pension
Ordinances of 1987

Ordinances 13 and 14 of 1987 changed the way benefits are calculated.  Employees hired after 1987 now contribute to what is known as the "Municipal Benefit Plan No. 2".  Employees under pension number 2 now calculate their pensions according to this method.

For any questions about calculating your pension call the Pension Office at 412-255-2655

Ordinance: No.13

Supplementing the Pittsburgh Code, Title One, Administrative, Article XI, Personnel, by adding Chapter 192, "Pension Benefit Plans" and Section 192.01, "Definitions."

Whereas, the City has elected by Resolution 839 of 1985 to utilize Recovery Program Level III under the "Municipal Pension Plan Funding Standard and Recovery Act" (Act No. 205 of 1984, Public Law 1005, 53 P.S. 895.101 et. seq.) (hereafter referred to as the Act); and

Whereas, the Act requires, as a mandatory element of Recovery Program Level III, that the City establish revised benefit plans for each of the City's pension plans for newly hired employees.

192.01 Definitions * 192.01.01 Accumulated Contributions * 192.01.02 Average Monthly Earnings * 192.01.03 Benefit Plan * 192.01.04 Benefit Plan No.1 192.01.05 Benefit Plan No. 2 * 192.01.06 Beneficiary * 192.01.07 Board * 192.01.08 City * 192.01.09 Comprehensive Municipal Pension Trust Fund or Comprehensive Fund * 192.01.10 Credited Service  * 192.01.11 Early Retirement Age * 192.01.12 Firemen's Benefit Plan No. 1 * 192.01.13 Firemen's Benefit Plan No. 2 192.01.14 Firemen's Pension Plan * 192.01.15 Fund * 192.01.16 Member * 192.01.17 Member Contributions 192.01.18 Normal Retirement Age * 192.01.19 Municipal Benefit Plan No. 1 * 192.01.20 Municipal Benefit Plan No.2  * 192.01.21 Municipal Pension Plan 192.01.22 Pension Plan * 192.01.23 Pensioner 192.01.23 Policemen's Benefit Plan No. 1 * 192.01.25 Policemen's Benefit Plan No.2 * 192.01.26 Policemen's Pension Plan  * 192.01.27 Total and Permanent Disability

Chapter 192-Pensions

192.01 Definitions
The following terms shall have the following respective meanings for the purpose of this Chapter unless a different meaning is plainly required by the context.

192.01.01 Accumulated Contributions
Means the sum of a member's contributions to the respective benefit plan.

192.01.02 Average Monthly Earnings
Means the average of the last 48 consecutive months of the contributory earnings during employment by the City immediately preceding retirement or termination of service.
However, the respect to a member who would have otherwise been a member of municipal benefit plan No. 1 as defined herein but for his election of coverage under a municipal benefit plan No. 2, as herein defined, his average monthly earnings shall mean an amount equal to the sum of (i) and (ii) below:

             (i) the members average monthly earnings as determined under the municipal benefit plan No. 1 but multiplied by a fraction, the numerator of which is his credited service determined under such benefit plan and the denominator of which is his total credited service under such benefit plan and the municipal benefit plan No. 2.
             (ii) the members average monthly earnings as determined under the municipal benefit plan No. 2 but multiplied by a fraction, the numerator of which is his credited service determined under such benefit plan No. 2 and the denominator of which is his total credited service under benefit plan No. 1 and benefit plan No. 2.

192.01.03 Benefit Plan
Means that portion of a pension plan which deals specifically with the retirement annuity and benefit coverage provided by the pension plan, including, but not limited to, the types of coverage, the eligibility for and entitlement to retirement annuities and benefits, and the amount of retirement annuities and benefits.

192.01.04   Benefit Plan No. 1
Means the benefit plan established under the following statutory provisions which provide benefits for members employed by the City, the Bureau of Police or the Bureau of Fire prior to January 1, 1988.  Municipal Benefit Plan No. 1 - Act of May 28, 1915, P.L. 596, as amended, 53 P.S. 23581 et. seq. Policemen's Benefit Plan No. 1 - Act of April 5, 1917, P.L. 39, as amended, 52 P.S. 23642 et. seq. Firemen's Benefit Plan No. 1 - Act of May 25, 1933, P.L. 1050, as amended, 53 P.S. 23601 et. seq.

192.01.05 Benefit Plan No. 2
Means the benefit plan established pursuant to the provisions of this chapter.

192.01.06 Beneficiary
Means the person or persons last designated in writing by a member to receive his accumulated contributions at the time of his death.

192.01.07 Board
Means the Board of Managers established for each of the pension plans pursuant to the following Acts: Municipal Pension Plan - Act of May 25, 1915, P.L. 596, as amended, 53 P.S. 23581 et. seq. Policemen's Pension Plan - Act of April 5, 1917, P.L. 39, as amended, 53 P.S. 23642 et. seq. Firemen's Pension Plan - Act of May 25, 1933, P .L. 1050, as amended, 53 P .S. 23601 et. seq.

192.01.08 City
Means City of Pittsburgh and any agency or authority created by the City of Pittsburgh, or created by the City of Pittsburgh jointly with other cities or with another political subdivision or created by another political subdivision and jointed by the City, except where such agency or authority has in effect its own pension or retirement plan maintained  without reference to the provisions of any benefit plan referenced here under, in which case such pension or retirement plan shall be exclusive and such agency's or authority's employees shall not be entitled to any rights under a plan benefit.

192.01.09 Comprehensive Municipal Pension Trust Fund or Comprehensive Fund
Means the fund established by the City under Ordinance 25 of 1986 and pursuant to the requirements of Act 205 of 1984, P.H. 1005, 53 P.S. 895.101 et. seq.

192.01.10 Credited Service
Means any service of a member used in the determination of benefits provided that the required contributions have been made and are credited to his account in the fund.

192.01.11 Early Retirement Age
Means attainment of the stated age and required service to qualify for an early retirement benefit provided under a benefit plan.

192.01.12 Firemen's Benefit Plan No. 1
Means the benefit plan No. 1 established pursuant to Act of May 25, 1933, P.L. 1050 as amended to provide retirement benefits to members employed by the Bureau of Fire of the city prior to January 1, 1988.

192.01.13 Firemen's Benefit Plan No. 2
Means the benefit plan established pursuant to the provisions of this Chapter which provides benefits to those members employed by the Bureau of the City after December 31, 1987 and those individuals who were employed by the Bureau of Fire prior to January 1,1988 who have irrevocably elected to cease membership under the firemen's benefit plan No. 1 and commence membership under firemen's benefit plan No. 2.

192.01.14 Firemen's Pension Plan
Means the plan by which the City provides retirement benefits to members under the terms of firemen's benefit plan No. 1 and firemen's benefit plan No. 2.

192.01.15 Fund
means the created by the City in accordance with the statutory provisions contained in either the Act of May 28, 1915, P .L. 596, No. 259, (municipal fund), Act of May 25, 1933, P.L. 1050 (firemen's fund) and Act of April 5, 1917, P.L. 39 (policemen's fund).

192.01.16 Member
Means any employee or former employee who is making contributions to one of the pension plans in accordance with the provisions contained in the applicable benefit plan and any employee whose contributions have been discontinued due to the attainment of age 65.

192.01.17 Member Contributions
means the product of the compensation of the member and the contribution rate specified in the applicable pension plan.

192.01.18 Normal Retirement Age
Means the age at which a member is entitled to receive an unreduced retirement benefit after completing a specified number of years of service as defined in the applicable benefit plan.

192.01.19 Municipal Benefit Plan No. 1
Means the benefit plan established pursuant to the Act of May 28, 1915 (P.L. 596, No. 259) as amended to provide retirement benefits to members employed prior to January 1, 1988.

192.01.20 Municipal Benefit Plan No. 2
Means the benefit plan established pursuant to the provisions of this Chapter to provide retirement benefits to eligible employees employed after December 31,1987 and employees who had been employed prior to January 1,1988 who had been members under municipal benefit plan No, 1 and who have elected to cease membership under municipal benefit plan No. 1 and commence membership under municipal benefit plan No. 2.

192.01.21 Municipal Pension Plan
Means the pension plan in which the City provides retirement benefits to eligible members under the terms municipal benefit plan No. 1 and municipal benefit plan No. 2.

192.01.22 Pension Plan
Means the various aspects of the relationship between a municipality and its employees with respects to the retirement coverage provided by a municipality to the employees.

192.01.23 Pensioner
Means any employee who has terminated service under one of the pension plans and its receiving or has filed an application to receive pension benefits pursuant to the benefit plan in which he was a member.

192.01.24 Policemen's Benefit Plan No. 1
Means the benefit plan established under Act of April 5, 1917, P.L. 39, as amended by statute, resolution or ordinance to provide retirement benefits to members employed prior to January 1, 1988.

192.01.25 Policemen's Benefit Plan No. 2
Means the benefit plan established pursuant to the provisions of this Chapter for the purpose of providing retirement benefits to those members employed by the Bureau of Police after December 31,1987 or those individuals who were employed by the Bureau of Police prior to January 1,1988 who have irrevocably elected to cease membership under the policemen's benefit plan No. 1 and commence membership under policemen's benefit plan No. 2.

192.01.26 Policemen's Pension Plan
Means the plan by which the City provides retirement benefits to members under the terms of the policemen's benefit plan No. 1 and policemen's benefit plan No. 2.

192.01.27 Total and Permanent Disability
Means permanent incapacity due to bodily injury or disease which for period of at least six consecutive months has rendered the member unable to perform the duties for which he was employed.  Proof of total and permanent disability shall consist of the sworn statement of three practicing physicians who have been designated by the board that the member is in a permanent condition of health which would totally disable him from performing the duties of his position or office.

Ordinance: No. 14

Supplementing the Pittsburgh Code, Title One, Administrative, Article XI, Personnel, Chapter 192, Pensions, by adding Section 192.02, "Municipal Benefit Plan No. 2".

Whereas, the City has elected by Resolution 839 of 1985 to utilize Recovery Program Level III under the "Municipal Pension Plan Funding Standard and Recovery Act" (Act No. 205 of 1984, Public Law 1005, 53 P .S. 895.101 et. seq.) (hereafter referred to as the Act); and  Whereas, the Act requires, as a mandatory element of Recovery Program Level III, that the City establish revised benefit plans for each of the City's pension plans for newly hired employees;
The Council of the City of Pittsburgh hereby enacts as follows:
 

192.02.01 Establishment of Municipal Benefit plan No. 2 * 192.02.02 Membership * 192.02.03 Contributions by Members * 192.02.04 Contributions by the City * 192.02.05 Credited Service * 192.02.06 Pension Allowance * 192.02.07 Death Benefits * 192.02.08 Payment of Benefits

 

192.02.01 Establishment of Municipal Benefit Plan No. 2
There is hereby established a pension benefit plan which shall be known as the "Municipal Benefit Plan No. 2" for eligible employees of the City of Pittsburgh hired on or after January 1, 1988. The provisions contained in this municipal benefit plan No. 2 shall become a part of the municipal pension plan. This municipal benefit plan No. 2 specifically incorporates all of the provisions contained in municipal benefit plan No. 1 except to the extent that such provisions are specifically addressed and revised herein. Any reference in this section to a benefit plan No. 1, benefit plan No. 2 or pension plan shall be deemed to refer specifically to pertinent portions of the municipal pension plan.

192.02.02 Membership
(a) Membership shall be mandatory for all full-time employees hired on or after the effective date (January 1, 1988) of this benefit plan No. 2 following a 90-day probationary period; except that the following employees shall not be entitled to membership:
    (1) Employees protected by other pension systems authorized by the laws of this State.
    (2) Any temporary employees who do not have contributions in the municipal pension plan attributable to former membership in this benefit plan No. 2.   
    (3) Pensioners who are receiving full retirement benefits under the municipal pension plan and return to service.   
    (4) Any employees who are members under benefit plan No. 1 and do not elect membership under this benefit plan No. 2 within the time period established by the board.

(b) Membership shall be mandatory for a temporary employee rehired on or after January 1,1988 who was formerly a full-time employee and who has not withdrawn his accumulated contributions from the municipal pension plan.

(c) Membership shall be mandatory for any former employee who reenters the service of the City on or after the effective date of this benefit plan No. 2 and who does not reinstate his prior membership service under benefit plan No. 1. If any such former employee does reinstate his prior membership service under benefit plan No. 1, he shall continue to be a member under benefit plan No. 1.

(d) Membership may continue for any employee on an approved leave of absence for a period of up to two years during which he makes the required contributions.

(e) Membership shall continue for an employee who has terminated service after eight or more years of credited service and has elected to leave his contributions in the municipal pension plan.

(f) An employee who is a member under plan No. 1 may irrevocably elect out of membership under benefit plan No. 1 and into membership under this benefit plan No. 2 during the period of  July 1,1988 through September 30, 1988.

(g) Membership and all rights to benefits provided by this benefit plan No. 2 shall cease at the time an employee terminates city service and withdraws his accumulated contributions.

192.02.03 Contributions by Members
(a) Each member shall contribute to the municipal pension plan 4% of his salary or wages.

(b) The City shall cause to be deducted the required member contributions from each payroll and shall promptly send the amounts deducted to the comprehensive fund.

(c) Payment of the amount of contribution herein mentioned shall be discontinued at the time the  member retires, terminates service, attains age 65 with 20 or more years of credited service, dies or becomes totally and permanently disabled.

(d) Each person who becomes an employee of the City after having been employed by the city in the Bureau of Fire or the Bureau of Police, and who is not entitled to retirement benefits for such services under another retirement system and who desires to have such services credited under this benefit plan No. 2, shall be required to pay to the municipal pension plan an amount equal to 4% of the total salary or wages received by him for each month of service for which he wishes to receive credit together with interest at the rate earned by the comprehensive or other applicable fund during the period of such employment. Such amount shall be deducted from the monthly salary or wages of the member over a period of two years or in such manner and period as the board may determine.  Upon full payment of the amount due, the member shall receive full credit for said period of service. It any member shall be injured while in the actual performance of duty before he shall have made full contribution for past service, so long as the disability continues, he shall be eligible for pension under this benefit plan No. 2, but any amount which he shall not yet have paid to the municipal pension plan as a contribution for past services under this section at the date of his injury shall be paid, if the board, in its discretion, shall so determine, in such monthly amounts as the board may determine, which amounts shall be deducted from his or her pension as and when monthly payments thereof shall be made.

(e) Any member may purchase full credit toward his pension for each year of service with an agency or authority prior to the time such agency authority joined the municipal pension plan upon his producing proof satisfactory to the board of the number of years of such service and upon his making back payments as if he had been a member of this benefit plan No. 2 at the time of such service. The amount due may be paid in a lump sum or by installments, as may be agreed upon by the member and the board. If the employee is retired under this benefit plan No. 2 before the payments have been completed, his pension shall be reduced by an amount equivalent to the unpaid balance of the amount due.

(f) If a member terminates service before he is eligible to receive a pension, his accumulated contributions shall be refunded in full.

(g) Any former employee who has received a refund of his accumulated contributions and who shall reenter the service of the City, shall be eligible to receive credit for all previously credited service by restoring to the municipal pension plan the total accumulated contributions withdrawn.

(h) Any pensioner who had less than 20 years credited service or who had elected to receive an early reduced pension and who returns to service on or after the effective date of this benefit plan No. 2 shall start contributing at 4% of his salary or wages and shall be entitled to have his subsequent retirement pension be determined on the basis of his total service history by restoring to the municipal pension plan the total of the amount received in pension payments.

(i) School crossing guards who are members of this benefit plan No. 2 shall be given an opportunity to contribute full member contributions for the months of June, July and August of each year in which they covered under this plan and thereby receive credit for these months for purposes of both benefit calculations and average monthly earnings.

192.02.04 Contributions by the City
(a) The public officials of the City charged with the disbursements, expenditures, and appropriations, shall annually set aside, apportion, and appropriate, out of all taxes and income of the City, to the comprehensive fund, a sum sufficient to maintain the pensions due under the municipal pension plan.  It the total disbursements from the municipal pension plan for the payment of pensions, refund of accumulated contributions of members, and administration  expenses shall exceed in any year the total revenues of the municipal pension plan from member contributions and the interest and premiums on investments and bank deposits, then the amount to be set aside, apportioned and appropriated by the public officials of the City to the municipal pension plan shall not be less than the difference between the total disbursements and receipts of the municipal pension plan as aforesaid.

(b) Every authority or agency, whose employees are members of benefit plan No. 2, shall be held liable for the amount due to the fund on account of benefits provided by this benefit plan No. 2 which are paid to employees of such authority or agency. Provided, however, that where an employee of the authority or agency formally worked for the City, the authority or agency shall be held liable for that proportionate pad of the pension or other benefits paid which the authority or agency bears to the total credited service.

(c) All contributions required to be made under the municipal pension plan relating to regular member contributions for current service shall be picked up by the city and shall be treated as city contributions in determining tax treatment under the United States Internal Revenue Code for federal tax purposes. For all other purposes, under the municipal pension plan and otherwise, the pick up contributions shall be treated as contributions made by a member in the same manner and to the same extent as contributions made by a member prior to January 1, 1988.

192.02.05 Credited Service

(a) Credited Service shall be computed from the time of the first or original employment; said employment shall consist of service to the City, and need not be continuous, provided that contributions have been made in accordance with subsection (s) , (g) and (h) of section 192.02.03 for all periods of service.

(b) Any employee shall receive full credit for each year of service for which credit has been purchased under the provisions of subsection (d) and (e) of section 192.02.03.

(c) Any employee who shall have enlisted or been drafted to serve in the Armed Forces of the United States in time of war or shall have been drafted to serve in the Armed Forces of the United States in time of peace, shall have such service credited in full to his service record as service to the city.

192.02.06 Pension Allowance
(a) The amount of the monthly pension shall be calculated by multiplying the amount determined in paragraph (1) by the fraction determined in paragraph graph (2) and if applicable, by adding a service increment in accordance with paragraph (3) and where applicable by applying the reductions determined in paragraph (4) and paragraph (5).
     (1) 50% of the member's average monthly earnings.   
     (2) The ratio that the member's years of credited service (years and completed months to two decimals) up to a maximum 20 is to 20.   
     (3) A service increment which shall be 1% of the member's average monthly earnings for each full year of credited service in excess of 20 and rendered Prior to age 65. Such increment shall be limited to a maximum of $100 per month.
     (4) The member's pension shall be reduced upon his attainment of age 65 by an amount equal to 50% of the primary insurance amount paid or payable to him under the federal Social  Security Act and subject to the following provisions:
                               (i) The eligibility of such member for the old-age insurance benefit and the amount of  such benefit upon which the reduction in his pension shall be based shall be determined by the board in accordance with the provisions of the federal Social Security Act, 42 U.S.C. Section 301 et. seq., in effect at the date his pension payment begin, except that in determining such eligibility and such amount only wages or compensation for services covered by this benefit plan No. 2 shall be included.      
                               (ii) Whenever the amount of the reduction from the pension shall have been once determined, it shall remain fixed for the duration of the pension except that any decrease in the old-age insurance benefit under the federal Social Security Act, 42 U.S.C.    Section 301 et. seq., shall result in a corresponding decrease in the amount of the reduction from the pension.
                              (iii) The reduction shall not be more than one-half of the pension to which the member is otherwise entitled under the provisions of this benefit plan No. 2.   
(5) The member's pension shall be reduced for any periodic payments to him or on his behalf pursuant to worker's compensation laws on account of his employment with the City,  provided, however, that the pension benefit will be limited so that, when added to the monthly workers compensation benefit, the sum will not exceed the regular monthly earnings of the member at the time of disablement.
(b) The amount of any monthly pension of a member who terminates service Prior to age 60 shall be either of the following as the member may elect at the time of termination of services:
      (1) a deferred pension, commencing on attainment of age 60, computed under the provisions of  subsection (a) based only on credited service and average monthly earnings to the date of early retirement; or   
      (2) a reduced pension, commencing prior to age 60, equal to the deferred pension to which the member would have been eligible had he so elected, reduced 1/2% for each month that the commencement of the pension precedes the month of the member's attainment of age 60.

(c) The amount of any monthly pension for a disability retirement for a member who sustains disability in the actual performance of duty regardless of length of service or incurs a disability outside the performance of his duties but after 8 years of credited service shall be determined in accordance with subsection (a) based upon (i) or (ii) below, whichever is applicable;  
                               (i) if total and permanent disability is incurred prior to age 60, the member's average monthly earnings shall be determined at the date of disability and credited service shall be determined as though the member had attained age 60 and completed the greater of (1) his actual credited service of (2) the lesser of 20 years of credited service or the  number of years of credited service he would have completed he had continued to receive credit for service until age 60; or  
                               (ii) if total and permanent disability is incurred on or after age 60, the members average monthly earnings and actual credited service shall be determined at the date of disability.

(d) The amount of any pension to a member who has terminated service after attaining age 40 with at least 8 years of service shall be either of the following as the member may elect in his application for pension provided that such member continues to make member contributions until age 50:                              

                               (i) a deferred pension, after attainment of age 60, computed under the provisions of subsection (a) but based on credited service and average monthly earnings to the date of termination.  
                               (ii) an early pension, commending prior to age 60, but after attainment of age 50, determination in accordance with the provisions of paragraph (1), reduced 1/2% for each month that the commencement of the regular pension precedes the month of the member's attainment of age 60.

(e) Specifically excluded from this benefit plan No. 2 are any benefits provided under section 11 of benefit plan No. 1 for the payment of supplementary medical insurance premiums.

192.02.07 Death Benefits
(a) In the event of death of a member in active service who shall have had at least eight years credited service and shall have attained age 50, a survivor benefit shall become payable to his surviving spouse, if any, in an amount which shall be equal to 50% of the pension amount determined in section 192.02.06 which would have been payable had the deceased member retired on the day before his death. The amount of the survivor's benefits determined above shall be further reduced by 1% for each year excess of five years that the spouse is younger than the deceased member. The survivor's benefit shall be payable as long as the spouse lives or until remarriage.

(b) In the event of the death of any member in active service before the member has eight years of credited service and attains age 50, the member's accumulated contributions without interest shall be paid to such person or persons as he shall have designated in writing and filed with the board or if he has not so designated, then paid to his estate.

(c) Any married person who retires under the provisions of this benefit plan No. 2 may elect in writing at the time of retirement to receive a monthly pension determined in accordance with action 192.02.06 which shall be further reduced in accordance with table A attached hereto (depending on the age of the pensioner and his spouse at the time of retirement), with 50% of such amount payable to his surviving spouse after his death, provided that such person shall have been married to his spouse for not less than one year. In the event the spouse of a pensioner shall predecease such pensioner, the pensioner shall continue to receive such reduced pension payments for the remainder of his life. The surviving spouse shall be entitled, commencing the first day of the month next following the death of the pensioner,  to receive monthly payments equal to 50% of the monthly amount paid to the pensioner and such payments shall terminate upon death of such surviving spouse.

(d) In no case shall the total of payments made to a member or pensioner and his surviving spouse, if any, or his beneficiary or estate be less than the deceased members accumulated contributions to the comprehensive fund.

192.02.08 Payment of Benefits
(a) Monthly payments for immediate pensions shall be payable beginning with the first full calendar month following the month in which retirement occurs or the calendar month in which application for pension is made, whichever is later.

(b) The first of any deferred vested pension shall be paid as follows:   
      (1) for pensions commencing on or after attainment of age 60, the later of;
                               (i) the calendar month next following the member's  60th bid day, or
                               (ii) the calendar month in which the application for such payment is made; or

(2) for pensions commencing prior to attainment of age 60, the later of;
                               (i) the calendar month next following the member's  50th birthday, or
                               (ii) the calendar month in which application for such pension is made.

(c) The last payment of any pension shall be payable for the month in which the death of the pensioner shall occur.

(d) A pension payable under the municipal pension plan shall cease when the pensioner returns to city employment.   Pension payments shall be resumed upon subsequent discontinuance of service.

(e) Notwithstanding the above, the provisions of Ordinance No. 57 of 1985 shall remain in effect.

 

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