Greiner and Grove Introduce Municipal Pension Reform Bill
3/19/2015
HARRISBURG – As local elected officials across the Commonwealth continue to join with Auditor General Eugene DePasquale in calling on Harrisburg to enact reforms that would put Pennsylvania’s distressed municipal pension systems on a sustainable path forward, Reps. Keith J. Greiner (R-Lancaster) and Seth Grove (R-York) today introduced a bill that would do just that.
 
“Municipal pension distress is crippling communities across the Commonwealth, and the problem is only getting worse,” Greiner said. “It’s time for members of the General Assembly to answer the calls of local elected leaders. This legislation would provide distressed communities with the tools necessary to control their pension costs.”
 
House Bill 316 would apply to all townships and boroughs with full-time public safety personnel and all cities, except Philadelphia. After a defined date, new hires would be placed in a defined benefit plan with a balance made up of mandatory employer and employee contributions and an employer-guaranteed interest credit.
 
Current employees would maintain all existing rights and benefits; however, these benefits would be frozen at current levels. Each municipality would maintain two plans until there are no more beneficiaries in the old defined benefit plan. In addition, the legislation would have removed pension benefits from the collective bargaining process.
 
The bill is similar to legislation that Grove introduced last session.
 
“Municipal leaders from across Pennsylvania supported this legislation last session, but unfortunately it didn’t come up for a vote,” Grove said. “Since that time, unfunded municipal pension liabilities grew by $1 billion and will continue to grow until Harrisburg takes action. Republicans and Democrats in the House and Senate must come together and address this crisis.”
 
HB 316 is supported by the Coalition for Sustainable Communities, a nearly 40 member statewide and bipartisan coalition including business chambers, municipal associations, professional associations and community development organizations, as well as the Pennsylvania Municipal League, which represents participating Pennsylvania cities, townships, towns, boroughs and home rule municipalities.
 
“Without fail, uniformed union pension costs, often inclusive of lucrative salary spiking and costly Act 111 binding arbitration awards, represent the single largest expenditure for municipalities,” Richard J. Schuettler, Executive Director of the Pennsylvania Municipal League, said. “Our members fully support Reps. Greiner and Grove in introducing HB 316, which is currently the only legislation that gives municipal governments the tools needed to prevent widespread pension collapse and reverse the current deterioration.”
 
In January, DePasquale released a report detailing a total unfunded liability of more than $7.7 billion for municipal pension systems across the state. According to the report, 562 municipalities out of 1,223 that administer pension plans are distressed and underfunded. The state’s total unfunded municipal pension liability increased by $1 billion in just two years, the report showed.
 
Representative Keith J. Greiner, CPA
43rd Legislative District
Pennsylvania House of Representatives
Media Contact: Jonathan Anzur
717-260-6610
janzur@pahousegop.com
RepGreiner.com / Facebook.com/RepGreiner
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