Bill to Revise PA Public Sector Pensions Heads to Governor

A measure that will revise public sector pensions in Pennsylvania is headed to the desk of Gov. Tom Wolf (D). The state House of Representatives on June 14 passed the bill, which recently was revived in in that chamber, which had rejected it in December 2015.

The House passed SB 1071 in a 136-59 vote; the Senate had passed it on Dec. 4, 2015 in a 30-20 vote.

The measure will:

• modify future benefits of current members of the Public School Employees’ Retirement System (PSERS) and the State Employees’ Retirement System (SERS);

• create Public Pension and Asset Review Commissions for both PSERS and SERS;

• establish a new side-by-side hybrid pension plan for SERS and PSERS, effective for most state employees hired on or after Jan. 1, 2018 and for all school employees hired on or after July 1, 2017;

• establish a defined contribution retirement plan and add a new defined benefit tier to the existing DB plan structure; and

• modify the actuarial funding method utilized by SERS to determine the normal cost rate (a variation of the Entry-Age actuarial cost method).
  

According to the Reading Eagle, Wolfe has said that he will sign the measure into law.