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BOARD SCHOOL DIRECTORS FOR TREDYFFRIN/EASTTOWN SCHOOL DISTRICT ET AL. v. PUBLIC SCHOOL EMPLOYEES' RETIREMENT BOARD (06/17/81)

decided: June 17, 1981.

THE BOARD OF SCHOOL DIRECTORS FOR TREDYFFRIN/EASTTOWN SCHOOL DISTRICT ET AL., PETITIONERS
v.
THE PUBLIC SCHOOL EMPLOYEES' RETIREMENT BOARD, RESPONDENT



Original jurisdiction in case of The Board of School Directors for the Tredyffrin/Easttown School District and the Board of School Directors for the Palisades Area School District, on behalf of themselves and on behalf of all other school districts in the Commonwealth of Pennsylvania v. The Public School Employees' Retirement Board.

COUNSEL

John S. Bevan, with him, Frank L. White, Jr., and Steven L. Sugarman, Duane, Morris & Heckscher, for petitioners.

Thomas J. Mangan, Jr., with him, Raymond Kleiman, Deputy Attorney General, and William H. Haubert, III, for respondent.

Catherine C. O'Toole, for Amicus Curiae, Pennsylvania State Education Association.

William Fearen, with him, Michael I. Levin, Cleckner and Fearen, for Amicus Curiae, Pennsylvania School Boards Association.

President Judge Crumlish and Judges Mencer, Rogers, Blatt, Craig, MacPhail and Palladino. Judges Wilkinson, Jr. and Williams, Jr. did not participate. Opinion by President Judge Crumlish. Judge Wilkinson, Jr., did not participate in the decision in this case. Concurring and Dissenting Opinion by Judge Blatt. Judge Rogers joins in this concurring and dissenting opinion.

Author: Crumlish,

[ 60 Pa. Commw. Page 2]

The Board of School Directors of the Tredyffrin/Easttown and Palisades Area School Districts bring this class action*fn1 for themselves and all public school

[ 60 Pa. Commw. Page 3]

    districts in the Commonwealth seeking declaratory and injunctive relief against the Public School Employes' Retirement Board's interpretation and enforcement of certain provisions of the Public School Employes' Retirement Code.*fn2 The Code requires employer contributions to retroactively fund extended benefits to part-time public school employees for any period of service prior to the 1979-1980 school year. They would also have us prevent the Board from deducting or causing to be deducted subsidies to which the school districts would be entitled or citing, surcharging, or imposing any civil or criminal penalty, liability or sanction in response to the school districts' refusal to retroactively fund extended benefits for part-time employees.

The parties have stipulated to the absence of any material issue of fact, and specified the sole legal question for our determination:

Whether 'part-time employees', as that term is defined by the Code, are entitled to secure certain retroactive retirement benefit credits for services rendered prior to the 1979-1980 school year; and, if so, (i) for what period of time may such credits be secured; and (ii) whether employers have any obligation to pay for the contributions attributable to such credits?

The school districts then filed the Motion for Summary Judgment asserting that, there being no genuine issue of material fact, they are entitled to judgment as a matter of law thus freeing them from contributory responsibility. We agree with the school districts only as to pre-1975-1976 school year contributions.

On October 2, 1975, our Legislature enacted a new Public School Employes' Retirement Code, 24 Pa.

[ 60 Pa. Commw. Page 4]

C.S. § 8101, which supersedes the former Retirement Code of 1959*fn3 and provides a modernized retirement system for public school employees. One of the major changes in the new Code required part-time employees, working on a per diem or hourly basis if not less than 80 full-day sessions or 500 hours in any fiscal year, to become members of the retirement system. 24 Pa. C.S. § 8301. The former Code compensated non-eligible part-time employees for services in accordance with contracted salary schedules.

Under the general provisions of the new Code, a public school employee-member of the system, either part-time or fulltime, is not only eligible for retirement benefits for current school service, 24 Pa. C.S. § 8302, but may finance credit for these benefits from three sources: [1] member contributions at a prescribed rate through salary deductions, 24 Pa. C.S. § 8321; [2] the "employer" school district payments pursuant to actuarial cost formula, 24 Pa. C.S. §§ 8327-8328; and/or [3] Commonwealth contributions in accordance with the same actuarial cost formula, 24 Pa. C.S. §§ 8326 and 8328. Although eligibility for retirement benefits based on both previous creditable school service, 24 Pa. C.S. § 8303(c), and previous creditable nonschool service, 24 Pa. C.S. §§ 8304(a), 8303(c), for fulltime members is uncontested, the part-time controversy centers upon not only the employees' option to purchase prior service credits for the pre-1975-1976 or even the pre-1979-1980 school years, but their respective sources of contribution.

Initially, amicus Pennsylvania School Boards Association argues that no provision of the Retirement Code permits members of the system to purchase credit for ...


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