A proposal to divert newly hired public school and state government employees into a Pennsylvania retirement system that combines a traditional pension benefit with a 401(k)-style account is showing signs of life.
The House State Government Committee on Tuesday voted along party lines for a Republican proposal designed to save the state about $10 billion over 30 years and help insulate taxpayers from the ups and downs of the stock market.
The bill would count employee income of up to $50,000 toward a traditional pension benefit for 25 years. They’d still be able to save for retirement in a 401(k)-style defined contribution plan after reaching those benchmarks.
State policy makers are looking at options to deal with more than $50 billion in pension debt.