Pennsylvania House Republican Caucus
07/18/2024 | Press release | Distributed by Public on 07/18/2024 13:19
Schlegel Bill Would Expand Options for County Pension Plans
Jul. 18, 2024
HARRISBURG - Rep. John Schlegel (R-Lebanon) is sponsoring legislation that would provide Pennsylvania's county governments the option to offer their employees the same types of pension plans as those available to state and municipal employees. Currently, counties are permitted to offer their employees only a defined benefit pension plan. House Bill 2507 would provide counties with the option to offer a defined contribution plan instead.
"Unlike defined benefit plans that can place a significant financial burden on counties due to guaranteed payouts based on predetermined formulas, defined contribution plans are similar to the 401k-style plans offered in the private sector that provide employees with individual retirement accounts funded with contributions by both the employer and employee," said Schlegel.
"They also provide employees with flexibility and portability of their retirement savings, which can be particularly attractive to younger workers and those who want greater control over their retirement investments. By allowing employees to choose between the two types of plans, they are empowered to make the decision that best suits them and their financial and career goals."
Under Schlegel's bill, county employees already enrolled in defined benefit plans would retain their plans and benefits without any changes. The existence of the defined contribution plan would not affect their existing entitlements.
"This legislation would modernize our county pension systems by balancing fiscal responsibility with our need to attract and retain a talented workforce," said Schlegel. "House Bill 2507 would achieve this by enabling our counties to offer their employees the flexibility and security they need in today's ever-changing job market."
Representative John Schlegel
101st Legislative District
Pennsylvania House of Representatives
Media Contact: Donna Pinkham
717.260.6452
[email protected]
RepSchlegel.com / Facebook.com/RepSchlegel
"Unlike defined benefit plans that can place a significant financial burden on counties due to guaranteed payouts based on predetermined formulas, defined contribution plans are similar to the 401k-style plans offered in the private sector that provide employees with individual retirement accounts funded with contributions by both the employer and employee," said Schlegel.
"They also provide employees with flexibility and portability of their retirement savings, which can be particularly attractive to younger workers and those who want greater control over their retirement investments. By allowing employees to choose between the two types of plans, they are empowered to make the decision that best suits them and their financial and career goals."
Under Schlegel's bill, county employees already enrolled in defined benefit plans would retain their plans and benefits without any changes. The existence of the defined contribution plan would not affect their existing entitlements.
"This legislation would modernize our county pension systems by balancing fiscal responsibility with our need to attract and retain a talented workforce," said Schlegel. "House Bill 2507 would achieve this by enabling our counties to offer their employees the flexibility and security they need in today's ever-changing job market."
Representative John Schlegel
101st Legislative District
Pennsylvania House of Representatives
Media Contact: Donna Pinkham
717.260.6452
[email protected]
RepSchlegel.com / Facebook.com/RepSchlegel
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