Senate Bill 755 addresses municipal pension reform
Introduced by Sen. John H. Eichelberger Jr., S.B. 755 has been praised as a viable solution to the growing Pennsylvania pension crisis. The bill would update Defined Contribution (DC) pension plans. It follows the May 11 Senate passage of S.B. 1, which implements a DC plan for enrollees in the Pennsylvania State Employees' Retirement System (SERS) and Public School Employees' Retirement System (PSERS).
“The introduction of this bill is about addressing the very real and growing pension crisis at the municipal level," Eichelberger said. "While the General Assembly is working to address the same crisis with state pensions, I believe we can and must include municipal pension reform in this process."
Under the bill, current and retired employees retain all their existing benefits, while future hires are shifted to the more affordable DC plan. S.B. 755 provides for the removal of all pensions from the binding arbitration process in order to facilitate cost predictions for municipal employers. It also eliminates the practice of salary “spiking,” as well as laying out groundwork for employee contributions and vesting options, and improving overall job and pension security.
The Coalition for Sustainable Communities, a growing alliance of more than 40 commercial, professional and development associations, was formed in 2011 to help the commonwealth’s urban, suburban and rural communities address growing economic and budgetary challenges.