued liability contributions as determined
16 pursuant to section 5508(c) and (h), supplemental annuities
17 contribution rate as determined pursuant to section 5508(e) and
18 the experience adjustment factor as determined pursuant to
19 section 5508(f), which shall be paid to the fund and credited to
20 the appropriate accounts. These certifications shall be regarded
21 as final and not subject to modification by the Budget
22 Secretary.
23 * * *
24 Section 7. Section 5903 of Title 71 is amended by adding a
25 subsection to read:
26 § 5903. Duties of the board to advise and report to heads of
27 departments and members.
28 * * *
29 (f) Transfer to Class P membership certifications.--The
30 board shall certify to each prison security officer who is
20010H0129B0988 - 15 -
1 transferred from Class A to Class P the amount of Class A
2 service that is so transferred.
3 Section 8. The provisions of this act are severable to the
4 extent that if any of its provisions shall be held to be legally
5 or unconstitutionally impermissible as applied to any State
6 employee with Class P service, the decision of the court shall
7 not affect or impair the application of the provisions of this
8 act to other State employees with Class P service. Those members
9 against whom the provision is legally or unconstitutionally
10 impermissible shall have their pension and retirement benefits
11 calculated under 71 Pa.C.S. Part XXV as if this act had not been
12 enacted.
13 Section 9. This act shall take effect in 90 days.
B7L71JS/20010H0129B0988 - 16 -