On this week’s Radio PA Roundtable, House and Senate Republican leaders in Harrisburg announce plans for votes on Governor Tom Wolf’s tax plans and the governor responds with a pitch to rank-and-file lawmakers. Also, the governor talks about the latest troubles for embattled Attorney General Kathleen Kane and meeting Pope Francis.
Click the audio player below to hear the full broadcast:
On this week’s Radio PA Roundtable, Senate Majority Leader Jake Corman announces plans to introduce a major public pension overhaul in Pennsylvania and the Secretary of the state Department of Drug & Alcohol Programs has a confirmation hearing as part of his re-nomination process.
Click the audio player below to hear the full broadcast:
On this week’s Radio PA Roundtable, more from Governor Tom Wolf in his first “Ask the Governor” appearance; why couldn’t Republicans do more when they ran the show in Harrisburg from 2011-2015? And how trade and technical schools are carving out an important role in education.
Click the audio player below to hear the full broadcast:
On this week’s Radio PA Roundtable, an exclusive one-on-one interview with PA Senate Majority Leader Jake Corman (R-Centre) covering topics that include the budget talks, pension reform and his role in suing the NCAA over the Penn State sanctions.
Click the audio player below to hear the full broadcast:
Regardless of any additional reforms, executives from the state’s two big public pension funds are telling state lawmakers that adequate employer contributions are essential. In this case, the state is the employer and its taxpayers are the ones footing the bill.
As it stands, the combined unfunded liabilities of the State Employees’ Retirement System (SERS) and Public School Employees Retirement System (PSERS) are north of $40-billion dollars and climbing. The reasons are many: the 2008 market crash, a lost decade in which the state opted to defer its pension contributions, and a 2001 law that padded pension benefits – especially for lawmakers themselves.
Governor Tom Corbett is proposing a series of long-term pension reforms in hopes of reducing the short-term burden on the state, and PSERS executive director Jeffrey Clay was peppered with questions during House and Senate budget hearings on Wednesday.
“If you’re basically asking the question, “can we get to solvency under Act 120?” the answer would be – from the pension system perspective – yes. The question is whether the state and the school districts can actually afford that,” Clay explains.
Act 120 of 2010 helped to smooth out the pension spike by reducing the benefits of future state employees and teachers, increasing the retirement age and extending the vesting period. Even with those reforms being imposed for all new hires, the state’s $1.5-billion dollar pension obligation this year is expected to climb to $4.3-billion by FY2016/17.
State Sen. Jake Corman
“The policy question for all of us sitting here is, “what are we willing to pay every year?”” said Senate Appropriations Chairman Jake Corman. As lawmakers are finding out, that’s a question without an easy answer.
When addressing the issue of switching new hires to a 401(k)-style ‘defined contribution’ plan, the funds’ executives say any system will work as long as it is well-structured and well-funded.
But critics say that sort of switchover ignores the diminished rate of return for the defined-benefit plans that would still be paying out benefits for decades to come. “Policymakers should ask the Corbett administration how much will be lost in investment earnings with pension restructuring and how much taxpayers will be on the hook when that happens,” says Keystone Research Center executive director Stephen Herzenberg.
The Corbett administration is banking on $175-million dollars in savings for the state, next year alone, through pension reforms. They say PA’s 500 school districts would be able to save another $138-million.
When Penn State was ordered to pay a $60 million fine among the NCAA sanctions announced last summer, 25% of that money was designated to be spent on programs within the state. That wasn’t good enough for Pennsylvania Senator Jake Corman, who filed a lawsuit demanding that all of the money go to child abuse prevention programs and educational organizations in the Keystone State.
That lawsuit has yet to be resolved, but in the meantime, Corman’s office has announced that the NCAA has agreed not to “disperse or otherwise dissipate” any of the $12 million paid so far by the university. It’s part of a preliminary injunction filed by Corman, who believes all of the fine money should stay in-state.
In a separate lawsuit, Governor Tom Corbett is seeking to overturn all of the NCAA sanctions handed down to Penn State.
Senate Republicans unveiled the latest version of the FY2012 state budget late Monday during a Senate Appropriations Committee meeting in Harrisburg. The measure passed 16-10 along party lines. The $27.148 billion spending plan also has the approval of Governor Tom Corbett and House Republicans, who signed off on it during closed-door budget talks.
The budget restores hundreds of millions of dollars in education spending cuts, but Democrats say it’s not enough. Democratic members of the Senate Appropriations Committee tried unsuccessfully to restore or increase funding to several line items through amendments that attempted to bolster human services, AIDS funding, the now-defunct AdultBasic health plan, the arts and tourism, among others. Each amendment failed by the same 16-10 party line vote.
Senate Appropriations Chairman Jake Corman (R-Centre) says this budget proposal spends responsibly while respecting the billions of dollars in debt the Commonwealth is now carrying.
The budget bill is expected to go to the full Senate today.