“SB 1 is a historic plan that reflects the seriousness of the situation we face with pensions. It is the most responsible approach for the people of Pennsylvania and will be the most significant public policy achievement of our time.”
Senate Majority Leader Jake Corman (R-Centre) on Senate Republican pension reform legislation poised for action in the Senate.
Comprehensive Pension Reform Plan to be Considered
The Senate is expected to consider legislation this week to reform Pennsylvania’s costly state pension systems, which are causing increases in school taxes and cuts to school programs, and now threaten to increase state taxes.
Senate Bill 1, sponsored by Senate Majority Leader Jake Corman (R-Centre), restructures the state’s two public employee pension systems – the State Employees’ Retirement System and the Public School Employees’ Retirement System — in order to make them viable in the long term.
Senate Bill 1 provides choices to current and future employees to create a pension plan that they tailor to suit their needs. Most importantly, it gets the taxpayers out of the pension risk business. For more on Senate Bill 1, please see In the Spotlight and Fast Facts.
Watch – Senator Corman Floor Remarks
Watch – Senator Corman Floor Remarks (Follow-up)
Senate Reconvenes at 11 a.m.
The Senate reconvenes today at 11 a.m. Bills on the calendar that may run this week include:
The Senate Labor and Industry Committee, chaired by Sen. Lisa Baker (R-Luzerne), meets to consider the nomination of Kathy Manderino as Secretary of Labor and Industry. (Tues., 10 a.m., Room 461) *Not Streamed Live
The Senate Public Health and Welfare Committee, chaired by Sen. Pat Vance (R-Cumberland), meets to consider the nomination of Dr. Karen Murphy as Secretary of Health. (Tues., 10 a.m., Maj. Caucus Room)
The Senate Aging and Youth Committee, chaired by Sen. Michele Brooks (R-Mercer), meets to consider the nomination of Teresa Osborne as Secretary of Aging. (Tues., 11:15 a.m., Room 461) *Not Streamed Live
The Senate State Government Committee, chaired by Sen. Mike Folmer (R-Lebanon), meets to consider the nomination of Pedro Cortes as Secretary of the Department of State. (Tues., 11:30 a.m., Maj. Caucus Room)
The Senate Game and Fisheries Committee, chaired by Sen. Mario Scavello (R-Monroe), meets to receive the 2014 Annual Report from the Pennsylvania Fish and Boat Commission. (Tues., 11:30 a.m., Room 8E-B)
The Senate Agriculture and Rural Affairs Committee, chaired by Sen. Elder Vogel (R-Beaver), meets to consider the nomination of Russell Redding as Secretary of Agriculture. (Tues., 12 p.m., Room 8E-A)
The Senate Environmental Resources and Energy Committee, chaired by Sen. Gene Yaw (R-Lycoming), meets to consider the nomination of Cindy Dunn as Department of Conservation and Natural Resources Secretary. (Wed. 9 a.m., Room 461) * Not Streamed Live
The Senate Agriculture and Rural Affairs Committee, chaired by Sen. Elder Vogel (R-Beaver), holds a joint public hearing with the House Agriculture and Rural Affairs committee on industrial hemp, Senate Bill 50 and House Bill 967. (Wed., 9:30 a.m., Maj. Caucus Room)
The Senate Banking and Insurance Committee, chaired by Sen. Don White (R-Indiana) meets to consider the nomination of Robin Wiessmann as Secretary of Banking and Securities, and holds a public hearing on competitiveness of the banking industry in Pennsylvania. (Wed., 9:30 a.m., N. Office Bldg. Room 1)
The Senate Veterans Affairs and Emergency Preparedness Committee, chaired by Sen. Randy Vulakovich (R-Allegheny), holds a public hearing on E-911. (Wed., 1:30 p.m., N. Office Bldg. Room 1)
Hearings are streamed live at PASenateGOP.com unless noted.
Senate Acts to Open Up Government Contract Negotiations, Advertising Spending
Continuing efforts to increase accountability and transparency of state and local government entities, the Senate approved measures on Wednesday that will require advertising to be identified when it is paid for by tax dollars and to give the public greater access to contract negotiations involving government and public employees.
Senate Bill 442, sponsored by Sen. Mike Folmer (R-Lebanon), requires all Commonwealth agencies under the executive, legislative and judicial branches to clearly note whenever tax monies are spent for advertising purposes. The bill would require all ads on radio, television, newspapers, magazines, billboards and through other media to include the statement “Paid for with Pennsylvania taxpayer dollars.”
Two bills approved by the Senate will add transparency to negotiations between public sector unions and state and local governments.
Senate Bill 644, sponsored by Sen. Mike Folmer (R-Lebanon), requires the Independent Fiscal Office to complete a cost analysis of proposed collective bargaining agreements under the Governor’s jurisdiction prior to the execution of those contracts.
Under this measure, the Governor would be required to give the IFO two weeks’ notice of pending contracts so the agency could determine the costs to cover public employee wages, benefits, pensions, and working conditions under the proposed agreement. This will ensure that the public knows how the full costs of these labor agreements would impact the Commonwealth. It is also vital information that we in the General Assembly need to develop a balanced state budget.
Senate Bill 645, sponsored by Sen. Pat Stefano (R-Fayette), requires any proposed state or local collective bargaining agreement be made available on the public employers’ publicly accessible Internet website within 48 hours. An agreement must be posted online two weeks prior and thirty days following the signing of the collective bargaining agreement.
Taxpayers have a vested interest in the labor negotiations between public employers and their employees and deserve the right to review contract agreements. Requiring an online posting of the proposed collective bargaining agreements is a straightforward reform to advance government transparency and ensure taxpayer money is spent effectively
The bills now go to the House of Representatives for consideration.
Senate Approves Bill to Help Municipalities Fight Blight
The Senate approved legislation Tuesday to give municipalities the ability to address dilapidated properties sooner than they now can.
Currently, municipalities must issue citations four times for the same building code violation before a criminal offense of failure to comply may be charged against a neglectful property owner. Among other changes, Senate Bill 330, sponsored by Sen. Kim Ward (R-Westmoreland), allows the criminal offense to be charged when the number of code violations is two or more of the same subsection under the municipal housing code.
Senate Bill 330 was sent to the House of Representatives for consideration.
Mensch Bill to Remove Unnecessary Projects from LBFC Passes Senate
Legislation sponsored by Sen. Bob Mensch (R-Montgomery), Senate Bill 622, which removes unnecessary, recurring projects from the Legislative Budget and Finance Committee (LBFC), unanimously passed the Senate on Tuesday and heads to the House of Representatives for consideration.
Removing unnecessary and outdated recurring projects will enable LBFC to allow personnel to work on new studies.
The LBFC, chaired by Senator Mensch, is a bicameral bipartisan legislative service agency responsible for conducting studies and making recommendations aimed at eliminating unnecessary expenditures. The LBFC is authorized to conduct a wide range of research activities related to the operation and performance of state-funded programs and agencies.
In the Spotlight
This year Pennsylvania faces a $1 billion increase in pension obligations – the general fund must increase by about $723 million; school districts an additional $271 million.
Money that could be used to instruct students is being eaten up by pension payments caused by betting on Wall Street during previous attempts to overhaul the system. The growth of the mandated spending is beyond our means.
The Senate pension proposal will tackle modernizing the pension system through updates to funding, sustainability and fiscal responsibility. Under this plan, if the pension system does well, the employees will reap the benefits. Currently, if the system does well, the employees still receive a stagnant benefit.
The bill modernizes the system to reflect current realities and demographics of our workforce. About 88 percent of the workforce in Pennsylvania have 401(k)-style plans. They are private sector employees whose taxes go toward paying the pensions of the public workforce. At the same time, they are paying taxes toward pension plans that are significantly different from what they receive in the private sector.
Senate Bill 1 provides employees with new benefits, choices in benefits and ownership over their investments while at the same time their retirement security is shielded from political risk. The legislation takes the General Assembly and others out of the businesses of making decisions on these issues.
Senate Bill 1: Modernizing & Stabilizing Pensions
- All new state and public school employees will be enrolled in a mandatory, 401k-type Defined Contribution Plan similar to those used by private sector workers.
- Members of the General Assembly, upon election or reelection, will be enrolled in the Defined Contribution Plan. The plan provision will be consistent with state and public school employees.
- Current employees must choose between increasing their pension contribution or reducing their future benefits.
- A Public Pension Management and Asset Investment Review Commission made up of investment professionals and retirement advisors will be established to make recommendations to the General Assembly and the Governor. Among their duties will be to evaluate the performance of current investment strategies and procedures of both state retirement systems regarding rates of return and associated fees paid for fund management.