PRINTER'S NO. 1470
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.1289
Session of
2025
INTRODUCED BY MALAGARI, DOUGHERTY, VENKAT, WARREN, PIELLI, KHAN,
SANCHEZ, GIRAL, K.HARRIS, BOROWSKI, HILL-EVANS, McNEILL,
PROKOPIAK, SCHLOSSBERG, HANBIDGE, DONAHUE, BOYD, D. WILLIAMS,
SIEGEL, RUSNOCK, O'MARA, NEILSON, STEELE, PROBST, OTTEN,
CEPEDA-FREYTIZ, McANDREW, SCHWEYER, RIVERA, GUENST, DALEY AND
SHUSTERMAN, APRIL 23, 2025
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, APRIL 23, 2025
AN ACT
Amending the act of December 14, 1988 (P.L.1192, No.147),
entitled "An act requiring municipal retirement systems to
pay special ad hoc postretirement adjustments to certain
retired police officers and firefighters; providing for the
financing of these adjustments; providing for the
administration of the Commonwealth's reimbursements for these
adjustments; and making repeals," providing for 2026 special
ad hoc municipal police and firefighter postretirement
adjustment; in financing of special ad hoc adjustment,
providing for reimbursement by Commonwealth for 2026 special
ad hoc adjustment; in administrative provisions, further
providing for municipal retirement system certification of
adjustments paid and of reimbursable amounts and for
municipal receipt of reimbursement payment; and making an
editorial change.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of December 14, 1988 (P.L.1192, No.147),
known as the Special Ad Hoc Municipal Police and Firefighter
Postretirement Adjustment Act, is amended by adding a chapter to
read:
CHAPTER 4-A
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22 2026 SPECIAL AD HOC MUNICIPAL POLICE AND
FIREFIGHTER POSTRETIREMENT ADJUSTMENT
Section 401-A. Entitlement to 2026 special ad hoc
postretirement adjustment.
A municipal retirement system shall pay a retired police
officer or firefighter a special ad hoc postretirement
adjustment under this chapter if all of the following apply:
(1) The retiree has terminated active employment with
the municipality as a police officer or firefighter.
(2) The retiree is receiving a retirement benefit from a
municipal retirement system on the basis of active employment
with the municipality as a police officer or firefighter.
(3) The retiree began receiving the retirement benefit
before January 1, 2016.
Section 402-A. Amount of 2026 special ad hoc postretirement
adjustment.
(a) General rule.--Except as provided in subsections (b) and
(c), a municipal retirement system shall pay a retired police
officer or firefighter a monthly special ad hoc postretirement
adjustment under section 401-A that shall be calculated as
follows:
(1) The sum of $250 a month, if on January 1, 2026, the
retiree has been retired at least 10 years but less than 15
years.
(2) The sum of $375 a month, if on January 1, 2026, the
retiree has been retired at least 15 years but less than 20
years.
(3) The sum of $500 a month, if on January 1, 2026, the
retiree has been retired at least 20 years.
(b) Limitation.--If, under section 401-A, a retiree is
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30 entitled to be paid a special ad hoc postretirement adjustment
by more than one municipal retirement system, the amount of the
special ad hoc postretirement adjustment under subsection (a)
shall be reduced so that the total of all these adjustments paid
to the retiree does not exceed the amount specified in
subsection (a).
(c) Modification in amount of 2026 special ad hoc
postretirement adjustment.--The amount of the special ad hoc
postretirement adjustment calculated under subsection (a) shall
be reduced annually by 65% of the total amount of any
postretirement adjustments provided to the retiree under the
municipal retirement plan after January 1, 2002, and before
December 31, 2025, and paid in the immediately preceding year.
Section 2. Section 502.1(a)(2) of the act is amended to
read:
Section 502.1. Reimbursement by Commonwealth for 2002 special
ad hoc adjustment.
(a) General rule.--
* * *
(2) The determination of the reimbursable amount of the
amortization contribution requirement attributable to the
special ad hoc postretirement adjustment under Chapter 4 in
any year shall be calculated as the amortization contribution
requirement attributable to the special ad hoc postretirement
adjustments under Chapter 4 and reflected in the
determination of the financial requirements of the pension
plan under Chapter 3 of the Municipal Pension Plan Funding
Standard and Recovery Act for the immediate prior year less
the product of that amortization contribution requirement
multiplied by the ratio of the amount of general municipal
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30 pension system State aid allocated to the retirement system
in the immediate prior year to the total amount of municipal
contributions made to the retirement system from all sources
other than employee contributions in the immediate prior
year. Where a municipality has issued bonds or notes to fund
an unfunded actuarial accrued liability under 53 Pa.C.S. Pt.
[V] VII Subpt. B (relating to indebtedness and borrowing) or
under other laws applicable to the municipality, the general
municipal pension system State aid and municipal
contributions used by the municipality to make debt service
payments on the bonds or notes, or both, issued to fund an
unfunded actuarial accrued liability shall be included in the
calculation of the ratio applied to the amortization
contribution requirement.
* * *
Section 3. The act is amended by adding a section to read:
Section 502.2. Reimbursement by Commonwealth for 2026 special
ad hoc adjustment.
(a) General rule.--
(1) Except as provided in subsection (b), beginning in
the year following the year in which the amortization
contribution requirement attributable to a special ad hoc
postretirement adjustment under Chapter 4-A is first
reflected in the financial requirements of the retirement
system determined under Chapter 3 of the act of December 18,
1984 (P.L.1005, No.205), known as the Municipal Pension Plan
Funding Standard and Recovery Act, the Auditor General shall
determine the Commonwealth reimbursement payable to the
municipality representing the amortization contribution
requirement attributable to the special ad hoc postretirement
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30 adjustment under Chapter 4-A that was paid with revenues of
the municipality other than general municipal pension system
State aid provided under the Municipal Pension Plan Funding
Standard and Recovery Act.
(2) The determination of the reimbursable amount of the
amortization contribution requirement attributable to the
special ad hoc postretirement adjustment under Chapter 4-A in
any year shall be calculated as the amortization contribution
requirement attributable to the special ad hoc postretirement
adjustments under Chapter 4-A and reflected in the
determination of the financial requirements of the pension
plan under Chapter 3 of the Municipal Pension Plan Funding
Standard and Recovery Act for the immediate prior year less
the product of that amortization contribution requirement
multiplied by the ratio of the amount of general municipal
pension system State aid allocated to the retirement system
in the immediate prior year to the total amount of municipal
contributions made to the retirement system from all sources
other than employee contributions in the immediate prior
year. Where a municipality has issued bonds or notes to fund
an unfunded actuarial accrued liability under 53 Pa.C.S. Pt.
VII Subpt. B (relating to indebtedness and borrowing) or
under other laws applicable to the municipality, the general
municipal pension system State aid and municipal
contributions used by the municipality to make debt service
payments on the bonds or notes, or both, issued to fund an
unfunded actuarial accrued liability shall be included in the
calculation of the ratio applied to the amortization
contribution requirement.
(3) The Commonwealth shall reimburse a municipality,
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30 from the General Fund, for the reimbursable amount determined
for each year under this paragraph.
(b) Limitation of eligibility.--
(1) The Commonwealth shall not reimburse any
municipality for a special ad hoc adjustment paid under
Chapter 4-A if the information required under section 901(a)
(2) either was not certified to the Auditor General or was
certified after April 1 of the year the certification was
due.
(2) The Commonwealth shall not reimburse a municipality
for the reimbursable amount of the amortization contribution
requirement attributable to the special ad hoc postretirement
adjustment under Chapter 4-A if the municipality fails to
submit a complete certification of the reimbursable amount of
the amortization contribution requirement determined under
subsection (a) to the Auditor General before April 1 of the
year in which the reimbursement is payable.
(c) Variable definition of amortization contribution
requirement.--For purposes of this section, the term
"amortization contribution requirement" shall have the meaning
specified in this subsection as follows:
(1) In a municipal pension plan with defined benefits
for which the municipality determines the financial
requirements of the pension plan under section 302 of the
Municipal Pension Plan Funding Standard and Recovery Act, the
term "amortization contribution requirement" shall mean the
amortization contribution requirement attributable to the
special ad hoc postretirement adjustments under Chapter 4-A
that was reflected in the financial requirements of the
pension plan determined for the immediate prior year.
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30 (2) In a municipal pension plan without defined benefits
for which the municipality determines the financial
requirements of the pension plan under section 303 of the
Municipal Pension Plan Funding Standard and Recovery Act, the
term "amortization contribution requirement" shall mean the
sum of the payments made to the retirement system in the
immediate prior year in order to provide the special ad hoc
postretirement adjustments under Chapter 4-A in that year.
Section 4. Section 901(a) of the act is amended by adding a
paragraph to read:
Section 901. Municipal retirement system certification of
adjustments paid and of reimbursable amounts.
(a) Certification.--
* * *
(3) Beginning in the year 2026, a municipality with a
retirement system that pays a special ad hoc postretirement
adjustment under Chapter 4-A in a year shall certify its
reimbursable amount under section 502.2(a) to the Auditor
General not later than April 1 of the following year.
* * *
Section 5. Section 903 of the act is amended by adding a
subsection to read:
Section 903. Municipal receipt of reimbursement payment.
* * *
(c) 2026 postretirement adjustment reimbursement.--Upon
receipt of the reimbursement payment from the Commonwealth for
the postretirement adjustments under Chapter 4-A, the treasurer
of the municipality shall deposit the reimbursement payment into
the municipality's general fund.
Section 6. The following shall apply:
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30 (1) The special ad hoc postretirement adjustment under
section 401-A of the act shall be effective on the date of
the first retirement benefit made after January 1, 2026.
(2) If the special ad hoc postretirement adjustment
under section 401-A of the act is not included in the initial
retirement benefit payment occurring after January 1, 2026,
the special ad hoc postretirement adjustment shall be
included as soon as practicable in the retirement benefit
payment of the retiree, and the initial retirement benefit
payment that includes the special ad hoc postretirement
adjustment shall also include the total amount of the special
ad hoc postretirement adjustments previously omitted from the
retirement benefit payments made after January 1, 2026.
Section 7. This act shall take effect immediately.
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