Section 12720.705 - Emergency payment deferral(a)Application.--Notwithstanding any provision of law, including, but not limited to, the act of December 18, 1984 (P.L. 1005, No. 205), known as the Municipal Pension Plan Funding Standard and Recovery Act, municipal ordinance, municipal resolution, municipal charter, pension plan agreement or pension plan contract to the contrary, this section shall apply to a city which has established and maintained, directly or indirectly, a pension plan for the benefit of its employees, irrespective of the manner in which the pension plan is administered and to the respective pension plan.(b)Legislative finding.--The General Assembly finds that, until such time as the authority has been established and is able to provide necessary financial assistance to cities and when there is imminent danger that a city will be unable to pay its outstanding indebtedness and to provide basic services critical to the health and safety of its inhabitants, it is essential that the State exercise its sovereign power to safeguard the vital interests of its people by precluding such city from taking actions upon the existence of certain conditions which would be against the general good of such city and of the Commonwealth and that doing so is clearly for the promotion of the commonweal, the general good of the public and is a proper exercise of the sovereign right of the Commonwealth to protect lives, health, comfort and the general welfare of all people of the Commonwealth.(c)Funding of pension plans.--(1) The Secretary of the Budget shall examine prior to June 30, 1991, the financial condition of cities which have established pension plans for the benefit of their employees and shall determine based on such examination if any city's payment of its minimum obligation to fund its pension plan for the fiscal year ending June 30, 1991, is likely to cause the city to be unable to pay, prior to the city's receipt of the proceeds of the first series of bonds issued to finance a deficit described in section 317, the following: (i) principal of or interest on its outstanding bonds or lease payments securing bonds of other government agencies;(iii) any other payments necessary to protect the health and safety of the citizens of the city.(2) If the Secretary of the Budget shall make such determination with regard to a city, he shall notify the chief financial officer of the city of his determination, and, subject to the provisions of subsection (d), the city shall be prohibited from discharging any unpaid, identifiable minimum obligation to fund the pension plan of the city for the fiscal year of the city beginning July 1, 1990, and ending June 30, 1991, other than any such payment which has been ordered to be paid by a court of competent jurisdiction prior to the effective date of this act, unless:(i) the city and the trustees of the pension fund have reached agreement that the payment due to the pension fund for such fiscal year shall be discharged by the city paying at least 10% of the amount owed by the first of each month commencing July 1, 1991, until the total amount due has been paid in accordance with such payment schedule; or(ii) until payment has been made upon the occurrence of the earliest of:(A) the authority either having issued bonds or secured credit for such city and the city is in receipt of the proceeds thereof which are permitted to be used and are sufficient to make pension payments;(B) the city has issued and received the proceeds of tax anticipation notes as authorized by the General Assembly; or(d)Deferral.--Whatever minimum obligation to fund the pension plan of a city for the fiscal year of a city beginning July 1, 1990, and ending June 30, 1991, remains unpaid as of June 30, 1991, shall not constitute a failure or potential failure to comply with the city's applicable funding standard requirements in accordance with the act of December 18, 1984 (P.L. 1005, No. 205), known as the Municipal Pension Plan Funding Standard and Recovery Act, and no cause of action in mandamus or otherwise shall arise by virtue of the city's failure to pay its minimum obligation within said fiscal year, provided that:(i) the city complies with the provisions of the agreement with the trustees of the pension fund or with the other provisions of subsection (c); and(ii) the city pays interest on any amount of its minimum obligation which remains unpaid as of June 30, 1991, which amount shall be added to the minimum obligation of the city for the fiscal year beginning July 1, 1991, with interest from July 1, 1990, on any amount remaining unpaid at a rate equal to the interest assumption used for the actuarial valuation report or the discount rate applicable to treasury bills issued by the Department of Treasury of the United States with a six-month maturity as of the last business day in June 1991, whichever is greater, plus an additional 2% interest, expressed as a monthly rate and compounded monthly.(e)Waiver of pension review study requirements.--The provisions of section 7 of the act of July 9, 1981 (P.L. 208, No. 66), known as the Public Employee Retirement Study Commission Act, are hereby waived and shall not apply to this act.(f)Definitions.--Unless the context clearly indicates otherwise, the definitions provided for in the act of December 18, 1984 (P.L. 1005, No. 205), known as the Municipal Pension Plan Funding Standard and Recovery Act, shall apply to this section. 1991, June 5, P.L. 9, No. 6, § 705, imd. effective.