PRINTER'S NO. 1343
No. 123 Session of 2001
INTRODUCED BY TANGRETTI, ROSS, COY, DALLY, ARGALL, BELARDI,
BELFANTI, CIVERA, M. COHEN, COLAFELLA, CORRIGAN, CURRY,
DAILEY, DALEY, DeWEESE, FRANKEL, GEORGE, GORDNER, GRUCELA,
HENNESSEY, LAUGHLIN, MACKERETH, MAJOR, MAYERNIK, McCALL,
McNAUGHTON, MELIO, R. MILLER, MUNDY, NAILOR, ORIE, PETRARCA,
PIPPY, PISTELLA, READSHAW, RUBLEY, SANTONI, SCHRODER,
SOLOBAY, STURLA, SURRA, E. Z. TAYLOR, THOMAS, TIGUE, TRELLO,
WASHINGTON, WILT AND YUDICHAK, MARCH 26, 2001
REFERRED TO COMMITTEE ON RULES, MARCH 26, 2001
A CONCURRENT RESOLUTION
1 Establishing and directing a select committee to consider issues
2 related to a uniform municipal pension system and portability
3 among municipal police pensions.
4 WHEREAS, The task force formed pursuant to House Resolution
5 167 of 1997 to study municipal police needs and services
6 considered the possible creation of a uniform municipal police
7 pension system or an alternative option of providing portability
8 among existing police pension laws; and
9 WHEREAS, The Commonwealth has approximately 973 municipal
10 pension plans, 918 with defined benefits and 55 without defined
11 benefits, with membership ranging from 6,597 active members to 1
12 active member and with more than half, 528, of the pension plans
13 having fewer than 5 active members; and
14 WHEREAS, The following arguments have been made in support of
15 a unified municipal pension system:
1 (1) by replacing multiple administrative units with one
2 administrative unit, the Commonwealth will be administering
3 municipal pension benefits the same way most other states do
4 and will experience the associated operational efficiencies;
5 (2) a Statewide retirement system for local employees
6 could provide a uniform structure of benefits with optional
7 membership classifications that accommodate the varying needs
8 of local governments; and
9 (3) making an extended transition to one administrative
10 agency would, among other things, minimize the impact on
11 private sector service providers, eliminate duplication of
12 administrative functions and reduce the annual administrative
13 costs and improve administrative functions by ensuring a
14 consistent level of performance through the use of full-time
15 professional staff;
16 and
17 WHEREAS, Potential disadvantages to a single pension system
18 include:
19 (1) loss of municipal control of their pension systems;
20 (2) the implementation of a Statewide retirement system
21 might be viewed with suspicion; and
22 (3) the Statewide local government retirement system
23 potentially could complicate the provision of employee
24 retirement benefits during the transitional period and might
25 ultimately cost more than current local retirement systems;
26 and
27 WHEREAS, Providing for pension portability among municipal
28 police pension systems is an alternative option to the
29 establishment of a unified municipal pension system; and
30 WHEREAS, The potential advantages of pension portability
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1 include:
2 (1) more nearly establishing a free market for labor;
3 (2) improved access to experienced personnel;
4 (3) reduced recruiting and training costs for
5 municipalities hiring police; and
6 (4) increased opportunity for career advancement of
7 police officers;
8 and
9 WHEREAS, Potential disadvantages to pension portability
10 include:
11 (1) reduced ability of municipalities to retain
12 personnel;
13 (2) concomitant loss of trained and experienced police
14 officers;
15 (3) increased recruiting and training costs for
16 municipalities losing employees and shifting training costs
17 in the aggregate from larger municipalities to smaller ones;
18 and
19 (4) elimination of actuarial gains which are currently
20 achieved through employee terminations prior to vesting
21 availability;
22 and
23 WHEREAS, Portability might be achieved for municipal police
24 officers through the establishment of one cost-sharing, multi-
25 employer, defined benefit retirement plan, much like the State
26 Employees Retirement System, which provides for portability
27 among 107 State-related employers, and the Public School
28 Employees Retirement System, which provides for portability
29 among 640 public school employers, where employee movement would
30 be within one retirement system with standard actuarial
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1 methodology and benefits; and
2 WHEREAS, The alternative approaches to portability that exist
3 within the current myriad of local government systems and
4 benefit designs might be more complex administratively and have
5 more potential for employer and employee inequity:
6 municipalities would need to know the calculations before the
7 pension system decision is finalized, and costs would be
8 incurred even when no portability is exercised; therefore be it
9 RESOLVED (the Senate concurring), That due to the complexity
10 of the issues concerning municipal police pension systems, the
11 General Assembly form a select committee to consider issues
12 relating to municipal police pensions, including provisions
13 concerning portability among the various police retirement
14 systems, and to consider alternatively the creation of a uniform
15 pension system for police officers and that due consideration be
16 given to the financial burden any change in police pensions
17 would have on municipalities; and be it further
18 RESOLVED, That the select committee be comprised of six
19 members, one member to be appointed by each of the following:
20 the President pro tempore of the Senate, the Majority Leader of
21 the Senate and the Minority Leader of the Senate, the Speaker of
22 the House of Representatives, the Majority Leader of the House
23 of Representatives and the Minority Leader of the House of
24 Representatives; and be it further
25 RESOLVED, That these appointments be made within 30 days of
26 adoption of this resolution; and be it further
27 RESOLVED, That the select committee hold hearings, take
28 testimony and make its investigations at such places as it deems
29 necessary in this Commonwealth; and be it further
30 RESOLVED, That each member of the select committee have power
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1 to administer oaths and affirmations to witnesses appearing
2 before the select committee; and be it further
3 RESOLVED, That the Pennsylvania Employee Retirement
4 Commission provide assistance to the select committee by
5 providing staff and expertise to the committee; and be it
6 further
7 RESOLVED, That the select committee prepare a report with
8 findings and recommendations to the Local Government Committee
9 of the Senate and the Local Government Committee of the House of
10 Representatives to be submitted within one year of the adoption
11 of this resolution.
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