2010 Pennsylvania Code
Title 24 - EDUCATION
Chapter 81 - Preliminary Provisions
8102 - Definitions.

     § 8102.  Definitions.
        The following words and phrases when used in this part shall
     have, unless the context clearly indicates otherwise, the
     meanings given to them in this section:
        "Accumulated deductions."  The total of pickup contributions
     and the contributions paid into the fund by the member on
     account of current school service, previous school service, or
     creditable nonschool service and the statutory interest credited
     on all such contributions.
        "Activated military service."  Military service by a member
     of a reserve component of the armed forces, pursuant to an order
     on or after July 1, 1990, to enter into active military service,
     other than an order to enter into active duty to meet periodic
     training requirements, who was an active member of the system
     immediately preceding the order into active military service and
     to whom the military leave provisions of 51 Pa.C.S. Ch. 73
     (relating to military leave of absence) do not apply.
        "Active member."  A school employee for whom pickup
     contributions are being made to the fund or for whom such
     contributions otherwise required for current school service are
     not being made solely by reason of any provision of this part
     relating to the limitations under section 401(a)(17) or 415(b)
     of the Internal Revenue Code of 1986 (Public Law 99-514, 26
     U.S.C. § 401(a)(17) or 415(b)).
        "Actuarially equivalent."  Equal present values, computed on
     the basis of statutory interest and the mortality tables adopted
     by the board.
        "Actuary."  The consultant to the board who shall be:
            (1)  a member of the American Academy of Actuaries;
            (2)  an individual who has demonstrated to the
        satisfaction of the Insurance Commissioner of Pennsylvania
        that he has the educational background necessary for the
        practice of actuarial science and has had at least seven
        years of actuarial experience; or
            (3)  a firm, partnership, or corporation of which at
        least one member meets the requirements of paragraph (1) or
        (2).
        "Alternate payee."  Any spouse, former spouse, child or
     dependent of a member who is recognized by a domestic relations
     order as having a right to receive all or a portion of the
     moneys payable to that member under this part.
        "Alternative investment."  An investment in a private equity
     fund, private debt fund, venture fund, real estate fund, hedge
     fund or absolute return fund.
        "Alternative investment vehicle."  A limited partnership,
     limited liability company or any other legal vehicle for
     authorized investments under section 8521(i) (relating to
     management of fund and accounts) through which the system makes
     an alternative investment.
        "Annuitant."  Any member on or after the effective date of
     retirement until his annuity is terminated.
        "Approved domestic relations order."  Any domestic relations
     order which has been determined to be approved in accordance
     with section 8533.1 (relating to approval of domestic relations
     orders).
        "Approved leave of absence."  A leave of absence for
     activated military service or which has been approved by the
     employer for sabbatical leave, service as an exchange teacher,
     service with a collective bargaining organization or
     professional study.
        "Basic contribution rate."  For Class T-A, T-B and T-C
     service, the rate of 6 1/4%. For Class T-D service, the rate of
     7 1/2%. For all active members on the effective date of this
     provision who are currently paying 5 1/4% and elect Class T-D
     service, the rate of 6 1/2%.
        "Beneficiary."  The person or persons last designated in
     writing to the board by a member to receive his accumulated
     deductions or a lump sum benefit upon the death of such member.
        "Board."  The Public School Employees' Retirement Board or
     the Public School Employes' Retirement Board.
        "Class of service multiplier."

                    Class of service            Multiplier
                          T-A                        .714
                          T-B                        .625
                          T-C                       1.000
                          T-D                       1.000

        "Commissioner."  The Commissioner of the Internal Revenue
     Service.
        "Compensation."  Pickup contributions plus any remuneration
     received as a school employee excluding reimbursements for
     expenses incidental to employment and excluding any bonus,
     severance payments, any other remuneration or other emolument
     received by a school employee during his school service which is
     not based on the standard salary schedule under which he is
     rendering service, payments for unused sick leave or vacation
     leave, bonuses or other compensation for attending school
     seminars and conventions, payments under health and welfare
     plans based on hours of employment or any other payment or
     emolument which may be provided for in a collective bargaining
     agreement which may be determined by the Public School
     Employees' Retirement Board to be for the purpose of enhancing
     compensation as a factor in the determination of final average
     salary, provided, however, that the limitation under section
     401(a)(17) of the Internal Revenue Code of 1986 (Public Law 99-
     514, 26 U.S.C. § 401(a)(17)) taken into account for the purpose
     of member contributions, including regular or joint coverage
     member contributions, regardless of class of service, shall
     apply to each member who first became a member of the Public
     School Employes' Retirement System on or after July 1, 1996, and
     who by reason of such fact is a noneligible member subject to
     the application of the provisions of section 8325.1 (relating to
     annual compensation limit under IRC § 401(a)(17)).
        "Concurrent service."  Simultaneously credited school and
     State service.
        "Creditable nonschool service."  Service other than service
     as a school employee for which an active member may obtain
     credit.
        "Credited service."  School or creditable nonschool service
     for which the required contributions have been made, or for
     which the contributions otherwise required for such service were
     not made solely by reason of any provision of this part relating
     to the limitations under section 401(a)(17) or 415(b) of the
     Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. §
     401(a)(17) or 415(b)), or for which salary deductions or lump
     sum payments have been agreed upon in writing.
        "Date of termination of service."  The last date of service
     for which pickup contributions are made for an active member or,
     in the case of an inactive member, the effective date of his
     resignation or the date his employment is formally discontinued
     by his employer or two years following the last day of service
     for which contributions were made, whichever is earliest.
        "Disability annuitant."  A member on or after the effective
     date of disability until his disability annuity or the portion
     of his disability annuity payments in excess of any annuity to
     which he may otherwise be entitled is terminated.
        "Distribution."  Payment of all or any portion of a person's
     interest in the Public School Employees' Retirement Fund which
     is payable under this part.
        "Domestic relations order."  Any judgment, decree or order,
     including approval of a property settlement agreement, entered
     on or after the effective date of this definition by a court of
     competent jurisdiction pursuant to a domestic relations law
     which relates to the marital property rights of the spouse or
     former spouse of a member, including the right to receive all or
     a portion of the moneys payable to that member under this part
     in furtherance of the equitable distribution of marital assets.
     The term includes orders of support as that term is defined by
     23 Pa.C.S. § 4302 (relating to definitions) and orders for the
     enforcement of arrearages as provided in 23 Pa.C.S. § 3703
     (relating to enforcement of arrearages).
        "Effective date of retirement."  The first day following the
     date of termination of service of a member if he has properly
     filed an application for an annuity within 90 days of such date
     or:
            (1)  In the case of a member who applies for an annuity
        subsequent to 90 days after termination of service, the date
        of filing such application or the date specified on the
        application, whichever is later.
            (2)  In the case of a vestee who files an application for
        an annuity within 90 days of his superannuation age, the
        attainment of such age.
            (3)  In the case of a vestee who defers the filing of an
        application for an annuity to a date later than 90 days
        following attainment of superannuation age, the date of
        filing or the date specified on the application, whichever is
        later.
            (4)  In the case of a finding of disability, the date
        certified by the board as the effective date of disability.
        "Eligible annuitants."  All current and prospective
     annuitants with 24 1/2 or more eligibility points and all
     current and prospective disability annuitants. Beginning January
     1, 1995, "eligible annuitants" shall include members with 15 or
     more eligibility points who terminated or who terminate school
     service on or after attaining superannuation retirement age and
     who are annuitants with an effective date of retirement after
     superannuation age.
        "Eligibility points."  Points which are accrued by an active
     member or a multiple service member who is an active member of
     the State Employees' Retirement System for credited service and
     are used in the determination of eligibility for benefits as
     provided in section 8306 (relating to eligibility points).
        "Employer."  Any governmental entity directly responsible for
     the employment and payment of the school employee and charged
     with the responsibility of providing public education within
     this Commonwealth, including but not limited to: State-owned
     colleges and universities, the Pennsylvania State University,
     community colleges, area vocational-technical schools,
     intermediate units, the State Board of Education, Scotland
     School for Veterans' Children, Thaddeus Stevens State School of
     Technology, and the Pennsylvania State Oral School for the Deaf.
        "Final average salary."  The highest average compensation
     received as an active member during any three nonoverlapping
     periods of 12 consecutive months with the compensation for part-
     time service being annualized on the basis of the fractional
     portion of the school year for which credit is received; except,
     if the employee was not a member for three such periods, the
     total compensation received as an active member annualized in
     the case of part-time service divided by the number of such
     periods of membership; in the case of a member with multiple
     service credit, the final average salary shall be determined by
     reference to compensation received by him as a school employee
     or a State employee or both; and, in the case of a noneligible
     member, subject to the application of the provisions of section
     8325.1 (relating to annual compensation limit under IRC §
     401(a)(17)).
        "Full coverage member."  Any member for whom regular member
     pickup contributions are being picked up or who has paid or has
     agreed to pay to the fund the actuarial equivalent of regular
     member contributions due on account of service prior to January
     1, 1983.
        "Fund."  The Public School Employees' Retirement Fund.
        "Governmental entity."  Board of school directors, board of
     public education, intermediate unit board of directors, area
     vocational-technical board, any governing board of any agency or
     authority created by them, and the Commonwealth.
        "Inactive member."  A member for whom no pickup contributions
     are being made, except in the case of an active member for whom
     such contributions otherwise required for current school service
     are not being made solely by reason of any provision of this
     part relating to the limitations under section 401(a)(17) or
     415(b) of the Internal Revenue Code of 1986 (Public Law 99-514,
     26 U.S.C. § 401(a)(17) or 415(b)), who has accumulated
     deductions standing to his credit in the fund and for whom
     contributions have been made within the last two school years or
     a multiple service member who is active in the State Employees'
     Retirement System.
        "Intervening military service."  Active military service of a
     member who was a school employee immediately preceding his
     induction into the armed services or forces of the United States
     in order to meet a draft obligation excluding any voluntary
     extension of such obligational service and who becomes a school
     employee within 90 days of the expiration of such service.
        "IRC."  The Internal Revenue Code of 1986, as designated and
     referred to in section 2 of the Tax Reform Act of 1986 (Public
     Law 99-514, 100 Stat. 2085, 2095). A reference in this part to
     "IRC §    " shall be deemed to refer to the identically numbered
     section and subsection or other subdivision of such section in
     26 United States Code (relating to Internal Revenue Code).
        "Irrevocable beneficiary."  The person or persons permanently
     designated by a member in writing to the board pursuant to an
     approved domestic relations order to receive all or a portion of
     the accumulated deductions or lump sum benefit payable upon the
     death of such member.
        "Irrevocable survivor annuitant."  The person permanently
     designated by a member in writing to the board pursuant to an
     approved domestic relations order to receive an annuity upon the
     death of such member.
        "Joint coverage member."  Any member who agreed prior to
     January 1, 1966 to make joint coverage member contributions to
     the fund and has not elected to become a full coverage member.
        "Joint coverage member contributions."  Regular member
     contributions reduced for a joint coverage member.
        "Leave for service with a collective bargaining
     organization."  Paid leave granted to an active member by an
     employer for purposes of working full time for or serving full
     time as an officer of a Statewide employee organization or a
     local collective bargaining representative under the act of July
     23, 1970 (P.L.563, No.195), known as the Public Employe
     Relations Act: Provided, That greater than one-half of the
     members of the employee organization are active members of the
     system; that the employer shall fully compensate the member,
     including, but not limited to, salary, wages, pension and
     retirement contributions and benefits, other benefits and
     seniority, as if he were in full-time active service; and that
     the employee organization shall fully reimburse the employer for
     such salary, wages, pension and retirement contributions and
     benefits and other benefits and seniority.
        "Maternity leave of absence."  An involuntary leave of
     absence required by the employer because of the pregnancy of the
     member and commencing prior to May 17, 1975.
        "Member."  Active member, inactive member, annuitant, or
     vestee.
        "Member's annuity."  The single life annuity which is
     actuarially equivalent on the effective date of retirement to
     the accumulated deductions standing to the member's credit in
     the members' savings account.
        "Military service."  All active military service for which a
     member has received a discharge other than an undesirable, bad
     conduct, or dishonorable discharge.
        "Multiple service."  Credited service of a member who has
     elected to combine his credited service in both the Public
     School Employees' Retirement System and the State Employees'
     Retirement System.
        "Noneligible member."  For the purposes of section 8325.1
     (relating to annual compensation limit under IRC § 401(a)(17)),
     a member who first became a member on or after July 1, 1996.
        "Participating eligible annuitants."  All eligible annuitants
     who are enrolled or elect to enroll in a health insurance
     program approved by the Public School Employees' Retirement
     Board.
        "Pickup contributions."  Regular or joint coverage member
     contributions which are made by the employer for active members
     for current service on and after January 1, 1983.
        "Previous school service."  Service rendered as a school
     employee including service in any summer school conducted by a
     school district of the Commonwealth prior to the member's most
     recent entrance in the system.
        "Public school."  Any or all classes or schools within this
     Commonwealth conducted under the order and superintendence of
     the Department of Education including, but not limited to: all
     educational classes of any employer charged with the
     responsibility of public education within this Commonwealth as
     well as those classes financed wholly or in part by the Federal
     Government, State-owned colleges and universities, the
     Pennsylvania State University, community colleges, area
     vocational-technical schools, intermediate units, the State
     Board of Education, Scotland School for Veterans' Children,
     Thaddeus Stevens State School of Technology, and the
     Pennsylvania State Oral School for the Deaf.
        "Public School Code."  The act of March 10, 1949 (P.L.30,
     No.14), known as the Public School Code of 1949.
        "Regular member contributions."  The product of the basic
     contribution rate and the compensation of the member.
        "Reserve component of the armed forces."  The United States
     Army Reserve, United States Navy Reserve, United States Marine
     Corps Reserve, United States Coast Guard Reserve, United States
     Air Force Reserve, Pennsylvania Army National Guard and
     Pennsylvania Air National Guard.
        "Salaried employee."  A school employee who is compensated on
     the basis of an annual salary.
        "Salary deductions."  The amounts certified by the board,
     deducted from the compensation of an active member or the State
     service compensation of a multiple service member who is an
     active member of the State Employees' Retirement System and paid
     into the fund.
        "School employee."  Any person engaged in work relating to a
     public school for any governmental entity and for which work he
     is receiving regular remuneration as an officer, administrator
     or employee excluding, however, any independent contractor or a
     person compensated on a fee basis.
        "School entity."  A school district of any class,
     intermediate unit or an area vocational-technical school, as
     provided for under the act of March 10, 1949 (P.L.30, No.14),
     known as the Public School Code of 1949.
        "School service."  Service rendered as a school employee.
        "School year."  The 12-month period which the governmental
     entity uses for purposes of administration regardless of the
     actual time during which a member renders service.
        "Severance payments."  Any payments for unused vacation or
     sick leave and any additional compensation contingent upon
     retirement including payments in excess of the scheduled or
     customary salaries provided for members within the same
     governmental entity with the same educational and experience
     qualifications who are not terminating service.
        "Standard single life annuity."  For Class T-A, T-B and T-C
     credited service of a member, an annuity equal to 2% of the
     final average salary, multiplied by the total number of years
     and fractional part of a year of credited service of a member.
     For Class T-D credited service of a member, an annuity equal to
     2.5% of the final average salary, multiplied by the total number
     of years and fractional part of a year of credited service.
        "State Employees' Retirement System."  The retirement system
     established by the act of June 27, 1923 (P.L.858, No.331) and
     codified by the act of June 1, 1959 (P.L.392, No.78) and by Part
     XXV of Title 71 (relating to retirement for State employees and
     officers), added March 1, 1974 (P.L.125, No.31).
        "State service."  Service rendered as a State employee and
     credited as service in the State Employees' Retirement System.
        "Statutory interest."  Interest at 4% per annum, compounded
     annually.
        "Superannuation annuitant."  An annuitant whose annuity first
     became payable on or after the attainment of superannuation age
     and who is not a disability annuitant.
        "Superannuation or normal retirement age."

                Class of service            Age
                    T-A             62 or any age upon accrual
                                       of 35 eligibility points
                    T-B             62
                    T-C and T-D     62 or age 60 provided the
                                       member has at least 30
                                       eligibility points or
                                       any age upon accrual of
                                       35 eligibility points

        "Survivor annuitant."  The person or persons last designated
     by a member under a joint and survivor annuity option to receive
     an annuity upon the death of such member.
        "System."  The Public School Employes' Retirement System of
     Pennsylvania as established by the act of July 18, 1917
     (P.L.1043, No.343), and codified by the act of June 1, 1959
     (P.L.350, No.77).
        "Valuation interest."  Interest at 5 1/2% per annum,
     compounded annually and applied to all accounts other than the
     members' savings account.
        "Vestee."  A member with five or more eligibility points who
     has terminated school service, has left his accumulated
     deductions in the fund and is deferring filing of an application
     for receipt of an annuity.
     (Nov. 9, 2006, P.L.1371, No.148, eff. imd.)

        2006 Amendment.  Act 148 added the defs. of "alternative
     investment" and "alternative investment vehicle."
        2009 Partial Repeal.  Section 7 of Act 50 of 2009 provided
     that section 8102 is repealed insofar as it is inconsistent with
     Act 50.