Pennsylvania Code
Title 16 - COMMUNITY AFFAIRS
Part IV - Public Employee Retirement Commission
Chapter 205 - RECOVERY PROGRAM FOR MUNICIPAL PENSION SYSTEMS
Section 205.2 - Delayed implementation of funding standard

(a) Delayed implementation of funding standard over 10 years. A municipality implementing section 607(g) of the act (53 P. S. § 895.607(g)), authorizing delayed implementation of the funding standard over 10 years, is required to appropriate in the budget of the municipality prepared in 1985 and to contribute to each municipal pension plan in 1986, an amount equal to not less than the municipal contribution to the municipal pension plan made in 1985 and 10% of the difference between that amount and the full minimum municipal obligation with respect to the pension plan under section 302 or 303 of the act (53 P. S. §§ 895.302 or 895.303), whichever is applicable. For a subsequent year during the delayed implementation period, the municipality shall appropriate and make a municipal contribution to each municipal pension plan of an amount equal to not less than the municipal contribution to the municipal pension plan made in the immediately preceding year and the following percentage of the difference between that amount and the full minimum municipal obligation with respect to the pension plan under section 302 or 303 of the act, whichever is applicable:

(b) Delayed implementation of funding standard over 15 years. A municipality implementing section 607(h) of the act, authorizing delayed implementation of the funding standard over 15 years, is required to appropriate in the budget of the municipality prepared in 1985 and to contribute to each municipal pension plan in 1986, an amount equal to not less than the municipal contribution to the municipal pension plan made in 1985 and 6.7% of the difference between that amount and the full minimum municipal obligation with respect to the pension plan under section 302 or 303 of the act, whichever is applicable. For a subsequent year during the delayed implementation period, the municipality shall appropriate and make a municipal contribution to each municipal pension plan of an amount equal to not less than the municipal contribution to the municipal pension plan made in the immediately preceding year and the following percentage of the difference between that amount and the full minimum municipal obligation with respect to the pension plan under section 302 or 303 of the act, whichever is applicable:

(c) Increase in unfunded accrued liability for municipalities that are financially distressed. For a municipal pension plan of a municipality which has been determined to be financially distressed and to which a remedy of delayed implementation of the funding standard under section 607(g) or (h) of the act is applicable, increases in the unfunded accrued actuarial liability of the municipal pension plan attributable solely to the amortization of the unfunded accrued actuarial liability on a level percentage of payroll basis will not be deemed to be an actuarial experience loss within the meaning of section 202(b)(3)(V) or (4)(V) of the act (53 P. S. § 895.202(b)(3)(V) or (4)(V)).

(d) Continuation of amortization based on level percentage of payroll. For a municipal pension plan for which the municipality has elected to calculate the annual amortization contribution for the unfunded liability existing as of the beginning of the 1985 plan year on the basis of a level percentage of future increasing covered payroll, the portion of the amortization contribution attributable to that increment of unfunded actuarial accrued liability shall continue to be calculated on the same basis for each remaining year of the amortization period. If the municipality, by formal action of the governing body, permanently rescinds its prior election to use a level percentage of payroll basis for amortization of the applicable increment of unfunded actuarial accrued liability, the remaining balance of the applicable increment of unfunded actuarial accrued liability shall be amortized over the remaining years of the initial amortization period on a level dollar basis.

(e) Reduction of amortization period. For a municipal pension plan for which the municipality has elected to amortize the unfunded actuarial accrued liability existing as of the beginning of the 1985 plan year over a 40-year period under section 607(h) of the act, the municipality may, by formal action of the governing body, permanently rescind its prior election and amortize the remaining balance of the applicable increment of unfunded actuarial accrued liability by the end of the plan year occurring in calendar year 2015.

(f) Definition of municipal contribution. For the purpose of calculating the amount of the required contributions to the pension plan under section 607(g) or (h) of the act (53 P. S. § 895.607(g) and (h)) for plan years commencing after December 31, 1991, the term "municipal contribution" means the total contributions made by the municipality, including allocations of General Municipal Pension System State Aid.

(g) Termination of delayed implementation of funding standard. If a municipality provides aggregate funding to a municipal pension plan that satisfies the full minimum municipal obligation determined under section 302 or section 303 of the act (53 P. S. §§ 895.302 and 895.303), the municipality may not subsequently delay implementation of the funding standard under section 607(g) or (h) of the act in that municipal pension plan.