Grove Pension Reform Legislation Faces First Test
HARRISBURG – Taking on the task of reforming pensions head on, Rep. Seth Grove (R-Dover) authored legislation to address currently insurmountable municipal pension debts. House Bill 1581 introduces a cash balance reform plan for our state’s municipal pensions and the bill will be discussed in a meeting of the House Local Government Committee on Wednesday Jan. 15, at 9:15 a.m.

“Currently our municipal pensions have an unfunded liability statewide of more than $2 billion,” Grove said. “This is putting a huge financial strain on local government services, specifically in our urban cores. I have written this legislation to reduce the financial burden on local governments, ensure public safety employees have increased job opportunities and market based pensions, and ensure the financial sustainability of our urban cores.”

The reform plan would apply to all townships and boroughs with full-time public safety personnel and all cities, except Philadelphia. Cash balance is a defined benefit plan of member’s accounts where the balance is made up of mandatory employer and employee contributions and an employer guaranteed interest credit.

The plan would apply to only new hires after an established date. Current employees would maintain all existing rights and benefits; however, these benefits will be frozen at current levels. Each municipality will maintain two plans until there are no more beneficiaries in the old defined benefit plan.

As state legislators prepare for this year’s budget discussions, the growing pension crisis continues to weigh on Pennsylvania’s bottom line. House Bill 1581 is one step toward solving our state’s pension dilemma.

Video of the Local Government Committee meeting on House Bill 1581 will be streamed live, where you can also follow Grove’s legislative goals.

Representative Seth Grove
196th District
Pennsylvania House of Representatives

Media Contact: Mike Straub
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