Pa. House passes bill to rescue state pension systems

Pa. House passes bill to rescue state pension systems

By Angela Couloumbis and Dan Hardy
Philadelphia Inquirer Staff Writers

Nov. 16, 2010

HARRISBURG - The state House of Representatives took a step Monday to defuse Pennsylvania's pension bomb.

The House approved a bill aimed at addressing the skyrocketing retirement costs of state and public-school employees, including legislators and teachers.

The so-called pension-reform bill would spread payments into the two pension systems over additional years, boost the retirement age for future employees, and give them the option of either contributing more to the plan or having their benefits trimmed.

Gov. Rendell, who has said he would sign the measure, estimated that the bill would save the state $16 billion in pension payments over the next 25 years.

"We can complain that this bill doesn't go far enough," said Rep. Glen Grell (R., Cumberland), who helped craft the measure, "or we can approve this bill, scale back the overly generous pension plans for all employees, and stop the bleeding."

The House, acting in the waning hours of its 2009-10 session, also took final action on a number of other measures. The Senate has already passed the pension bill, so it goes straight to Rendell's desk.

Debate on the legislation Monday centered on a Republican-backed amendment that the Senate had tacked onto the bill establishing an Independent Fiscal Office to act as a watchdog over legislative and executive-branch spending.

Some House members, including Rep. Dwight Evans (D., Philadelphia), had argued that the Senate move violated the so-called single-subject rule of the state constitution by adding that amendment. That, in turn, would have left the measure open to legal challenge, they said.

But a majority of House members in both parties disagreed and approved the pension bill by a 165-31 vote. Evans was among those voting "aye," despite his expressions of concern about its constitutionality.

Pennsylvania's largest teachers union swiftly applauded the bill's passage, even though it cut some benefits for future employees.

In a statement after the vote, James Testerman, president of the Pennsylvania State Education Association (PSEA), said: "Compromising and agreeing to changes to our pension system has been tough, but PSEA realizes that this legislation resolves the pension crisis in a responsible manner and over time will save the taxpayers billions of dollars."

Testerman added: "It also keeps the promise of a secure retirement for current and future workers."

Reaction from the Pennsylvania School Boards Association was more muted.

The association supported the legislation, said Thomas Gentzel, executive director. But it wanted the legislature to go further and replace the current system, which mandates that school districts and the state pay for a set amount, or "defined benefit," for retirees.

Instead, the school boards group supports a "defined-contribution" system for future employees. Such a system would mandate only that the plans pay a set amount into the system - with retirees getting whatever the system can afford to pay them, depending on how well its investments fare.

Matthew J. Brouillette, the president of the conservative Commonwealth Foundation, which opposed the bill, called it a "union pension bailout." He said that, because the pension bill pushes off some payments into the future, when they will cost more, "it is, plain and simple, generational theft."

"We're going to steal from our kids and grandkids in order to pay for a defined-benefit pension plan," said Brouillette, who, like the school boards group, favors a defined-contribution plan.

He contended that it was difficult to get more sweeping pension reforms because "legislators who are voting on the law are members of the problem system that we are trying to reform" - in other words, lawmakers' own future pensions could be affected.

In other business yesterday, the House, in a 161-35 vote, gave final passage to legislation expanding the "castle doctrine," which allows gun owners to defend themselves beyond their home (or "castle") or vehicle. The bill also would prevent an attacker from filing a civil suit against the victim.

The controversial language, opposed by many law enforcement officials, was attached to a bill strengthening the state's Megan's Law, which is meant to protect children from sex offenders.

Some Democrats, including the Megan's Law bill sponsor, said they were angry that the Senate had appended gun-rights language to such a bill. Rep. Rick Taylor (D., Montgomery), who was defeated in the Nov. 2 election, wound up voting against his own bill.

"I was trying to make lives in Pennsylvania safer and protect the most vulnerable citizens," he said. "It is not going to make children safer, but put more children at risk."

Steve Miskin, spokesman for House Republican leader Sam Smith (R., Jefferson), called that notion fearmongering by Democrats.

"This doesn't give people a license to shoot," Miskin said. "It gives law-abiding citizens the ability to protect themselves without becoming a victim again."

Rendell said he would review the bill.

Other legislation receiving final approval Monday night included measures to expand fathers' rights in child-custody court proceedings; create recycling requirements for computers and televisions; allow owners of land in the state's "Clean and Green" program to develop wind and other clean-energy projects; and create a trust fund to build affordable housing.