Thursday, October 21, 2010

Santarsiero on Pensions

from the inbox:

State Rep. Steve Santarsiero, D-Bucks, today called on House Speaker Keith McCall and Senate President Pro Tempore Joseph Scarnati to reconvene session to pass the Public Pension Relief Measure before the election.

"Waiting will not solve this issue," Santarsiero said. "Our local school districts need stable and predictable pension costs to avoid steep property tax hikes and to help our schools improve education by investing in classroom instruction."

Santarsiero said legislation (H.B. 2497) passed by the Senate last week included additional pension reforms agreed to by the House and Senate. But it also included a last minute amendment to create the Independent Fiscal Office. An independent legislative legal office has issued an opinion that the IFO amendment would not withstand a constitutional challenge.

The pension relief provisions added by the Senate would provide $3 billion in savings from the current law and $39 billion from the original public pension relief package passed by the House in June.

The Senate version provides for further savings by creating a "shared risk" provision, which would change current law to shift the costs of any investment loss from the employer to increases in employee contributions. It also would impose the "Rule of 92" which would require employees to compile a combination of age and years of service totaling 92 before receiving full retirement benefits.

"Together, the reforms proposed in the House and Senate would make Pennsylvania a leader in addressing long-term financial stability of the pension systems to reduce taxpayer liability," Santarsiero said. "It's clear we have made great progress on the pension issue, but we can’t allow the Senate’s last-minute addition of a new and separate issue like the Independent Fiscal Office to jeopardize real pension reform.

"The Independent Fiscal Office merits its own debate and vote," he added. "The Senate's actions are exactly what people are tired of seeing in Harrisburg – cheap shots to set others up for failure instead of sitting down and finding solutions to the problems facing our Commonwealth."

Currently, the state's retirement systems -- Public School Employees Retirement System and the State Employees Retirement System -- are in jeopardy due to a combination of investment downturns, pension abuses under previous administrations and the global economic crisis of 2008, as well as increasing benefits and a COLA for retired employees.

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