SB372 Summary

• Increases participant contribution rate to the Birmingham pension system to 7.5 percent effective July 1, 2021, applicable to all participants regardless of hire date.

• Revises employer contribution rate to an actuarially determined amount necessary to fully fund the system and amortize unfunded accrued liability over a closed 30-year period beginning July 1, 2021.

• Modifies normal retirement eligibility and benefits for new participants hired after July 1, 2021 (excluding fire and police): requires age 62 with 10+ years service OR age 55 with 30+ years service, and reduces benefit formula from 2.25% to 1.75% per year of service with a 52.5% maximum benefit.

• Eliminates subsidized spousal survivor benefits for new participants hired after July 1, 2021, and requires participants to elect either an actuarially reduced benefit providing survivor coverage or an unreduced benefit with no survivor benefits.

• Reduces early retirement benefit rate from 1.85% to 1.45% per year of service for new participants hired after July 1, 2021, and lowers ordinary disability allowance from 2% to 1.75% with a 52.5% maximum cap.