State Inspector General Legislation Sent to Governor

 

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HARRISBURG – Legislation that would statutorily create the State Office of Inspector General and give Pennsylvania’s top fraud, waste and abuse investigator more power and authority has been finally passed by the General Assembly and now has been sent to the Governor.

Senate Bill 527, authored by Senator Ryan Aument (R-36) and Mindy Fee (R-37), codifies the Office of Inspector General, which currently exists only by Gubernatorial Executive Order.

“My goal has always been to make sure we are doing all we can to catch people who cheat government,” said Aument.  “This legislation – which is 30 years in the making – will help us achieve that important goal.”

In addition to creating the office by law, the legislation achieves two other primary objectives.

First, since the Inspector General’s Office will exist by law, it can be given more power and authority to succeed.  Under the legislation, the Inspector General will now have subpoena powers and limited law enforcement authority, something the office currently does not have.

Second, the legislation was built on and includes national best practices for the operations of an Inspector General’s Office and the selection of who holds the Inspector General’s post.

“I am proud to enhance and promote the good work of our Inspector General,” said Fee.  “Under this bill, Pennsylvania’s Inspector General will be able to do his work in a manner that is fitting for an investigator – free of direct undue influence.”

The legislation includes many provisions which promote independence.

For example, for the first time, there will be enumerated qualifications which an Inspector General must meet in order to be appointed. 

An Inspector General cannot be hired based on political affiliation, must be a person of integrity, have a capability for strong leadership and demonstrated ability in accounting, auditing, financial analysis, law, management analysis, public administration, investigation or criminal justice administration or other appropriate fields.

An Inspector General cannot seek elective office during their term, and just as importantly, cannot be dismissed from their job without a substantive reason, including for cause.

The legislation also gives the Inspector General his own line-item in the state budget and places those monies under his jurisdiction, an important component of making sure his budget is not interfered with by other state government leaders.

“When Senator Aument and I drafted this legislation, we worked to not just empower Pennsylvania’s Inspector General, but to create an atmosphere where everyone can have full confidence in his work,” said Fee.

Another key component of this legislation is that it begins a new – and regular – conversation between the Inspector General and the General Assembly.

Senate Bill 527 requires that the Inspector General directly engage the members of the House and Senate by submitting an annual report that details the work of the office, the monetary value of fraud prevention, and the actual recovery of monies from cheaters.  It also invites the Inspector General to tell lawmakers if there are problems in state government that need to be addressed in laws, such as loopholes or other issues.

The legislation was first introduced by Aument and Fee during the 2015-16 legislative session, however it was vetoed by Governor Wolf, who cited concerns with how the legislation created the Inspector General’s Office.

“One of the things I am most proud of,” said Aument, “is that we were able to work with the Governor and both Republicans and Democrats to craft a proposal that I believe will make a meaningful difference for Pennsylvania.”

Rep. Fee echoed Aument’s comments. 

“To me, this legislation represents what people expect of their lawmakers – to actively work to enact meaningful reform in how we structure state government, to promote accountability in how we value scarce taxpayer money, and to find ways to pass quality legislation despite differences,” she said.

CONTACT: Jake Smeltz (717) 787-4420 

EDITORIAL NOTE: 

The Pennsylvania Office of Inspector General (OIG) was first established by Executive Order in 1979 within the Pennsylvania Department of Transportation. To further protect the state’s interest, Executive Order 1987-7 was issued to create a statewide OIG within the Executive Office of the Governor, possessing authority which encompasses all executive agencies.

The OIG is primarily responsible for investigating fraud, waste, abuse, and misconduct in executive agencies. To meet this duty, the OIG maintains staff in the Harrisburg headquarters office, as well as in regional offices in Pittsburgh and Philadelphia. Investigative reports are submitted to agency heads and the Governor’s Office of General Counsel, recommending appropriate corrective action, including employee discipline, sanctions or remedial actions for contractors, and improved policies for agencies. When applicable, the OIG recommends cases for referral by the Office of General Counsel to an appropriate agency for criminal prosecution, or to the State Ethics Commission for ethics violations. The OIG also assists federal, state, and local law enforcement agencies that investigate and prosecute fraud against the Commonwealth. Additionally, the OIG conducts investigations regarding independent state agencies upon the request and cooperation of the agency.

Since 1994, the OIG is also responsible for investigating and prosecuting welfare fraud and for conducting collection activities for public assistance programs administered by the Department of Human Services (DHS). The OIG employees who perform welfare fraud detection and prevention initiatives and collection activities have a statewide presence. The OIG is headquartered in Harrisburg and operates regional offices in Pittsburgh, Philadelphia, and Wilkes-Barre. Partnering with DHS, the OIG works to ensure that those who rightfully deserve benefits receive them. When appropriate, the OIG works with local district attorneys to prosecute those who received benefits fraudulently. These initiatives are designed to maintain the integrity of the public assistance programs.

Senate Budget Plan Holds Line on Spending, Boosts Support for Schools

The State Senate today approved a spending plan for fiscal year 2017-18 that holds the line on spending, increases funding for education and funds core responsibilities of state government, according to Senate Republican Leaders.

Despite massive increases in mandated expenses – including pensions, health care and human services – the overall increase in spending in the proposed budget is just 0.2 percent over the current year, and well below the rate of inflation.

 The spending total of $31.996 billion is nearly $650 million less than Governor Wolf’s original budget request and adheres to the approach demanded by taxpayers by controlling state government spending and cutting through expensive layers of bureaucracy.

Along with the fiscally responsible approach to the budget, the spending plan meets the core responsibilities of government and funds key priorities – maintaining a quality education system, promoting job growth and addressing some of the most serious challenges facing Pennsylvania communities.

Senate Republican leaders offered the following statements on House Bill 218, which now goes to the House for consideration:

Senate President Pro Tempore Joe Scarnati (R-25): “This year’s budget required many difficult decisions to be made.  While the reality of our fiscal situation makes some spending reductions necessary, we were able to restore a portion of funding to budget lines that are important for all Pennsylvanians.  Our goal continues to be protecting taxpayers from broad-based tax increases that have been detrimental to Pennsylvania in the past.”

 

 

Senate Majority Leader Jake Corman (R-34): “The budget adhere to what has been demanded by taxpayers – controlling state government spending while still providing historic education funding and money for other priorities. By putting taxpayers first, we have held the spending increase to less than 1 percent. We have done this in the face of significant fiscal challenges and growth in mandated spending. We look forward to continuing the talks to achieve a revenue package that moves toward bringing more fiscal stability to state government.” Listen

 

Senate Appropriations Committee Chair Pat Browne (R-16): “In recognizing the financial challenges the Commonwealth continues to face, this budget provides a fiscally-responsible spending plan with a modest increase in funding for vital state programs and services, while still protecting hard working individuals and job creators from onerous tax increases.  This budget also continues the state’s dedication to providing a quality education for all Pennsylvania students as it increases funding for basic education, special education, early childhood education and early intervention to unprecedented levels.”  Listen

 

CONTACTS:
Kate Eckhart – Senator Scarnati (717) 787-7084
Jenn Kocher – Senator Corman (717) 787-1377
Matt Moyer – Senator Browne  (717) 787-1349

SB 8 (Asset Forfeiture Reform) Signed into Law as Act 13

(Harrisburg) – Today, Senator Mike Folmer (R-48) and Senator Joe Scarnati’s (R-25) Senate Bill 8, to reform Pennsylvania’s Asset Forfeiture Law, was signed into law as Act 13 of 2017.

“Act 13 represents over two years of work by many different groups, and makes significant asset forfeiture reforms as the status quo didn’t provide adequate protections for property owners,” Senator Folmer said.  “This is a step towards smarter forfeiture practices to provide various protections to property owners.”  

Key Reforms in SB 8 Include: 

  • Higher burdens of proof imposed on the Commonwealth.
  • Protections for third party owners by placing additional burdens of proof on the Commonwealth.
  • Improved transparency in auditing and reporting at both the county and state levels.
  • Specific and additional protection in real property cases by prohibiting the pre-forfeiture seizure of real property without a hearing.
  • Additional procedural protections for property owners, such as returning property to the forfeiture proceeding if there is undue hardship, and an extra level of protection for anyone acquitted of a related crime who is trying to get their property back.

Senate Approves Bipartisan Clean Slate Legislation

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HARRISBURG – The Senate today unanimously approved bipartisan legislation sponsored by Senator Scott Wagner (R-York) and Senator Anthony Williams (D-Philadelphia/Delaware) to provide for automatic sealing of criminal records for minor offenses.

Senate Bill 529  would allow for the automatic sealing of low level, non-violent criminal offenses, eliminating the need for individuals to petition the court. This “clean slate” measure and a companion bill, House Bill 1419, are the first of their kind in the nation.

“More than one-third of the Commonwealth’s working-age citizens are estimated to have criminal records. Many have only minor offenses, such as misdemeanors, while others simply have arrests without conviction,” said Wagner. “As a business owner, I understand how this can be a barrier to employment and a better life. Removing that barrier will allow more Pennsylvanians to live as productive citizens.”

Under the legislation, misdemeanors would be sealed after 10 years of the individual being crime-free and as long as court obligations have been met. Non-convictions would be sealed after 60 days and fulfillment of court obligations.

It also exempts individuals with a sealed record from having to disclose criminal history records. This is often a huge hurdle for individuals attempting to obtain a job or housing.

The bills applies only to non-violent misdemeanors. Offenses that do NOT qualify under Clean Slate include:

  • Offenses involving danger to the person
  • Offenses against the family
  • Offenses relating to firearms and other dangerous articles
  • Offenses relating to registration of sexual offenders
  • A violation relating to indecent exposure
  • A violation relating to failure to comply with registration requirements
  • A violation relating to weapons or implements for escape
  • A violation relating to cruelty to animals; or
  • A violation relating to corruption of minors.

“In our fight for criminal justice reform, we’ve taken a great stride toward restoring the full benefit of citizenship to individuals with criminal backgrounds,” Williams said. “The ability to work and make meaningful contributions to society is at the core of our democracy. This bill will help millions do just that.”

Senate Bill 529 now goes to the House of Representatives for consideration.

Bipartisan Clean Slate Legislation Nears Senate Vote

HARRISBURG — Bipartisan legislation sponsored by Senator Scott Wagner (R-York) and Senator Anthony Williams (D-Philadelphia/Delaware) that would provide for automatic sealing of criminal records for minor offenses received the unanimous support of the Senate Appropriations Committee.

Senate Bill 529 would eliminate the hurdle that individuals with a criminal record face when seeking opportunities, particularly for employment.  Senate Bill 529 and a companion measure, House Bill 1419, are the first “Clean Slate” bills of their kind in the nation. 

“Senate Bill 529 would allow for the automatic sealing of low level, non-violent criminal offenses, eliminating the need for individuals to petition the court,” Wagner said. “This legislation will create new opportunities for men and women across the Commonwealth who have dealt with barriers due to minor criminal records, providing a ‘Clean Slate’ going forward.”

Under the legislation, misdemeanors would be sealed after 10 years of the individual being crime-free and as long as court obligations have been met. Non-convictions would be sealed after 60 days and fulfillment of court obligations.

It also exempts individuals from having to disclose sealed criminal records, a current hurdle for individuals attempting to obtain a job or housing.

“A bedrock of the criminal justice system is that individuals serve time and reintegrate themselves into society,” said Williams. “Successful reintegration requires access to opportunity. This bill gets us closer to that goal.”

Senate Bill 529 now goes to the full Senate for consideration.

 

CONTACT: Erin Marsicano, 717-787-3817, emarsicano@pasen.gov

 

Bipartisan policy forum to focus on reform, elimination of school property taxes

HARRISBURG – Two key state Senate committees will host a forum on Thursday to dive deeper into proposals to eliminate and reform school property taxes in Pennsylvania.

The Senate Majority Policy and Democratic Policy Committees will hear testimony from various groups with a vested interest in school property tax elimination and reform during the first in a series of public forums regarding the property tax problem.

Senate Majority Policy Committee Chairman David G. Argall (R-Schuylkill/Berks) says the issue is too critical to ignore any longer.

“As one of the many sponsors of a measure to eliminate school property taxes, I think it’s important to hear ways to advance this issue of much-needed relief for homeowners across this state,” Argall said. “I look forward to a robust discussion with various stakeholders as to how we move forward as requested by so many taxpayers across the state.”

Sen. Lisa Boscola (D-Northampton/Lehigh) added, “As a co-sponsor of Senate Bill 76 and an advocate who has fought to eliminate property taxes throughout her career, I am encouraged by this bipartisan approach. Pennsylvania’s seniors, working families and all homeowners expect and deserve decisive action this session.”

Senator Mario Scavello (R-Monroe/Northampton), who is hosting the event, said the issue of local tax reform is a top priority for local residents.

“I am very pleased to have the Senate Policy Committees come to the 40th Senate District to discuss school property tax reform, the single most important issue affecting my constituents,” Scavello said. “This forum is a vital step in continuing to build momentum to end our reliance on the burdensome school property tax that makes it difficult for seniors and families alike to stay in their homes and often makes our citizens choose between critical expenses and paying the property tax.”    

The forum will feature a presentation by the Pennsylvania Coalition of Taxpayer Associations, the statewide grassroots organization comprised of volunteers who drafted Senate Bill 76, which would eliminate school property taxes by shifting to an increased Personal Income Tax and increased and expanded Sales and Use Tax. Also invited are the Pennsylvania Chamber of Business and Industry, the Pennsylvania School Boards Association, the Pennsylvania School Business Officials, the Pennsylvania Association of Realtors and the Pennsylvania Farm Bureau.

Other proposals that will be discussed include: school property tax freeze for senior citizens, a Constitutional amendment to allow for the total elimination of school property taxes for homeowners only, local options for school districts to either reduce or eliminate school property taxes, as well as property tax reassessment reform.

The forum will take place at the Pocono Mountain East High School Auditorium, 231 Pocono Mountain School Road, Swiftwater, PA 18370 on Thursday, June 22 at 6:30 p.m. The public is invited to attend and there will be a period for questions from local residents.

Op-ed: Pension Reform Stops the Bleeding in State, School District Budgets

Due to Pennsylvania’s public employee pension crisis, the state budget has been hemorrhaging money for nearly a decade. Over the past several weeks, lawmakers and Governor Wolf took an important step to stop the bleeding by creating a new system of retirement benefits for school and state employees that makes sense in today’s economy, and for today’s workforce.

Rising pension costs have put an extreme amount of pressure on school districts and state budgets, resulting in higher property taxes and less money for worthwhile programs. The scope of this problem is staggering.

Unfunded liabilities in the state’s two largest public pension systems now total more than $60 billion. For the sake of comparison, that is almost double the amount of state taxpayer dollars required to fund the entire state budget. SERS and PSERS employer contributions have skyrocketed from $1 billion in Fiscal Year 2010-11 to more than $6 billion for Fiscal Year 2017-18.

The bipartisan pension reform measure that was signed into law this week creates an updated retirement system for newly hired employees that mirrors the benefits offered by most employers in the private sector. Perhaps more importantly, it removes a large portion of the risk endured by taxpayers during an economic downturn. It is estimated the bill will save at least $5 billion, but that total could quickly climb to $20 billion or more if state retirement investments continue to fail to reach projections.

While a high priority has been placed on protecting taxpayers, the plan also is sensitive to the needs of public-sector employees. Our economy is changing, and it is now rare to see employees spending 20, 30 or even 40 years in the same job. The new system will ensure employees can explore different career options without jeopardizing a comfortable retirement. In fact, the new state retirement benefit provides better security in retirement than most in the private sector.

The final product of our concerted pension reform efforts is a plan that accomplishes more than any other state in the nation – a monumental improvement that could serve as a national model for other states struggling with pension costs.

Too often in Harrisburg and in Washington, lawmakers look to fix the problems of today without looking to what might happen tomorrow. The modernization of Pennsylvania’s pension systems bucks this trend and sets our commonwealth on a more sustainable path for the future.

CONTACT: Heather Cevasco (215) 489-5000

Senate Passes Aument Measure to Promote Independence of Office of Inspector General

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HARRISBURG — The Office of Inspector General would have greater authority and independence to investigate and eliminate waste, fraud and abuse of tax dollars under legislation approved by the Senate with strong bipartisan support today.

Senate Bill 527, sponsored by Senator Ryan Aument (R-36), would establish the Office of Inspector General in statute. The office currently operates under Executive Order and could be eliminated at any time. Aument’s bill would broaden the office’s authority to bring criminal charges, issue subpoenas and investigate and eliminate fraud in human services programs.

“Too often, lawmakers spend too much time talking about how to spend money instead of discussing ways to save money,” Aument said. “The Inspector General is one of the first lines of defense in preventing our tax dollars from being wasted and abused. Ensuring this office can continue to operate without any undue influence is the best way to make certain our tax dollars are used wisely and that state government is operated in an appropriate manner.”

Similar legislation was approved by the General Assembly last year, but Governor Wolf vetoed the measure.

In response to the veto, Aument worked with stakeholders to address most of Governor Wolf’s concerns regarding the bill. The Senate State Government Committee also held a hearing earlier this year to gather input on how the bill could be improved and approved an amendment that included both Republican and Democrat ideas.

Several measures were stripped from the prior version of the bill, including a requirement for the Senate to confirm the governor’s nomination of the Inspector General. Instead, Senate Bill 527 now includes various components that promote the independence of the Inspector General’s Office.

For example, the Inspector General could not seek elected office during their tenure and would have to meet minimum qualification standards.  Additionally, the legislation gives the Inspector General’s Office its own line-item appropriation and provides that the Inspector General may be removed by the governor for cause. 

The Office of Inspector General would also be required to report to the General Assembly each year with information regarding investigations conducted and money saved and recovered by the office, providing valuable feedback to lawmakers on government programs and operations.

“I am proud to support an idea originally offered by Democrat Governor Bob Casey,” said Aument, referring to the Executive Order originally authored in 1987.  “I am hopeful that with the compromises offered today in response to the Governor’s veto, we can move forward in a manner that promotes something everyone agrees with – that cheaters should never win.”

Representative Mindy Fee has authored identical legislation in the House of Representatives, House Bill 896.

Senate Bill 527 passed by a 37-12 margin. The measure was sent to the House of Representatives for consideration.

 

VIDEO: https://pasen.wistia.com/medias/ta8n5ng9ap

 

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CONTACT: Jake Smeltz (717) 787-4420

 

Senate Approves DiSanto Bill to Prohibit Costly Regulations without Legislative Approval

Harrisburg – Legislation sponsored by State Senator John DiSanto (R-15) to prohibit costly government regulations from being imposed without approval by the General Assembly and Governor was approved by the Senate today.

Under Senate Bill 561, no regulation with an economic impact or cost to the Commonwealth, to its political subdivisions, and to the private sector exceeding $1 million could be imposed without approval of the General Assembly and Governor. This change would help protect businesses, non-profits, educational institutions and individuals from costly, burdensome regulations.

Currently, the regulatory review process requires the General Assembly to pass a concurrent resolution disapproving a regulation. However, the Governor must sign the disapproval resolution to bar his own agencies from enacting the regulation, a highly unlikely scenario, the senator noted.

“Our current regulatory process vests too much power in unelected government employees and agencies that lack direct accountability to the people. This legislation will help restore the constitutional balance and lift a regulatory burden that is hampering job creation and economic growth,” DiSanto said.

Senate Bill 561 will now be sent to the House of Representatives for consideration.

CONTACT: Chuck Erdman cerdman@pasen.gov (717) 787-6801

Op-Ed: State’s New Pension Law Strikes Right Balance for Reform

An Op-Ed By Senators Jake Corman, Majority Leader, and Pat Browne, Appropriations Committee Chairman

The Commonwealth faces a number of significant challenges, but none are as serious as the public employee pension crisis. Pension liabilities have reached a staggering $80 billion and continue to grow with each passing day.

The effects of this crisis have been felt for nearly a decade. Lawmakers have faced massive budget deficits nearly every year since 2008. These fiscal difficulties have prevented us from investing in tax cuts for hardworking families or contributing more money to areas of state government that could benefit from additional funding, including education.

Money that otherwise could have been used in the classroom has been consistently diverted to meet rising pension obligations. The proposed 2017-18 state budget includes $100 million in new money toward education; the increase in the pension payment for school districts is $144 million. The state’s contributions to school district pensions increased from $290 million to a whopping $2.1 billion in the last decade – a 618 percent increase.

The road to addressing this problem has been long and difficult. However, the General Assembly finally took historic action last week to restructure the state’s two public employee pension systems. The resulting legislation is the most comprehensive transfer of risk away from taxpayers in the country.

With the Governor signing Act 5 of 2017 into law, we have transformed state employee and teacher pensions to reflect today’s workforce with a 401(k)-style plan that provides employees with options and portability.

According to an analysis by the Pew Charitable Trust, Act 5 helps “ensure the Commonwealth’s retirement system is sustainable and secure for both taxpayers and public workers for decades to come” and called the enactment of this legislation “the most comprehensive and impactful reform any state has implemented.”

Under the new plan, new employees and lawmakers will choose between three retirement options, including a full 401(k)-style plan or one of two side-by-side hybrid plans that include both a traditional pension and a 401(k)-style option. Current employees will have the opportunity to opt into one of these plans as well, if they so choose. Lawmakers are treated just like every other employee – new lawmakers will be placed into the new plan; current lawmakers will have to choose to opt in. Current retirees will see no changes to their benefit.

The plan also includes the vital component of portability, ensuring that employees can take their benefits with them if they choose a different career path. More than 75 percent of teachers and more than half of state employees leave their job before they reach 20 years of service. These employees would fare better under the new system.

This legislative action is significant not only for how it restructures the retirement system for state employees and teachers, but for how it approaches the problem. Instead of simply dealing with the challenges of the day, this approach instead looks toward the future.

Outside analysis suggests that the plan could shield taxpayers from billions in future costs if investment returns by the pensions systems continue to fail to meet projections. An analysis of both systems shows that if those projections are missed by 1 percent, taxpayers will realize a savings of $27 billion when the new plan is fully in place. At the same time, employees share in the benefit if the returns exceed expectations.

Independent analysis estimates that the restructured pension system will shave more than $5 billion off of the pension debt with an additional savings of up to $3 billion is projected in terms of reduced costs and fees for investment management.

Groups from across the political spectrum such as the Pennsylvania Chamber of Business and Industry, the Commonwealth Foundation and the Pennsylvania Institute of Certified Public Accounts have all acknowledged the importance of this law. The Pennsylvania School Boards Association said the plan provides the “stability our school districts have been calling for and need.”

For many years, there appeared to be no end in sight to the problems plaguing Pennsylvania’s pension systems. With this much-needed modernization of Pennsylvania’s pension systems, we have finally arrived at a solution that strikes the proper balance between the interests of taxpayers and the need to provide competitive retirement benefits for employees.

Senator Jake Corman is the Majority Leader of the Pennsylvania Senate (@JakeCorman or jcorman@pasen.gov). Senator Pat Browne is Chairman of the Pennsylvania Senate Appropriations Committee (@SenatorBrowne or pbrowne@pasen.gov).