Capitolwire: Their budget won’t need pension reform, but the GOP plans to push for it anyway.
HARRISBURG (June 25) – The state budget – whether it’s built by the Governor and the Legislature, or just by the Legislature’s Republicans – is going to need a lot of things to make it work fiscally.
But pension reform isn’t one of those things.
When asked Thursday evening<x-apple-data-
Despite assertions to the contrary during the last few days and weeks, it now appears that whatever deal is worked out between House and Senate Republicans regarding pensions – and the two caucuses appear to be fairly on the same page according to various sources – it’s not going to produce immediate savings.
And without savings, it’s not an imperative to get pensions done as part of the what’s expected to be some form of Republican-constructed budget sent to Gov. Tom Wolf sometime next week, with the goal still to have the General Appropriations bill (but maybe not all of the other budget components) done before July 1.<x-apple-data-detectors://3>
But that doesn’t mean Republicans don’t want to pass pensions and soon. And it doesn’t mean the two caucuses won’t manage to pass something sometime next week.
If the Republicans are going to pass something, it certainly won’t be, at best, until late on June 30.<x-apple-data-detectors://
That’s because the Public Employee Retirement Commission (PERC) won’t be meeting until Monday afternoon, at 4 p.m.<x-apple-data-detectors://
The Senate-approved pension reform bill has yet to be scheduled for consideration by the House State Government Committee (but an announcement is expected soon), where it awaits action. The House Republican Caucus is expected to talk about pension plans Friday morning, and it’s anticipated that Republican leaders, a bit later in the day, will offer an explanation of what’s going to occur during the next few days as they work to get a budget done.
Sources close to the pension situation said that as early as Thursday morning<x-apple-data-
“We are scheduling a meeting for late Monday afternoon<x-apple-data-
At least two amendments are believed to be in the offing, possibly more.
One of those appears to be tied to the primary reason SB1 isn’t necessary to balance any state budget.
Rep. Daryl Metcalfe, R-Butler, who chairs the House State Government Committee, indicated in early June<http://www.capitolwire.
That would have provided some immediate savings, at the expense of adding to the unfunded liability. Senate Republicans were also apparently open to reducing state contributions, through more “collaring” of those contributions, for additional immediate savings, with some estimates being about $200 million.
Sources said that idea was roundly rejected by the House Republican Caucus when initially proposed. And it hasn’t found any traction in the caucus since then.
When asked by Capitolwire on Wednesday if collared payments are still being considered, House Speaker Mike Turzai, R-Allegheny, said: “No.”
Another change coming to SB1 presaged by public hearings held by Metcalfe’s committee<http://www.
During two hearings held in early June, testimony supplied to the committee reinforced one particular item that has been a concern every time changes to the state’s public pensions are considered and discussed: those state employees represented by the Pennsylvania State Troopers Association and the Pennsylvania State Corrections Officers Association don’t want their pension benefits to change at all.
And sources close to the pension issue say there are plenty of House Republican Caucus members who agree with them – so look for that proposed change on Monday.
As for the remainder of SB1, there appears to be general consensus between the caucuses on most of it.
And while there might not be immediate savings, Republicans in both chambers note PERC’s analysis of the bill identifies longer-term savings. Some of that savings would come from items potentially agreeable to the governor, such as an “anti-spiking” provision and “risk-sharing” concepts for current employees, although not necessarily what’s contained in SB1.
But even with those savings provisions – which, along with other more significant changes to current employees’ future benefits, could all run afoul of the state Supreme Court on the basis of contract impairment – included in the bill, Republican leaders on both sides of the Capitol appear to agree the key to the bill is its switch, for newly-hired employees, from a defined benefit plan to a defined contribution/defined benefit hybrid plan.
Despite Gov. Wolf, earlier this week, telling GOP leaders he would not support such a switch<http://www.capitolwire.
SB1 could be reported out of committee at any time between now and Sunday, which would allow the bill to be positioned for Second Consideration (and possible amendment) in the House following the PERC meeting Monday afternoon<x-apple-data-
If SB1 is amended on Monday, that would still allow for final consideration of the measure on Tuesday – possibly later in the day, if the bill is amended on Monday afternoon<x-apple-data-
Monday’s 4 p.m.<x-apple-data-detectors://
Robert J Storm
Eastern Region Vice President
Pennsylvania State Corrections Officer Association
Toll Free:1-866-GO-PSCOA