Editorial: Corbett yields on budget, but slaps lawmakers on wrist Friday July 11, 2014 The Issue: The governor signs the spending guide without a fix for the pension crisis. Our Opinion: There was no upside for him, politically, but the retirement plans still need attention. Despite demanding that the Legislature tackle public-sector pension reform as a part of the 2014-15 budget process, Gov. Tom Corbett Thursday signed a $29 billion spending guide that includes no provision to alter the retirement plans for future state workers and public school teachers. However he did slap the wrists of lawmakers by using a line-item veto to take away $72 million they had set aside for themselves. This is the second time since Corbett took office in 2011 that he called for lawmakers to take action on a major policy issue - the first was his call to privatize the state liquor stores and use the revenue to increase education spending - only to see members of his own Republican Party, who control both the House and Senate, reject his proposals. The legislators refusal to deal with the pending pension crisis had some, The Wall Street Journal editorial board included, speculating that Republican members of the House and Senate view Corbett as a lame-duck governor and therefore were unwilling to buy into the plan he supported. That plan, introduced by Rep. Mike Tobash, R-Schuylkill, would combine a limited traditional, defined-benefit pension with a 401(k)-style defined-contribution plan to provide a smaller retirement benefit for future state employees and public school teachers than current ones receive. We would have liked to see Corbett stick to his demand that the budget include a pension fix, even if it were something other than the Tobash legislation. But with the governor already trailing Democratic candidate Tom Wolf by more than 20 points in the latest Franklin & Marshall College poll, Corbett didnt have much to gain politically by vetoing the budget, calling the Legislature back into session and delaying payments to state employees, welfare recipients, vendors and the like. No doubt, he would have been seen as the villain in such a case. Instead he chose to cut $72 million from the $320 million budget the lawmakers gave themselves in an effort to force the General Assembly to use its reserve of more than $153 million, which has been kept in a special account over the past few decades to underwrite its own agenda with little public scrutiny. Thats something that Corbett can use during the fall campaign to try to convince voters that he deserves a second term in the governors mansion. In the meantime, the pension problems continue to grow, especially for public school districts, many of which regularly are increasing their property tax levies in order to meet the fiscal requirements that began in 2001, when lawmakers gave themselves a 50 percent increase in their pensions and gave public employees a 25 percent increase. A lower-than-anticipated return on investments, especially during the Great Recession, forced the state and school districts to supply ever-increasing amounts to the pension plans to avoid massive underfunding. The problem is not going to go away. No matter how good the Pennsylvania economy becomes, pension reform is essential. Corbett had within his grasp the opportunity to force action. He opted instead to take $72 million away from the Legislature, a pittance by comparison.
Posted on: Fri, 11 Jul 2014 10:08:18 +0000
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