Notice

Police and Firefighter Ad Hoc Cost of Living Adjustment

Act 21 of 2026 was signed into law by Governor Josh Shapiro as part of the Commonwealth Budget in July 2026. The Act provides a Cost-of-Living Adjustment (COLA) for retired municipal police officers and paid firefighters.

All retired municipal police officers and paid firefighters who began receiving benefits on or before December 31, 2020, are eligible to receive the COLA. A municipal retirement system must begin paying the COLA with the first retirement benefit payment made on or after August 1, 2026.

COLA increase per month are as follows:

$75:  Retiree has been retired 5 to 10 years as of 1/1/2026 (1/1/2016 – 12/31/2020)

$150: Retiree has been retired 10 to 20 years as of 1/1/2026 (1/1/2006 – 12/31/2015)

$300: Retiree has been retired 20+ years as of 1/1/2026 (on or before 12/31/2005)

Please note there is a 65% reduction on COLA benefits if the member received post-retirement increases between December 31, 2001 – January 1, 2026.

Act 21 provides a reimbursement procedure for the COLA through the Auditor General. By April 1 of each year, a municipality shall certify to the Auditor General the annual amortization cost for the prior year attributable to the COLA. The Auditor General will reimburse eligible applicants. 

For more information on the Act 21 COLA, please ask your pension administrator or actuary.