Pennsylvania HB 418: An Act amending the act of August 31, 1971 (P.L.398, No.96), known as the County Pension Law, providing for County Employees' Defined Contribution Plan.

Bill Text

PRINTER'S NO. 393
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 418
Session of
2025
INTRODUCED BY SCHLEGEL, ROAE, COOPER, KEPHART AND ZIMMERMAN,
JANUARY 30, 2025
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, JANUARY 30, 2025
AN ACT
Amending the act of August 31, 1971 (P.L.398, No.96), entitled
"An act providing for the creation, maintenance and operation
of a county employes' retirement system, and imposing certain
charges on counties and providing penalties," providing for
County Employees' Defined Contribution Plan.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of August 31, 1971 (P.L.398, No.96),
known as the County Pension Law, is amended by adding a section
to read:
Section 30.1. County Employees' Defined Contribution Plan.--
(a) The County Employees' Defined Contribution Plan is
established. The board shall administer and manage the plan
which shall be a defined contribution plan exclusively for the
benefit of those county employes who participate in the plan and
their beneficiaries within the meaning of and in conformity with
IRC § 401(a). The board shall determine the terms and provisions
of the plan not inconsistent with this act, the IRC or other
applicable law and shall provide for the plan's administration.
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(b) The County Employees' Defined Contribution Trust is
established as part of the plan. The trust shall be comprised of
the individual investment accounts and all assets and money in
those accounts, and any assets and money held by the board as
part of the plan that are not allocated to individual investment
accounts. The members of the board shall be the trustees of the
trust, which shall be administered exclusively for the benefit
of those county employes who participate in the plan and their
beneficiaries within the meaning of and in conformity with IRC §
401(a). The board shall determine the terms and provisions of
the trust not inconsistent with this act, the IRC or other
applicable law and shall provide for the investment and
administration of the trust.
(c) All assets and income in the plan that have been or
shall be withheld or contributed by the participants, the county
and other employers in accordance with this act shall be held in
trust in any funding vehicle permitted by the applicable
provisions of the IRC for the exclusive benefit of the
participants and their beneficiaries until such time as the
funds are distributed to the participants or their beneficiaries
in accordance with the terms of the plan document. The assets of
the plan held in trust for the exclusive benefit of the
participants and their beneficiaries may be used for the payment
of the fees, costs and expenses related to the administration
and investment of the plan and the trust.
(d) The board shall specify the terms and provisions of the
plan and trust in a document containing the terms and conditions
of the plan and in a trust declaration that shall be published
in the county records. Any amendment to the plan and trust
declaration also shall be published.
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(e) The board shall establish in the trust an individual
investment account for each participant in the plan. All
contributions by a participant or an employer for or on behalf
of a participant shall be credited to the participant's
individual investment account, together with all interest and
investment earnings and losses. Investment and administrative
fees, costs and expenses shall be charged to the participants'
individual investment accounts except as otherwise provided
under this act or as the county otherwise provides by
appropriations from the county general fund. Employer defined
contributions shall be recorded and accounted for separately
from participant contributions, but all interest, investment
earnings and losses, and investment and administrative fees,
costs and expenses shall be allocated proportionately.
(f) (1) A participant shall make mandatory pickup
participant contributions through payroll deductions to the
participant's individual investment account equal to a rate as
determined by the board. The employer shall cause those
contributions for current service to be made and deducted from
each payroll or on such schedule as established by the board.
(2) A participant may make voluntary contributions through
payroll deductions, through direct trustee-to-trustee transfers,
or through transfers of money received in an eligible rollover
into the trust to the extent allowed by IRC § 402. The rollovers
shall be made in a form and manner as determined by the board,
shall be credited to the participant's individual investment
account and shall be separately accounted for by the board.
(3) No contributions may be allowed that would cause a
violation of the limitations related to contributions applicable
to governmental plans contained in