§8321. Regular member contributions for current service.

(a) General.--Regular member contributions shall be made to the fund on behalf of each active member for current service except for any period of current service in which the making of such contributions has ceased solely by reason of any provision of this part relating to the limitations under IRC § 401(a)(17) or 415(b).

(b) Class T-E and Class T-F shared-risk contributions.--Commencing with the annual actuarial valuation performed under section 8502(j) (relating to administrative duties of board), for the period ending June 30, 2014, and every three years thereafter, the board shall compare the actual investment rate of return, net of fees, to the annual interest rate adopted by the board for the calculation of the normal contribution rate, based on the market value of assets, for the prior ten-year period. If the actual investment rate of return, net of fees, is less than the annual interest rate adopted by the board by an amount of 1% or more, the shared-risk contribution rate of Class T-E and T-F members will increase by .5%. If the actual investment rate of return, net of fees, is equal to or exceeds the annual interest rate adopted by the board, the shared-risk contributions rate of Class T-E and T-F members will decrease by .5%. Class T-E and T-F members will contribute at the total member contribution rate in effect when they are hired. The total member contribution rate for Class T-E members shall not be less than 7.5%, nor more than 9.5%. The total member contribution rate for Class T-F members shall not be less than 10.3%, nor more than 12.3%. Notwithstanding this subsection, if the system's actuarial funded status is 100% or more as of the date used for the comparison required under this subsection, as determined in the current annual actuarial valuation, the shared-risk contribution rate shall be zero. In the event that the annual interest rate adopted by the board for the calculation of the normal contribution rate is changed during the period used to determine the shared-risk contribution rate, the board, with the advice of the actuary, shall determine the applicable rate during the entire period, expressed as an annual rate.

(1) Until the system has a ten-year period of investment rate of return experience following the effective date of this subsection, the look-back period shall begin not earlier than the effective date of this subsection.

(2) For any fiscal year in which the employer contribution rate is lower than the final contribution rate under section 8328(h) (relating to actuarial cost method), the total member contribution rate for Class T-E and T-F members shall be prospectively reset to the basic contribution rate.

(3) There shall be no increase in the member contribution rate if there has not been an equivalent increase to the employer contribution rate over the previous three-year period.

(July 22, 1983, P.L.104, No.31, eff. imd.; Dec. 19, 1984, P.L.1191, No.226, eff. imd.; Dec. 20, 1995, P.L.689, No.77, eff. July 1, 1996; May 17, 2001, P.L.26, No.9, eff. imd.; Nov. 23, 2010, P.L.1269, No.120)

Notation

2010 Amendment.  Act 120 amended the entire section, effective July 1, 2011, as to subsec. (b) and immediately as to the remainder of the section. See section 21 of Act 120 in the appendix to this title for special provisions relating to changes in accrued liability of Public School Employees' Retirement System.

Class T-B Members.  See section 3(3) of Act 96 of 1975 in the appendix to this title for the continuation of rights of members of Class T-B under former provisions of law relating to contributions for current service.

Cross References.  Section 8321 is referred to in sections 8322, 8322.1, 8502, 8536 of this title; section 4104 of Title 71 (State Government).