73 Pa.C.S. § 4109 – Police pension fund

(a) Establishment.— If a township maintains a police force of fewer than three full-time members, unless there is a private organization or association constituting and managing an existing pension fund for the members of the police force in the township, the township shall, by ordinance, establish a police pension fund to be maintained by member contributions of an equal percentage charge against each member of the police force. Except to the extent that section 607(c) of the act of December 18, 1984 (P.L.1005, No.205), known as the Municipal Pension Plan Funding Standard and Recovery Act, applies, the member contributions shall not annually exceed 4% of the pay of the member.
(b) Investment or insurance instruments.— In lieu of establishing a pension fund in accordance with subsection (a), the township may, by ordinance, provide investment or insurance instruments for the purpose of the payment of pensions or annuities to the members of the police force who receive honorable discharge by reason of age or disability and the families of police officers injured or killed in service.
(c) Administration.—
1. (1) All pension funds or investment or insurance instruments established under this section shall be under the direction of the board of commissioners, or a committee as the board of commissioners may designate, and shall be applied under regulations as the board of commissioners may, by ordinance, prescribe for the benefit of the members of the police force who receive honorable discharge by reason of age or disability and the families of police officers injured or killed in service.
2. (2) The board of commissioners shall appoint by resolution a chief administrative officer who shall have the primary responsibility for the execution of the administrative affairs of the pension plan, subject to the direction of the board of commissioners.
3. (3) An allowance made to an individual who retires by reason of disability or age shall be in conformity with a uniform scale.
(d) Minimum service and age limit.— The ordinance establishing the police pension fund may prescribe a minimum period of continuous service of not less than 20 years and an age limit after which members of the police force may be retired from active duty and may be entitled to benefits of the fund.
(e) Charges.— Payments made on account of police pensions shall not be a charge on any fund in the treasury of the township or under the control of the township, except the police pension fund.
(f) Contributions.— A township that establishes a police pension fund under this section shall make contributions to the police pension fund in an amount sufficient to meet the minimum obligation of the municipality with respect to the pension plan under the Municipal Pension Plan Funding Standard and Recovery Act.
(g) Donations.— A township may take, by gift, grant, devise or bequest, money or property, whether real, personal or mixed, in trust for the benefit of the police pension fund. The care, management, investment and disposal of the trust funds or property, whether real, personal or mixed, shall be vested in the officers as the board of commissioners shall direct by ordinance and shall be governed by the officers, subject to any directions not inconsistent with the ordinance as the donors of the trust funds and property may prescribe.
(h) Apportionment.—
1. (1) The basis of the apportionment of the pension benefit shall:
  1. (i) be determined by the rate of monthly pay of the member at the date of death, honorable discharge or retirement; and
  2. (ii) not exceed in any year one-half the annual pay of the member, computed at the member's monthly rate.
2. (2) An individual who participates in the police pension fund and becomes entitled to receive a benefit from the fund shall not be deprived of the individual's right to an equal and proportionate share of the fund upon the basis upon which the individual first became entitled to the benefit.
(i) (Reserved).
(j) Effect of other laws.— The act of May 29, 1956 (1955 P.L.1804, No.600), referred to as the Municipal Police Pension Law, or the act of February 1, 1974 (P.L.34, No.15), known as the Pennsylvania Municipal Retirement Law, shall govern a township police pension fund not established under the provisions of this section.