Posted: | April 7, 2015 10:10 AM |
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From: | Representative Aaron D. Kaufer |
To: | All House members |
Subject: | Alternate Amortization Schedule for Municipal Pensions |
In the near future, I will be introducing legislation to authorize a municipality (except for Philadelphia) to adopt an alternate amortization schedule for its 2015 plan year for the entire outstanding balance of its unfunded actuarial accrued liability of its pension system. This will enable a municipality that has a large unfunded actuarial accrued liability to make more manageable payments without the need for increasing taxes or to minimize the need for increasing taxes. The alternate amortization period will be 30 years. The alternate amortization schedule must be formally adopted by the governing body of the municipality prior to the expiration of the plan year ending in 2015. My legislation will require a municipality that adopts the alternate amortization schedule to notify the Public Employee Retirement Commission of the adoption. The municipality’s annual actuarial valuation reports filed with the commission during the tenure of the alternate amortization schedule must disclose the initial amount of the unfunded actuarial accrued liability, the date that the alternate schedule was established, the amortization target date, the original amortization period, the remaining balance of the unfunded actuarial accrued liability and the amortization payment for the year following the valuation date of the report. Please join me in cosponsoring this legislation. |