PRINTER'S NO. 1902
No. 1432 Session of 2000
INTRODUCED BY CORMAN, RHOADES, MOWERY, GREENLEAF, HART, WAGNER,
LEMMOND, O'PAKE, PUNT, CONTI, KUKOVICH, STOUT, WHITE AND
WOZNIAK, APRIL 20, 2000
REFERRED TO FINANCE, APRIL 20, 2000
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 * * *
15 "Class of service multiplier."
16 Class of Service Multiplier
17 A 1
18 B .625
1 C 1
2 D 1.25
3 D-1 prior to
4 January 1, 1973 1.875
5 D-1 on and
6 subsequent to
7 January 1, 1973 1.731
8 D-2 prior to
9 January 1, 1973 2.5
10 D-2 on and
11 subsequent to
12 January 1, 1973 1.731
13 D-3 prior to
14 January 1, 1973 3.75
15 D-3 on and
16 subsequent to
17 January 1, 1973 1.731 except prior to December
18 1, 1974 as applied to any
19 additional legislative
20 compensation as an officer
21 of the General Assembly
22 3.75
23 E, E-1 prior to
24 January 1, 1973 2 for each of the first ten
25 years of judicial service,
26 and
27 1.5 for each subsequent year
28 of judicial service
29 E, E-1 on and
30 subsequent to
20000S1432B1902 - 2 -
1 January 1, 1973 1.50 for each of the first
2 ten years of judicial
3 service and
4 1.125 for each subsequent year
5 of judicial service
6 E-2 prior to
7 September 1, 1973 1.5
8 E-2 on and
9 subsequent to
10 September 1, 1973 1.125
11 G 0.417
12 H 0.500
13 I 0.625
14 J 0.714
15 K 0.834
16 L 1.000
17 M 1.100
18 N 1.250
19 P 1
20 T-C (Public School 1
21 Employees'
22 Retirement Code)
23 * * *
24 "Highest annual salary." The highest compensation received
25 for service as a prison security officer during any calendar
26 year during which the member was employed as a prison security
27 officer for the entire calendar year. In the case of a member
28 who first became a member on or after January 1, 1996, the
29 highest annual salary shall be determined as hereinabove
30 provided but subject to the application of the provisions of
20000S1432B1902 - 3 -
1 section 5506.1(a) (relating to annual compensation limit under
2 IRC § 401(a)(17)).
3 * * *
4 "Prison security officer." A full coverage member who is a
5 correction officer who has not been an officer of the
6 Pennsylvania State Police on or after July 1, 1989, and is
7 classified under the Commonwealth's employee classification plan
8 as either a corrections officer trainee, corrections officer 1,
9 corrections officer 2, corrections officer 3, corrections
10 officer 4, or such predecessor or successor classifications as
11 determined by the board to be functionally the same as the
12 classifications listed here.
13 * * *
14 Section 2. Sections 5303(b)(1), 5304(a), 5306(a) and (b) and
15 5308(c) of Title 71 are amended to read:
16 § 5303. Retention and reinstatement of service credits.
17 * * *
18 (b) Eligibility points for prospective credited service.--
19 (1) Every active member of the system or a multiple
20 service member who is a school employee and a member of the
21 Public School Employees' Retirement System on or after the
22 effective date of this part shall receive eligibility points
23 in accordance with section 5307 for current State service,
24 previous State service, or creditable nonstate service upon
25 compliance with sections 5501 (relating to regular member
26 contributions for current service), 5504 (relating to member
27 contributions for the purchase of credit for previous State
28 service or to become a full coverage member), 5505 (relating
29 to contributions for the purchase of credit for creditable
30 nonstate service), 5505.1 (relating to additional member
20000S1432B1902 - 4 -
1 contributions) or 5506 (relating to incomplete payments). The
2 class or classes of service in which the member may be
3 credited for previous State service prior to the effective
4 date of this part shall be the class or classes in which he
5 was or could have at any time elected to be credited for such
6 service, provided that eligibility for Class P credit shall
7 be limited in accordance with section 5306 (relating to
8 classes of service). The class of service in which a member
9 shall be credited for service subsequent to the effective
10 date of this part shall be determined in accordance with
11 section 5306 [(relating to classes of service)].
12 * * *
13 § 5304. Creditable nonstate service.
14 (a) Eligibility.--An active member or a multiple service
15 member who is a school employee and an active member of the
16 Public School Employees' Retirement System shall be eligible for
17 Class A service credit for creditable nonstate service as set
18 forth in subsections (b) and (c) except that intervening
19 military service shall be credited in the class of service for
20 which the member was eligible at the time of entering into
21 military service and for which he makes the required
22 contributions[.] and except that military service credited
23 pursuant to subsection (c)(2) to a member who is a prison
24 security officer at the time the military service is credited
25 shall be Class P service.
26 * * *
27 § 5306. Classes of service.
28 (a) Class A membership.--A State employee, other than a
29 prison security officer, who is a member of Class A on the
30 effective date of this part or who becomes a member of the
20000S1432B1902 - 5 -
1 system subsequent to the effective date of this part shall be
2 classified as a Class A member and receive credit for Class A
3 service upon payment of regular and additional member
4 contributions for Class A service.
5 (b) Other class membership.--
6 (1) A State employee who is a member of a class of
7 service other than Class A on the effective date of this part
8 shall retain his membership in that class until such service
9 is discontinued; any service other than service as a prison
10 security officer thereafter shall be credited as Class A
11 service.
12 (2) (i) A prison security officer shall be classified
13 as a Class P member and any service performed as a prison
14 security officer on or after the effective date of this
15 paragraph shall be credited as Class P service.
16 (ii) An active member or inactive member on leave
17 without pay who is a prison security officer on the
18 effective date of this paragraph, shall have all service
19 as a prison security officer prior to the effective date
20 of this paragraph credited as Class P service.
21 (iii) An active member or inactive member on leave
22 without pay who is a prison security officer on the
23 effective date of this paragraph and who prior to the
24 effective date of this paragraph had military service
25 credited as creditable nonstate service pursuant to
26 section 5304 (relating to creditable nonstate service) or
27 credited as State service pursuant to the laws of this
28 Commonwealth or the United States, shall have all such
29 military service credited as Class P service instead of
30 the class in which it was previously credited.
20000S1432B1902 - 6 -
1 (iv) In the event a member has Class P service and
2 service other than Class P service credited in the same
3 calendar year and the aggregate amount of each class of
4 service calculated without regard to any other class of
5 service totals more than one year, then each class of
6 service shall be credited proportionally, not to exceed
7 one year in total service.
8 * * *
9 § 5308. Eligibility for annuities.
10 * * *
11 (c) Disability annuity.--An active member or inactive member
12 on leave without pay who has credit for at least five years of
13 service or any active member or inactive member on leave without
14 pay who is an officer of the Pennsylvania State Police, a prison
15 security officer or an enforcement officer shall, upon
16 compliance with section 5907(k), be entitled to a disability
17 annuity if he becomes mentally or physically incapable of
18 continuing to perform the duties for which he is employed and
19 qualifies in accordance with the provisions of section
20 5905(c)(1) (relating to duties of the board regarding
21 applications and elections of members).
22 Section 3. Section 5508 of Title 71 is amended by adding a
23 subsection to read:
24 § 5508. Actuarial cost method.
25 * * *
26 (h) Determination of liability for Class P service.--
27 Notwithstanding any other provision of this part or other law,
28 the total additional accrued actuarial liability resulting from
29 Class P service shall be determined by the actuary as part of
30 the first annual valuation made after the effective date of this
20000S1432B1902 - 7 -
1 subsection. The resulting additional accrued actuarial liability
2 shall be paid by the Department of Corrections in annual
3 payments over a period of 20 years from the first day of July,
4 coincident with or next following the first valuation made after
5 the effective date of this subsection. The amount of each annual
6 accrued liability contribution for Class P service shall be 5%
7 greater than the amount of such contribution for the previous
8 fiscal year.
9 Section 4. Section 5702(a) of Title 71 is amended to read:
10 § 5702. Maximum single life annuity.
11 (a) General rule.--Any full coverage member who is eligible
12 to receive an annuity pursuant to the provisions of section
13 5308(a) or (b) (relating to eligibility for annuities) shall be
14 entitled to receive a maximum single life annuity attributable
15 to his credited service and equal to the sum of the following
16 single life annuities beginning at the effective date of
17 retirement:
18 (1) [A] One of the following single life annuities:
19 (i) If a member has less than ten years of credited
20 Class P service, then a standard single life annuity
21 multiplied by the sum of the products, determined
22 separately for each class of service, obtained by
23 multiplying the appropriate class of service multiplier
24 by the ratio of years of service credited in that class
25 to the total credited service. In case the member on the
26 effective date of retirement is under superannuation age
27 for any service, a reduction factor calculated to provide
28 benefits actuarially equivalent to an annuity starting at
29 superannuation age shall be applied to the product
30 determined for that service. The class of service
20000S1432B1902 - 8 -
1 multiplier for any period of concurrent service shall be
2 multiplied by the proportion of total State and school
3 compensation during such period attributable to State
4 service. In the event a member has two multipliers for
5 one class of service the class of service multiplier to
6 be used for calculating benefits for that class shall be
7 the average of the two multipliers weighted by the
8 proportion of compensation attributable to each
9 multiplier during the three years of highest annual
10 compensation in that class of service: Provided, That in
11 the case of a member of Class E-1, a portion but not all
12 of whose three years of highest annual judicial
13 compensation is prior to January 1, 1973, two class of
14 service multipliers shall be calculated on the basis of
15 his entire judicial service, the one applying the
16 judicial class of service multipliers effective prior to
17 January 1, 1973 and the second applying the class of
18 service multipliers effective subsequent to January 1,
19 1973. The average class of service multiplier to be used
20 for calculating benefits for his judicial service shall
21 be the average of the two calculated multipliers weighted
22 by the proportion of compensation attributable to each of
23 the calculated multipliers during the three years of
24 highest annual compensation in that class of service.
25 (ii) If the member has ten or more years, but less
26 than 20 years, of credited Class P service, then a single
27 life annuity equal to the sum of:
28 (A) a standard single life annuity calculated
29 pursuant to subparagraph (i) on all credited service
30 other than Class P service; and
20000S1432B1902 - 9 -
1 (B) an annuity equal to 2% of the highest annual
2 salary, multiplied by the total number of years and
3 fractional part of a year of credited Class P service
4 of the member. In case the member on the effective
5 date of retirement is under the superannuation age
6 applicable to Class P service, a reduction factor
7 calculated to provide benefits actuarially equivalent
8 to an annuity starting at superannuation age shall be
9 applied to the product determined for the Class P
10 service.
11 (iii) If the member has 20 or more years, but less
12 than 25 years, of credited Class P service, then a single
13 life annuity equal to the sum of:
14 (A) a standard single life annuity calculated
15 pursuant to subparagraph (i) on all credited service
16 other than Class P service; and
17 (B) 50% of the highest annual salary, unreduced
18 if the member is under superannuation age.
19 (iv) If the member has 25 or more years of credited
20 Class P service, then a single life annuity equal to the
21 sum of:
22 (A) a standard single life annuity calculated
23 pursuant to subparagraph (i) on all credited service
24 other than Class P service; and
25 (B) 75% of the highest annual salary, unreduced
26 if the member is under superannuation age.
27 (2) If eligible, a single life annuity of 2% of his
28 average noncovered salary for each year of social security
29 integration credit as provided for in section 5305 (relating
30 to social security integration credits) multiplied, if on the
20000S1432B1902 - 10 -
1 effective date of retirement the member is under
2 superannuation age for any service, by the actuarially
3 determined reduction factor for that service.
4 (3) If eligible, a single life annuity which is
5 actuarially equivalent to the regular and additional
6 accumulated deductions attributable to contributions as a
7 member of Class C, but not less than such annuity determined
8 as if the member were age 60 on the effective date of
9 retirement, actuarially reduced in the event the member is
10 under superannuation age on the effective date of retirement.
11 (4) If eligible, a single life annuity which is
12 actuarially equivalent to the amount by which his regular and
13 additional accumulated deductions attributable to any
14 credited service other than as a member of Class C are
15 greater than one-half of the actuarially equivalent value on
16 the effective date of retirement of the annuity as provided
17 in paragraph (1) attributable to service other than Class C
18 for which regular or joint coverage member contributions were
19 made.
20 (5) If eligible, a single life annuity which is
21 actuarially equivalent to the amount by which his social
22 security integration accumulated deductions are greater than
23 one-half of the actuarially equivalent value on the effective
24 date of retirement of the annuity provided for under
25 paragraph (2).
26 (6) If eligible, a single life annuity sufficient
27 together with the annuity provided for in paragraph (1) as a
28 Class A member and the highest annuity provided for in
29 paragraph (2) to which he is entitled, or at his option could
30 have been entitled, to produce that percentage of a standard
20000S1432B1902 - 11 -
1 single life annuity on the effective date of retirement as
2 determined by his total years of credited service as a member
3 of Class A and by the following table:
4 Total Years of Percentage of
5 Credited Service Standard
6 as a Member of Single Life
7 Class A Annuity
8 35-40 100%
9 41 102%
10 42 104%
11 43 106%
12 44 108%
13 45 or more 110%
14 * * *
15 Section 5. Section 5706(b) of Title 71 is amended and the
16 section is amended by adding a subsection to read:
17 § 5706. Termination of annuities.
18 * * *
19 (b) Subsequent discontinuance of service.--Upon subsequent
20 discontinuance of service, such member other than a former
21 annuitant who had the effect of his frozen present value
22 eliminated in accordance with subsection (c), or a member who
23 does not earn enough service to have the effect of his frozen
24 present value eliminated in accordance with subsection (c) but
25 who earns Class P service credit after his return to service, or
26 a former disability annuitant shall be entitled to an annuity
27 which is actuarially equivalent to the sum of the present value
28 as determined under subsection (a) and the present value of a
20000S1432B1902 - 12 -
1 maximum single life annuity based on years of service credited
2 subsequent to reentry in the system and his final average salary
3 computed by reference to his compensation during his entire
4 period of State and school service.
5 (b.1) Subsequent discontinuance of service by members who
6 earned Class P service credit.--Upon subsequent discontinuance
7 of service by a member who does not earn enough service to have
8 the effect of his frozen present value eliminated in accordance
9 with subsection (c) but who earns Class P service credit after
10 his return to service, such a member shall be entitled to an
11 annuity which is actuarially equivalent to the sum of:
12 (1) the present value as determined under subsection
13 (a);
14 (2) the present value of the maximum single life annuity
15 based on years of service other than Class P service credited
16 subsequent to reentry in the system and his final average
17 salary computed by reference to his compensation during his
18 entire period of State and school service; and
19 (3) the present value of one of the following annuities:
20 (i) If the additional Class P service makes the
21 total of Class P service less than ten years, then a
22 maximum single life annuity based on years of Class P
23 service credited subsequent to reentry in the system and
24 his final average salary computed by reference to his
25 compensation during his entire period of State and school
26 service.
27 (ii) If the additional Class P service makes the
28 total of Class P service more than ten but less than 20
29 years, then a maximum single life annuity based on years
30 of Class P service credited subsequent to reentry in the
20000S1432B1902 - 13 -
1 system and his highest annual salary computed by
2 reference to his compensation during his entire period of
3 prison security officer service.
4 (iii) If the member had less than 20 years of Class
5 P service before returning to State service and the
6 additional Class P service makes the total of Class P
7 service 20 or more years, but less than 25 years, then a
8 single life annuity equal to 2 1/2% of his highest annual
9 salary computed by reference to his compensation during
10 his entire period of prison security officer service for
11 each year or fractional part of a year of Class P service
12 credited after reentry into State service.
13 (iv) If the member had less than 25 years of Class P
14 service before returning to service and the additional
15 Class P service makes the total of Class P service 25 or
16 more than 25 years, then a single life annuity equal to
17 5% of his highest annual salary computed by reference to
18 his compensation during his entire period of prison
19 security officer service for each year or fractional part
20 of a year of Class P service credited after reentry into
21 State service.
22 If the member had 20 or more years, but less than 25 years, of
23 Class P service before returning to State service and the
24 additional Class P service does not make the total of Class P
25 service more than 25 years, or if the member had 25 or more
26 years of Class P service before returning to State service, then
27 no annuity shall be paid under paragraph (3).
28 * * *
29 Section 6. Section 5902(k) of Title 71 is amended to read:
30 § 5902. Administrative duties of the board.
20000S1432B1902 - 14 -
1 * * *
2 (k) Certification of employer contributions.--The board
3 shall, each year in addition to the itemized budget required
4 under section 5509 (relating to appropriations and assessments
5 by the Commonwealth), certify, as a percentage of the members'
6 payroll, the employers' contributions as determined pursuant to
7 section 5508 (relating to actuarial cost method) necessary for
8 the funding of prospective annuities for active members and the
9 annuities of annuitants and certify the rates and amounts of the
10 employers' normal contributions as determined pursuant to
11 section 5508(b), accrued liability contributions as determined
12 pursuant to section 5508(c) and (h), supplemental annuities
13 contribution rate as determined pursuant to section 5508(e) and
14 the experience adjustment factor as determined pursuant to
15 section 5508(f), which shall be paid to the fund and credited to
16 the appropriate accounts. These certifications shall be regarded
17 as final and not subject to modification by the Budget
18 Secretary.
19 * * *
20 Section 7. Section 5903 of Title 71 is amended by adding a
21 subsection to read:
22 § 5903. Duties of the board to advise and report to heads of
23 departments and members.
24 * * *
25 (f) Transfer to Class P membership certifications.--The
26 board shall certify to each prison security officer who is
27 transferred from Class A to Class P the amount of Class A
28 service that is so transferred.
29 Section 8. The provisions of this act are severable to the
30 extent that if any of its provisions shall be held to be legally
20000S1432B1902 - 15 -
1 or unconstitutionally impermissible as applied to any State
2 employee with Class P service, the decision of the court shall
3 not affect or impair the application of the provisions of this
4 act to other State employees with Class P service. Those members
5 against whom the provision is legally or unconstitutionally
6 impermissible shall have their pension and retirement benefits
7 calculated under 71 Pa.C.S. Part XXV as if this act had not been
8 enacted.
9 Section 9. This act shall take effect in 90 days.
C27L71SFL/20000S1432B1902 - 16 -