More details of the pension reform bill (HB 2135) have been made available through the January 8, 2010 edition of PSBA's School Leader News. Under the new reform bill, the pension system would have a new class of employees who would belong to both a defined benefit system and a defined contribution system. Under the defined benefit component of the proposed hybrid pension system, new employees would contribute 3.25% of their salary, have a multiplier of 1% and go through a 10 year vesting period. With the defined contribution component, employees would have to contribute a minimum of 3% of their salary to an Individual Annuity Savings Account, but could contribute a higher percentage. School districts would have to contribute 2% of the employees salary to this side of the hybrid system. Overall, in this new hybrid system, new employees would contribute a minimum of 6.25% of their salary compared to the mandated 7.5% being contributed by current employees.

The state legislators for our legislative districts are Representative Sandra Major and Senator Lisa Baker. Representative Major can be contacted through her website at http://repmajor.com and Senator Baker can be contacted through her website at http://senatorbaker.com .

PSBA (Pennsylvania School Boards Association) has had its pension proposal introduced into both houses of the PA General Assembly. The PSBA proposal to fix the "pension crisis" in Pennsylvania involves changing the pension benefits and pension structure for all new school employees hired after June 30, 2010. The defined pension benefits for these new employees would be lower than those for current school employees but the new employees would have the ability to make contributions to a defined contribution program. The proposal allows new school employees to have the benefits of both a defined contribution system and a defined benefit system while reducing the financial burden on school district and state taxpayers.

The school district would not be able to cover a 28%+ increase in the PSERS rate without a massive increase real estate taxes. The PSERS Rate for the 2010-2011 school year has been set at 8.22%. When compared to this year's rate of 4.78%, the 2010-2011 rate reflects a 71.9% increase.