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PA: Romney tells voters he’ll boost national economy

PA Independent — Sun, 17 Jun 2012 01:46:39 +0000

Romney: 'Our economy runs on freedom'

By Melissa Daniels | PA Independent

CORNWALL — Republican presidential candidate Mitt Romney told Pennsylvania voters Saturday that if elected president he would bring economic freedom back to the United States.

Romney spoke to a crowd of hundreds at the 18th-century iron-making site Cornwall Iron Furnace in Lebanon County, the last of three stops in Pennsylvania he made during part of the “Every Town Counts” campaign trail.

Much of his speech focused on how, if elected, Romney would boost America’s economy, something he said incumbent President Barack Obama has failed to accomplish.

“I’m going to take advantage of our extraordinary energy resources,” Romney said to cheers. “We got natural gas, coal, oil and that pipeline from Canada.”

Also in attendance was Gov. Tom Corbett, Lt. Gov. Jim Cawley, Congressman Jim Gerlach, R-Berks, Sen. Pat Toomey, R-Pa., and Gov. Tim Pawlenty of Minnesota.

PA Week in Review: Budget, privatization plans stalling

PA Independent — Fri, 15 Jun 2012 19:02:25 +0000

Unemployment remains flat from April

By Staff Reports | PA Independent

HARRISBURG — A busy week at the Pennsylvania statehouse started off with a late night, when House lawmakers stayed until 10:30 p.m. Monday debating the pros and cons of privatizing the state's liquor sales, only to refrain from voting.

But the next day, state business continued with news of potential lottery privatization, as well as plans to change the state's pension system for future employees. Lawmakers also are negotiating the final details of the state budget, which must be passed by the end of June.

No matter the business, a new poll shows Pennsylvanian voters are watching this administration, with approval ratings for Gov. Tom Corbett hitting an all-time low.

Budget talks continue as June 30 deadline looms

Though some Republican lawmakers said the state budget would be done by June 13, that date came and went without a final plan.

Lawmakers gave few details about the issues at the center of their negotiations amongst themselves and with the Corbett administration, but said a final spending figure had not been agreed upon.

“It will probably be a few days until we meet with” Corbett, said House Speaker Sam Smith, R-Jefferson, as he left a meeting with GOP House and Senate leaders Wednesday afternoon.

State Sen. Pat Browne, R-Lehigh, said the situation was too fluid to make a guess at when the final package might be ready.

“We’re still putting together a final amendment that we can present to the governor,” Browne said.

Corbett proposed a budget of $27.1 billion in February, but the state Senate upped that total to $27.6 billion with its version of the budget last month.

Tuesday, Corbett said he was open to adding money to the budget above his proposal, but reiterated his view of the state Senate figure as a “ceiling.”

Democrats were shut out of the closed-door meeting, but have been calling for an increase in state spending on public education, higher education and social services at the county level.

Unemployment rate remains flat from April

Pennsylvania’s seasonally adjusted unemployment rate remained at 7.4 percent in May, unchanged from April, according to figures from the Department of Labor and Industry.

For more than four years, Pennsylvania’s jobless rate has remained below the national rate, which was 8.2 percent in May.

The number of people working or looking for work in the state increased to 6.45 million, up 23,000 from April.

The sector with the largest job growth in May was the professional and business services industry, with a gain of 1,800 jobs. Leisure and hospitality lost 4,300 jobs, the largest drop for any industry in May.

Liquor privatization vote postponed until Monday, maybe longer

Speculation on when lawmakers will vote on a plan to privatize liquor sales continues after hours of House floor debate ended Monday without a vote.

The vote on a measure proposed by House Majority Leader Mike Turzai, R-Allegheny, also failed to show in Tuesday and Wednesday sessions, but Turzai said it could happen Monday.

Meanwhile, union opposition to the bill remains strong, though members protesting the bill at the Capitol refused to claim victory Wednesday.

“It may be an anachronism, but it works for Pennsylvania,” said United Food and Commercial Workers member Richard Granger of the state-owned and operated liquor store system.

The Pennsylvania AFL-CIO, one of the largest labor unions in the state, among others, sent notices to members asking them to call lawmakers about the liquor privatization bill.

PA lottery privatization plans move ahead

This week, the state’s Department of Revenue announced the Corbett administration is making headway on plans to privatize the Pennsylvania Lottery.

The department received responses for a request for qualifications to explore a private management agreement. The next step in the sealed bidding process will last three to four months, according to a news release from the Department of Revenue.

“We’ve determined it’s appropriate to take the next steps and move into a due diligence phase of the project, where qualified bidders and the commonwealth will interact to learn about each other’s business, explore ideas on improving operations and maximizing Lottery profit, and determine what a private management agreement for the Pennsylvania Lottery might look like,” said Department of Revenue Secretary Dan Meuser in the news release.

The company that provides the state with gaming systems and instant games, Scientific Games, has agreed to be involved in the conversation as plans for privatization continue.

House passes amendments to Wiretap Act

Proposed updates to the state’s wiretap law has some wondering if Pennsylvania is helping its law enforcement agencies track criminals or lowering expectations of privacy.

The state House passed House Bill 2400 on Wednesday afternoon with a 145-to-52 vote.

The bill amends Act 18, commonly known as the Wiretap Act, by broadening the legal circumstances under which civilians can record oral communication without consent, and how recordings can be used as evidence in the criminal court system, among around a dozen new provisions and updates.

Despite some provisions designed to help law enforcement agencies do their jobs, Democratic and Republican legislators voiced concern about how additional changes in the act could lead to problems down the road.

But those who support the bill say it will help law enforcement use modern technology to track criminals and obtain evidence.

“Our laws fail to reflect the current technology to their advantage,” said the bill’s sponsor, state Rep. Ron Marsico, R-Dauphin. “Technology has made advances that law enforcement is not able to keep up with."

Tax credit school choice plan may replace vouchers

A bipartisan group of Pennsylvania lawmakers are planning for a final push that could give about 30,000 students a way out of the state’s poorest performing school districts.

State Rep. Jim Christiana, R-Allegheny, is supporting legislation that would create a business tax credit program to fund scholarships for students in the 15 percent worst performing school districts. (Click here to read a memo outlining the proposal)

The plan would mirror the Education Improvement Tax Credit program, which directs business contributions to scholarship accounts for students from families who make less than $75,000 annually.

The new plan would be called the Education Improvement Scholarship Credit.

The EITC would remain on schedule to increase to $200 million next year, but Christiana’s proposed program would be capped at $100 million the first year and grow to $200 million by the third year, he said Monday.

“It’s an attractive program for those who want to get students out of violent, failing schools,” Christiana said.

Corbett and Senate Republicans spent most of last year pressing for a voucher program that would direct some state tax dollars from public schools to scholarships for low-income students in failing schools.

The plan passed the state Senate in October, but did not receive much traction in the state House.

Voter poll shows Corbett disapproval rating grew

A recent poll shows support for Corbett is decreasing among Pennsylvania voters.

A meager 36 percent of voters approve of the way the first-term governor and former Pennsylvania attorney general is doing his job, compared with 47 percent who disapprove, according to a Quinnipiac University poll released Tuesday.

Corbett's approval rating is down from an all-time high of 50 percent based on a September Quinnipiac poll.

But these figures don’t bother Corbett — he doesn’t read polls, he said.

“If I was looking at the polls, I wouldn’t be doing some of the things I’m doing, would I?” Corbett said.

Of the Democrats polled, 68 percent disapprove of Corbett's time in office compared with 26 percent of Republicans and 45 percent of independents. Corbett also has a better reputation with men, with 40 percent approving, compared with 32 percent of women approving.

VIDEO: Corbett signs unemployment compensation reform bill

Corbett signed a bill into law Tuesday that will let the commonwealth pay off nearly $4 billion in federal debt.

The bill, passed by both chambers last week, allows Pennsylvania to refinance the debt it owes to the federal government’s Unemployment Trust Fund by borrowing a $4.5 billion bond, which has a lower interest rate.

The bill also includes eligibility tweaks that will save the state millions in unemployment benefits by limiting access to around 50,000 workers.

Corbett described the debt payoff as an economic stimulus, since businesses have paid extra taxes to cover the debt and associated interest. Now, Corbett said, they can put those funds toward hiring people.

“Most importantly, the bill protects our workers while taking away a burden that has slowed job growth and investment,” he said. “Unemployment compensation reform really equals jobs. It’s that simple. And that’s what I talk about all the time is creating jobs in Pennsylvania."

GOP pension plan would give incentive for current workers to leave state system

A group of Republican lawmakers want to move all future state employees into a new retirement plans as a way to stop the increasing unfunded liability that is becoming a lead weight around Pennsylvania's budgetary neck.

The proposal contained in House Bills 2452 and 2453, which state Rep. Warren Kampf, R-Chester, introduced Tuesday in the state House, will not reduce the unfunded liability in the state's two major pension systems, but promises long-term savings by moving employees out of the unsustainable pension systems.

According to the bill, all new employees would be entered into a defined contribution plan, similar to 401(k) plans used in the private sector where each employee can make their own decisions about investing and saving for retirement.

All employees would receive a 4 percent employer contribution to a retirement account and would have to make at least a 4 percent contribution on their own. Existing employees would not be required to change plans, but if they voluntarily moved to the new plan, they would receive a 7 percent employer contribution as an incentive.

“This plan provides change. It says to the taxpayers, we are smart enough now to know that we can’t keep adding people to the system because it only makes the problem worse,” Kampf said.

Taken together, the State Employees Retirement System and Public School Employees Retirement System are facing nearly $40 billion in unfunded liabilities, and contributions to the systems by the state and school districts will nearly triple in the next four years — from $1.6 billion to $4 billion.

PA: More than $520M in Medicare, Medicaid fees went to potentially avoidable hospital stays

PA Independent — Fri, 15 Jun 2012 17:53:29 +0000

Report: 1 in 8 hospital stays could've been prevented

By Melissa Daniels | PA Independent

HARRISBURG — Of the nearly 185,000 Pennsylvanians who underwent hospital stays that could have been prevented in 2010, taxpayer-supported programs paid for about 83,000 of them.

Medicare and Medicaid payments totaling about $521 million could have been avoided with better outpatient care, according to a new report titled “Potentially Preventable Hospitalizations in Pennsylvania.”

The report was released by the Pennsylvania Health Care Cost Containment Council, or PHC4, earlier this month. PHC4 is an independent state agency created in 1986 that supplies information on health-care costs to employers and employees, created after the urging of business and public-sector labor groups.

Some say new models of primary care could reduce these hospital stays.

Medicare payments of $480 million covered “potentially preventable hospitalizations,” such as bacterial pneumonia, asthma and heart failure. The average cost per stay was $6,209 for 77,386 patients, or around 41 percent of all stays examined in the report.

An additional $41 million in Medicaid payments went toward similar stays, according to the report, with an average cost of $6,527 per 6,320 hospital stays.

Payment figures from private insurance companies making up the difference were not available to the council in drafting the report.

Overall, the report says one in eight hospital stays in 2010 fell into categories that could have been prevented. But, Gary Tuma, director of communications for PHC4, said not all of the hospital stays tallied in the report could have been prevented.

The goal of the report, he said, was to identify weaknesses to see what the health-care industry could do to address unnecessary stays as a whole.

“This report shows when you look at the potentially preventable hospitalizations, that somewhere in the process there was a breakdown in primary care, and that breakdown can occur at all sorts of points,” Tume said.

The report also showed a higher rate of potentially preventable hospitalizations in Pennsylvania compared with the rest of the United States, with an average of 195.6 per 10,000 residents compared with 182.5.

Molly Talley, director of resident and student initiatives for the Pennsylvania Academy for Family Physicians, a health-care advocacy and policy group, said the report reflects a larger problem in the health-care system as a whole.

Better coordination of medication records and lab results, along with team physician approaches as opposed to traditional offices, could provide better primary care before conditions become severe enough for hospitalization, she said.

Those developments could be useful specifically for the state’s elderly on Medicare, who may be seeing a number of specialists who aren’t coordinating with each other.

“Older people are much more sensitive to medications, so properly managing their medicines is important,” Talley said. “In this particular study, it might be culmination of a bunch of different things that didn’t have to happen that way for this person.”

Some in the state’s health-care industry are looking at new options at the primary care physician level that could reduce the rate of unnecessary hospitalizations.

On Wednesday, regional insurance provider Capital BlueCross announced a new partnership with multi-campus health-care provider PinnacleHealth Systems.

The partnership, called an "Accountable Care Arrangement,” would be the first of its kind in Pennsylvania.

The model increases coordination among providers with electronic medical records, along with nursing resources provided by Capital.

PA ANALYSIS: Proposed pension fixes only part of the solution

PA Independent — Fri, 15 Jun 2012 17:23:53 +0000

Unfunded liability has to be paid off no matter what changes are made for future employees

By Eric Boehm | PA Independent

HARRISBURG — Fixing Pennsylvania’s public pension system will require more than creating a new plan for future employees.

There’s also the 1,000 pound gorilla in the room — a nearly $40 billion unfunded liability run up by the state’s two public pension systems.

Republicans are starting to craft proposals that would move future employees into a more affordable benefit scheme.

But James McAneny, executive director of the state Public Employees Retirement Commission, a state agency that analyzes and reviews state and municipal pension plans, said that approach only will help make future state employee contributions to the systems more affordable.

“It doesn’t do anything for the paying off of the existing unfunded liability. We actually have that debt,” he said of the proposals announced so far in the General Assembly.

The State Employees Retirement System is facing an unfunded liability of about $10 billion and the Public School Employees Retirement System, a $26 billion liability.

Those liabilities represent currently owed benefits only, not benefits that will be earned by current or future state employees.

Once the state budget is settled and lawmakers take their summer vacations, pension reform figures will be one of the front-burner issues this fall. State House and Senate Republicans are outlining plans to close off the existing pension plans to future hires.

State Rep. Warren Kampf, R-Chester, put forth a plan in the state House this week to move future state employees and public school teachers into a defined contribution system — similar to 401(k) plans in the private sector, where employers and employees make contributions into a retirement account that employees can invest as they choose.

A similar proposal is being crafted by Senate GOP leaders, who are circulating memos trying to gather more support for the plan among their peers before officially introducing it.

As part of that memo, the lawmakers make the case that Pennsylvania should move public workers into a defined contribution plan to ensure future liabilities are fully funded and to eliminate the risk of future pension crises.

Kampf made the same argument Tuesday when he introduced his plan.

But fixing future benefits without finding a way to pay off the liability is like maxing out a credit card, then not charging on it but also deciding not to pay off balance, said McAneny.

“That liability is an existing debt,” he said.

State Sen. Pat Browne, R-Lehigh, one of the architects of the Senate proposal, acknowledges the need for funding reform along with restructuring future benefits.

“That would have to be a part of the overall plan,” Browne said. “It’s going to be part of the discussion, and we’ll see what we can do in the fall.”

Browne said the Senate leadership’s final package would include funding reforms to pay off the existing liability, but the group had not determined the best way to do so.

The backers of the Senate plan include Majority Leader Dominic Pileggi, R-Chester; Appropriations Chairman Jake Corman, R-Centre, and Finance Chairman Mike Brubaker, R-Lancaster.

Corman has suggested that the state also could change the rules for current employees and reduce their future benefits, which have not been earned.

But this approach would do nothing about the existing liability.

And a further wrinkle exists.

If the current system is closed down immediately — or at some specific time — the unfunded liability must be paid off before the last current worker retires, likely within a period of 30 years or so, McAneny said.

With a liability larger than the state budget, even a 30-year time frame makes the problem a big one. And the workers that remain in the system will continue earning benefits during that period.

Keeping the current system and allowing workers to continue to enter it means there is no set date for when the last worker will retire and thus the state can continue to push off the payment of the unfunded liability indefinitely, said Rick Dreyfuss, a retired actuary and pension expert for the Commonwealth Foundation, a free market think tank here.

Unions that represent public-sector employees argue that changing to a defined contribution system will cost the state.

David Fillman, executive director of American Federation of State, County and Municipal Employees Council 13, which represents the largest chunk of state government employees here, told PA Independent this week that moving employees into a new plan would do nothing to fix the pension crisis in the short term because future workers are needed to help pay off the unfunded liability.

That logic assumes that the pension plan operates like the federal Social Security system, in which current workers pay taxes to support the benefits of retirees. Critics of that formula have compared it to an illegal Ponzi scheme.

But the state pension systems are different: benefits are earned directly by workers as part of a formula set out in their contracts.

While having more workers in the future helps to keep cash flowing into the system, those contributions are not being used to pay down the liability — only the state’s contributions and investment earnings in the pension system can do that.

“It doesn’t work like Social Security. You don’t need future employees to fund it,” said Browne on Wednesday. “The debt is the obligation of the commonwealth.”

PA: Romney campaign makes three stops in commonwealth

PA Independent — Fri, 15 Jun 2012 17:17:21 +0000

Stops include manufacturing sites, gas station

By Melissa Daniels | PA Independent

HARRISBURG — Presumptive GOP nominee Mitt Romney is taking his campaign to Pennsylvania on Saturday.

The Massachusetts governor’s itinerary suggests he’ll focus on state workers, with visits to sites connected to the manufacturing and energy industries central to the commonwealth’s economy.

Romney will make these stops in southeastern Pennsylvania:

Weatherly Casting and Machine Co. at 9:15 a.m. in Weatherly;
WaWa Gas Station at 12:40 p.m. in Quakertown;
Cornwall Iron Furnace at 5:15 p.m. in Cornwall.

Earlier this week, a Quinnipiac University Polling Institute poll among registered Pennsylvanian voters found Romney was trailing President Barack Obama, with 46 percent supporting Obama and 40 percent saying they would vote for Romney.

But, voters said Romney would do a better job handling the nation’s economy than Obama, 49 percent to 41 percent. Forty-five percent of those polled said Romney would create more jobs, while 43 percent said the same of Obama.

PA: Liquor privatization vote postponed until Monday, maybe longer

PA Independent — Thu, 14 Jun 2012 17:06:56 +0000

Unions, special interests versus 70 percent of Pennsylvanians

By Eric Boehm | PA Independent

HARRISBURG — Don't touch that bottle.

It belongs to Pennsylvania, at least for now.

Richard Granger, clad in a bright yellow shirt, is pleased. He stood alongside dozens of people Wednesday on the marble steps of the state Capitol, the most obvious sign of layers of effort that helped stop a vote to privatize Pennsylvania's state-owned liquor business.

Granger and his brightly-clad comrades are members of the United Food and Commercial Workers, the union that represents many of the nearly 5,000 workers in Pennsylvania’s liquor business.

The union led the opposition to the privatization plan pushed by House Majority Leader Mike Turzai, R-Allegheny, staging a sit-in at the Capitol and telling members to voice their opposition to local lawmakers. Granger and others refused to claim victory on Wednesday, saying they would continue to vocally oppose the privatization plan until there was no chance for it to become law.

“It may be an anachronism, but it works for Pennsylvania,” Granger said of the state-owned and operated liquor store system.

It certainly works for the unions, though at one point on Monday night the idea seemed headed for the proverbial gutter.

But House Republicans cut off debate after 10 p.m. That came after several hours of talk without taking a vote on the proposal, which was in a proposed amendment offered by Turzai.

Promised votes Tuesday and Wednesday failed to materialize as the union sit-in continued and other unions urged its members to call lawmakers and urge opposition.

Turzai told reporters Wednesday the bill would remain on the House’s voting calendar for Monday — their next session day — but other Republicans said the number of votes for the measure had declined after behind-closed-door meetings Tuesday and Wednesday.

The UFCW got plenty of help from other unions.

The Pennsylvania AFL-CIO, one of the largest labor unions in the state, among others, sent notices to members asking them to call lawmakers about the liquor privatization bill.

“We need to make sure our representatives hear from as many people as possible about why this blatant giveaway from extreme politicians to their corporate donors is bad for Pennsylvania working families,” one statement from the union said.

Union groups have argued that more than 4,500 jobs will be lost if the state system is privatized, but Republicans have countered by arguing that the 1,600 private sector stores will create additional opportunities for jobs — including union jobs.

Steve Miskin, Turzai’s spokesman, downplayed the role of the unions in keeping the bill from getting the necessary votes.

“Truly this is not a union issue. It’s a consumer issue. Either you’re for Pennsylvania consumers and taxpayers or you are against them,” he said.

Other opposition to the plan came from the Pennsylvania Malt Beverage Distribution Association, which represents beer wholesalers and distributors.

In Turzai’s plan, beer distributors would have the first shot at buying one of the 1,600 new liquor licenses — finally allowing Pennsylvanians to purchase beer and liquor in the same location — but the association said it had other concerns.

Primarily, they are worried about other licenses being bought up by “big box” stores that represent competition in a previously closed marketplace.

“Ultimately, this amendment is really intended to drive beer distributors out of the market,” the association warned in a memo to its members last month.

Consumers, meanwhile, remain stuck with a system that is uniquely complicated in the United States.

Polls have consistently shown a majority of Pennsylvanians are in favor of privatizing the liquor system, but the state monopoly set up in the wake of Prohibition has remained stubborn despite numerous attempts to end it, including efforts by the past two Republican administrations in Harrisburg during the 1980s and 1990s.

Jay Ostrich is communications director for the Commonwealth Foundation, a free market think tank here that has been pushing for the privatization plan. He said the failure to bring the issue to a vote was a sobering reminder of government’s inability to get out of its own way.

“When broad-based bipartisan support from voters isn't enough to get the job done, it clearly suggests something is broken under the dome,” he said in an email.

Gov. Tom Corbett has supported the privatization plan since he took office in 2011, and reportedly was helping drum up votes from both sides of the aisle this week.

Publicly, however, he played off his role in the privatization battle.

“Do I support privatization? Absolutely,” he told reporters Tuesday. “This is a good first step, let’s get this first step done.”

Even if the vote had been taken this week — or is taken next week — Republican leadership in the state Senate has all but shut off the possibility of approving the bill before the end of the budget process this month.

Senate President Joe Scarnati said this week that he supported the Turzai proposal, and looked forward to working on it “in the fall.”

PA: GOP leaders blow unofficial deadline as budget talks continue

PA Independent — Wed, 13 Jun 2012 22:17:39 +0000

Unofficial deadline of June 13 officially blown

By Eric Boehm | PA Independent

HARRISBURG — When budget negotiations began in earnest late May, Republican House and Senate lawmakers pointed to June 13 as their deadline for getting the spending plan to Gov. Tom Corbett’s desk.

Well, that deadline is passed with no budget on the table, but this is no surprise. Many saw this deadline as optimistic posturing on the part of Republicans, who control the entire process for the second consecutive year in a row.

The state constitution actually requires a budget to be passed by June 30 — a deadline that has been missed far more often than hit in recent years.

Lawmakers gave few details about what issues are at the center of their negotiations, but said a final spending figure had yet to be agreed upon.

“It will probably be a few days until we meet with” Corbett, said House Speaker Sam Smith, R-Jefferson, as he left a meeting with GOP House and Senate leaders Wednesday afternoon.

State Sen. Pat Browne, R-Lehigh, said the situation was too fluid to make a guess at when the final package might be ready.

“We’re still putting together a final amendment that we can present to the governor,” Browne said.

Corbett proposed a budget of $27.1 billion in February, but the state Senate upped that total to $27.6 billion with their version of the budget last month.

Tuesday, Corbett said he was open to adding money to the budget above his proposal, but reiterated his view of the state Senate figure as a “ceiling.”

Democrats were shut out of the closed-door meeting, but have been calling for an increase in state spending on public education, higher education and social services at the county level.

PA: House passes updates to Wiretap Act

PA Independent — Wed, 13 Jun 2012 21:51:17 +0000

Lawmakers on the left and right voice opposition

By Melissa Daniels | PA Independent

HARRISBURG — A bill that would update the state’s wiretap law has some wondering if Pennsylvania is helping its law enforcement agencies track criminals or lowering expectations of privacy.

The state House passed House Bill 2400 on Wednesday afternoon with a 145-to-52 vote.

One such change is allowing audio recording without consent from those being recorded if notice of possible recording is posted somewhere, like a student handbook or on a bulletin board.

State Rep. Mark Cohen, D-Philadelphia, said the commonwealth would become the No. 1 state in citizen wiretapping if the legislation passes.

“It fundamentally changes the nature of privacy in Pennsylvania,” he said on the House floor.

State Rep. Daryl Metcalfe, R-Butler, questioned the ability of schools to record students, and said the bill would "change the whole thought about the reasonable expectation of privacy,"

But other representatives urged passage of the bill, noting that the last update to the Wiretap Act was in 1998.

Among the provisions designed to help law enforcement are:

Allowing law enforcement to receive a warrant to wiretap a person, rather than a phone line, to continue tracing suspects who may be ditching a cell phone to keep away from police;
Permitting wiretaps from other jurisdictions to be used as evidence in Pennsylvania trials.

Marsico told the House about a woman who had recorded a man who attacked her viciously and heard him confess. But upon turning that tape into the police as evidence, she was charged with a felony for violating the state’s two-party consent law.

Under HB 2400, only one party would need to be aware of a wiretap or recording for it to be legal, if they believed that the other party would speak about committing a crime, or confess to one.

The Pennsylvania chapter of the American Civil Liberties Union opposed the bill during its three-week journey through the House, focusing on five of the 12 provisions.

The chapter’s legislative director, Andy Hoover, said several provisions threaten the expectation of privacy of law-abiding citizens.

Hoover said the bill’s language could lead to people spying on each other without basis, going on fishing expeditions for information under the guises of confessing. It’s too broad, and a proposal to narrow it down supported by the ACLU was shot down, he said.

“This potentially opens the door to political opponents recording their enemies, however they can, in an attempt to catch them in something,” Hoover said. “There will be extremists who could use this to get more recordings than they can get right now.”

Greg Rowe, legislation liaison for the Pennsylvania District Attorneys Association, a group representing prosecutors statewide, said the recording provision is linked specifically to the most violent of offenders, and two-party consent is preserved in all other circumstances. It can’t be used, he said, for proving guilt of minor crimes.

Furthermore, Rowe said, Pennsylvania is one of 12 states to require two-party consent, and it will continue to be in the minority of those states who do while “targeting important exceptions in certain circumstances.”

“The real impact here, the primary impact, is going to be on those who are committing the most violent crimes, the ones who are rapists, committed murder or serious aggravated assaults,” Rowe said.

PA: Fiscal Office sets final parameters for budget battle

PA Independent — Tue, 12 Jun 2012 22:35:23 +0000

Confirms previous estimate of $27.5B in revenue

By Jared Sichel | PA Independent

HARRISBURG — Pennsylvania’s Independent Fiscal Office confirmed its revenue estimates for the current budget year at $27.54 billion, setting the playing field for the final three weeks of the state budget battle.

At present, next year’s budget bill would spend about $27.6 billion.

Gov. Tom Corbett has called that figure a “ceiling” and is pressuring lawmakers to bring the total back down toward his budget proposal in February that called for a $27.1 billion spending figure.

The IFO — a new body designed to be a counterweight to Corbett's Budget Office when it comes to make revenue estimates — said on May 1 that the state would collect about $27.5 billion in revenue this year, emboldening Democrats who wanted to spend more than Corbett’s plan.

The state Senate passed a bipartisan budget at $27.6 billion, which is awaiting action in the state House, where lawmakers and the administration are haggling over line items.

Tax revenue in May and estimates for June were used by the IFO in confirming its initial projection of $27.5, which was made May 1.

Now, the power might shift toward those who want to spend less, since the IFO projection did not increase after another month of data was available – and projected a $48 million decline over its estimated revenue totals for next year.

Corbett repeatedly has said the state will not spend more than it takes in, and is pushing for a lower figure, though he acknowledged Tuesday that he’s open to spending more than $27.1 billion.

"At the same time, we’re not in the position, in my mind, to go to that top level that the Senate came out with six weeks ago,” Corbett said.

House Democrat spokesman Bill Patton said he expects the Republicans to consider the IFO’s new estimate when crafting the new budget.

“The majority GOP party that is engaging in the budget negotiations is the same one that pushed for the formation of the IFO,” Patton said. “It would be nonsensical for them to disregard the IFO’s data at this point.”

The IFO’s fiscal 2012-13 estimate for general fund revenue is $28.6 billion, 3.8 percent higher than the previous fiscal year’s collections, but $48 million lower than the May 1 initial estimate.

IFO Director Matthew Knittel attributed the revised estimate to “weakness in Europe as well as from the uncertainties of U.S. fiscal policy.”

PA: GOP pension plan would give incentive for current workers to leave state system

PA Independent — Tue, 12 Jun 2012 21:22:38 +0000

All new employees would be forced into 401(k)-style system

By Eric Boehm | PA Independent

HARRISBURG — A group of Republican lawmakers want to move all future state employees into a new pension system as a way to stop the increasing unfunded liability that is becoming a lead weight around Pennsylvania's budgetary neck.

The proposal is contained in House Bills 2452 and 2453, which state Rep. Warren Kampf, R-Chester, introduced Tuesday in the state House, will not reduce the unfunded liability in the state's two major pension systems, but promises long-term savings by moving employees out of the unsustainable pension systems.

“This plan provides change. It says to the taxpayers, we are smart enough now to know that we can’t keep adding people to the system because it only makes the problem worse,” Kampf said.

In place of the current system that determines pension benefits based on a formula of years worked and final highest salary, all employees would receive a 4 percent employer contribution to a retirement account and would have to make at least a 4 percent contribution on their own.

Existing employees would not be required to give up the defined benefit system, but if they voluntarily moved to the new plan, they would receive a 7 percent employer contribution as an incentive.

However, stopping new employees from enrolling in the current pension system would at least prevent that liability from growing larger — as long as the state makes mandatory contributions to the system and investment returns hit their expected 7.5 percent annual rate of return for investments, which some say are too rosy to be realistic.

Opponents warned that few employees — except for those who are relatively new to the defined benefit system — would opt for the defined contribution system and those who did and accepted the 7 percent contribution from employers would represent an addition cost.

David Fillman, executive director of American Federation of State, County and Municipal Employees Council 13, a union which represents some state government workers, said taking workers out of the current system would reduce the number of people paying toward the unfunded liability, actually making the pension crisis worse.

“This sounds even worse than just putting all new employees into a defined contribution plan,” he said.

Kampf said the proposal would reduce long-term costs in the system by getting workers out of it, but exact figures have not been calculated.

State Rep. Kate Harper, R-Montgomery, who supports Kampf’s plan, said it would help balance the budget.

“The problem here is that the budget deficit for pensions is bigger than our entire budget,” she said. “We just can’t afford these benefits going forward.”

Gov. Tom Corbett said Tuesday he had not reviewed the Kampf proposal but reiterated his recent push for pension reform on a broad scale.

“We gotta get pension reform done,” Corbett said, arguing that the pension crisis is at the root of all state government, local government and school district budget issues right now.

PA: Corbett says unemployment reform equals more jobs

PA Independent — Tue, 12 Jun 2012 20:34:06 +0000

Governor signs bill to refinance federal debt

By Melissa Daniels | PA Independent

HARRISBURG — Gov. Tom Corbett signed a bill into law Tuesday that will let the commonwealth pay off nearly $4 billion in federal debt.

The bill also includes eligibility tweaks that will save the state millions in unemployment benefits by limiting access to around 50,000 workers.

The governor also lauded the bill for the cost savings associated with the new eligibility requirements, saying the state will save $276 million annually while making sure the system is supporting those workers who “are fully participating in the workforce.”

“I can tell you from the budget discussion we’ve had today, $276 million is going to be very helpful, rather than paying it to the federal government, for us to have in the budget,” Corbett said.

PA: Voter poll shows Corbett disapproval rating grew

PA Independent — Tue, 12 Jun 2012 20:32:55 +0000

Poll shows downward trend

By Melissa Daniels | PA Independent

HARRISBURG — Gov. Tom Corbett hit an all-time low this week.

A meager 36 percent of voters approve of the way the first-term governor and former Pennsylvania attorney general is doing his job, compared with 47 percent who disapprove, according to a Quinnipiac University poll released Tuesday.

But these figures don’t bother Corbett — he doesn’t read polls, he said.

“If I was looking at the polls, I wouldn’t be doing some of the things I’m doing, would I?” Corbett said.

The poll queried 997 registered voters from June 5-10 with a margin of error of plus or minus 3.1 percentage points.

Corbett's approval rating is down from an all-time high of 50 percent based on a September Quinnipiac poll, which surveyed 1,370 voters.

Corbett had “a heck of start,” said Tim Malloy, assistant director of the Quinnipiac University Polling Institute, especially compared with other first-term Republican governors in Ohio and Florida.

“His approval ratings were high. They have precipitously dropped in the last nine months, corresponding in time to a budget which brought cuts to education and other services,” Malloy said.

Corbett’s not the sole target of Pennsylvania’s dissatisfaction with its state government. The state Legislature has an approval rating of 27 percent, crawling toward its all-time low of 25 percent in a May 2010 Quinnipiac poll.

Only 11 percent of respondents said Pennsylvania's economy has improved since Corbett took office, but within that group, 66 percent gave him credit for the improvements.

Of the 33 percent who say the state's economy is in worse shape, 63 percent put the blame on Corbett over President Barack Obama.

Other points the poll found about where Pennsylvania voters stand on the presidential election included:

Obama leads presumptive GOP nominee Mitt Romney with 46 percent to 40 percent, alongside 2 percent who say they would vote for someone else and 3 percent who say they wouldn’t vote at all.
Forty-nine percent of voters say Mitt Romney would do a better job repairing the nation’s economy, compared with 41 percent who say the same about Obama.
Seventy-seven percent say Obama is a likeable person, compared with 58 percent who say the same about Romney

PA: Property tax elimination bill tabled in committee

PA Independent — Mon, 11 Jun 2012 22:30:30 +0000

Vote shows divides among parties

By Melissa Daniels | PA Independent

HARRISBURG — In 60 seconds, about 13 hours of committee debate and marathon public discussion ended with a whimper when lawmakers tabled Property Tax Independence Act on Monday.

The House Finance Committee voted 13 to 11 to table House Bill 1776. Sponsored by Rep. Jim Cox, R-Berks, the bill would eliminate a school district’s ability to levy a property tax, replacing that funding with an increase in sales and personal income taxes stateswide.

The vote to table means that Cox will have to get the committee to vote again, this time for further discussion. Until then, it's in legislative limbo, and it appears certain that the bill will not pass before the end of the current budget session.

A number of committee members supported the bill, but worried about the logistical and financial implications as written.

State Rep. Eli Evankovich, R- Armstrong, made the motion to table the bill, after indicating he was concerned about “passing a concept out of a committee” with a bill that still posed questions.

Cox said other bills with similar breadth of impact are never passed as written when they leave committee. No legislation, he said, is perfect, and House Bill 1776 is no different.

“The bigger issues we’ve tackled — Marcellus shale, the Delaware loophole, bills that are just huge in their impact — they came out of committee and what ended up going over to the Senate was vastly different,” Cox said following the vote. Cox was joined by four other Republicans in voting against tabling.

The vote to table did not follow party lines, reflecting a rare nonpartisan response to a tax issue.

Committee Chairwoman and state Rep. Phyllis Munday, D-Luzerne, one of six Democrats against tabling, said she supported the bill despite the fact she found it “deeply flawed” and crafted with “ambiguous language.” The burden of school property taxes and school funding are too big not to be discussed, she said.

“This issue must be resolved, and it must be resolved here at the state level, no more passing the buck,” she said. “(House Bill 1776) forces the discussion forward.”

The gravity of a multibillion-dollar tax shift required greater deliberation, said state Rep. Michael Peifer, R-Monroe, who added that he wanted to hear an expert opinion on the financial analysis.

“I have a difficult time understanding my own little district, but I really have concerns about the overall wellbeing of our commonwealth, and what this drastic change in tax policy will do to the commonwealth in general,” Peifer said.

One sticking point was a gap in how much the state’s Department of Revenue projected the new tax structure would raise compared with what districts would lose by removing property taxes. Department of Revenue projections put collections at $9.1 billion for the bill’s first year of operation, coming from a combination of increased revenue from higher personal income and sales taxes as well as additional taxes on a goods and services that are not subject to taxation.

Under the current system, property taxes generate some $12.5 billion annually from the state's 500 school districts.

Much of that gap, Cox said, would be made up by school districts retaining a portion of the property tax to pay outstanding debt until that debt was paid off. Compared to Department of Revenue estimates, it would leave a $900 million funding gap that could be made up with an increase in property taxes, Cox said.

Several representatives pushed for a financial analysis from the Independent Fiscal Office before passage. Cox said he still hopes to get that before the end of session.

State Rep. Kerry Benninghoff, R-Centre, said he’s open to have summer sessions to discuss the bill if it’s the will of the membership.

But, as one of the representatives who voted to table the bill, Benninghoff said he was wary of moving along a bill that still raised questions with no answers.

“The longer I sit through these hearings, the more questions I hear raised. It makes me really wonder where people are on the overall context,” Benninghoff said.

Cox said he was disappointed to see the bill stall, and he also pointed out that no members offered up amendments to the bill to make it better shape their concerns. Throughout the committee meeting, he said it was important to use the bill to open a broader discussion about school funding, and to deliver the questions to the leaders.

For the moment, Cox said he’ll still seek out information related to the funding structure and overall tax revenue. The issue is too important to drop.

“I’m not going to let it rest,” Cox said after the vote. “It’s not an issue that I can think can rest on any level. I think we’ve got to continue to move it forward.”

PA: Economic development program gets new name, stricter rules

PA Independent — Mon, 11 Jun 2012 20:40:13 +0000

Administration undertaking changes without legislation

By Eric Boehm | PA Independent

HARRISBURG — Pennsylvania government’s best-known economic development tool has a new name but the same old purpose — funneling taxpayer dollars to private developers.

State Budget Secretary Charles Zogby announced that the Redevelopment Assistance Capital Program — known as RACP but frequently called “R-Cap” — will be renamed the Pennsylvania Economic Growth Initiative.

The new name will coincide with what the Corbett administration promises will be a stricter, merit-based selection process for projects that focus public investments on projects with a “clear, positive economic impact” and a priority on creating jobs.

"These important changes are much more than just a new name for an old program; they reflect Gov. (Tom) Corbett's insistence on positioning Pennsylvania to better compete in a global economy," Zogby said.

Earlier this year, the Republican-controlled state House passed a bill placing many of the same controls on future RACP debt and requiring the program to reduce outstanding debt from $4 billion to $1.5 billion over the next 20 years.

The bill is awaiting action in the state Senate, though Majority Leader Dominic Pileggi, R-Chester, has professed support for it.

Steve Miskin, spokesman for House Majority Leader Mike Turzai, R-Allegheny, applauded the administration for tightening the rules on the program, but said it should be done legislatively.

"We do believe that you have to have the rule of law behind those changes to make them more permanent," Miskin said.

When RACP was created in 1986, it had a debt ceiling of $450 million. The current limit is slightly more than $4 billion, the result of politicians voting multiple times to increase it. The increases have come during both Democratic and Republican control of state government.

The changes announced by Zogby on Friday will limit the PEGI program debt to $125 million annually.

"This newly improved program will allow us to retire old debt instead of saddling it onto our children," Zogby said.

Nathan Benefield, research director for the Commonwealth Foundation, a free-market think tank here, said the program should be eliminated entirely after leaving taxpayers on the hook for billions of dollars in corporate welfare.

“Nonetheless, Corbett's proposal is a significant improvement — preventing many of the politically driven RACP projects we’ve seen in the past while slowing the growth of state government debt,” he said.

The name change comes as the Corbett administration faces criticism from all sides about what is potentially the largest economic development project the state has ever undertaken.

In an attempt to land an ethane cracker — a plant that turns natural gas into plastics and other materials — in Beaver County, the administration has promised Shell Co. more than $2 billion over 25 years. If the company chooses to locate in Pennsylvania, it could mean 20,000 jobs, according to administration estimates.

The cracker is not being paid for with RACP funding, but it has become a sticky subject for Corbett because it is closely related to the principle of RACP – using taxpayer funds for economic development.

On Monday, Corbett said the project was a “game-changer” and defended the annual cost of the tax breaks, most of which would go to other companies using the products created by the plant.

PA: Tax credit school choice plan may replace vouchers

PA Independent — Mon, 11 Jun 2012 20:28:23 +0000

School choice plan prepared in House GOP caucus

By Eric Boehm | PA Independent

HARRISBURG — A bipartisan group of Pennsylvania lawmakers are planning for a final push that could give about 30,000 students a way out of the state’s poorest performing school districts.

State Rep. Jim Christiana, R-Allegheny, plans to introduce legislation Tuesday that would create a business tax credit program to fund scholarships for students in the 15 percent worst performing school districts. (Click here to read a memo outlining the proposal)

The plan would mirror the Education Improvement Tax Credit program, which directs business contributions to scholarship accounts for students from families who make less than $75,000 annually.

The new plan would be called the Education Improvement Scholarship Credit.

“It’s an attractive program for those who want to get students out of violent, failing schools,” Christiana said.

He warned that the bill could change after House Republican leadership signed onto the plan.

Gov. Tom Corbett and Senate Republicans spent most of last year pressing for a voucher program that would direct some state tax dollars from public schools to scholarships for low-income students in failing schools.

The plan passed the state Senate in October, but did not receive much traction in the state House.

Christiana said the tax credit proposal — in which businesses would contribute to scholarship accounts and be rewarded with a partial tax break — has advantages over the voucher plan.

“It gets rid of some of the concerns about taking dollars out of the public schools in a year when the education budget is flat-funded,” he said.

The state House passed a measure to expand funding to the EITC last year with more than 190 members voting for it, an overwhelming show of bipartisan support for the program.

That bill awaits action in the state Senate, where the Republican majority would prefer to pair it with a voucher plan.

But this latest plan might not face smooth sailing.

Bill Patton, spokesman for House Democrats, said the real issue for many members was the Corbett administration’s decision to reduce funding to basic education.

“The real solution is proper funding of public schools and not experimental voucher plans,” he said.

The budget bill passed by the state Senate included $100 million for financially struggling school districts. It’s unclear how that would change if the state House approved $100 million for Christiana’s proposed program.

Proponents of school choice in the Legislature said the new proposal would accomplish the same goals as vouchers via different means.

“This is just the beginning, because the reality is that the status quo sucks and anyone who is going to argue for doing nothing has to own that fact,” said state Rep. Tony Payton, D-Philadelphia, a cosponsor of the plan and a proponent of school choice.

“It’s going to have an immediate impact on the kids in those schools,” said Anastasia Przybylski, a pro-voucher lobbyist for FreedomWorks who hails from Bucks County.

Earlier in the day, Corbett said he wanted to see three education reforms included in the upcoming budget deal: teacher evaluations, charter school reforms and special education funding.

PA: New district maps moving to Supreme Court

PA Independent — Fri, 08 Jun 2012 22:42:40 +0000

Plans show reduction of county, municipal splits

By Melissa Daniels | PA Independent

HARRISBURG — Pennsylvania voters are closer to learning who they can vote for.

The Legislative Reapportionment Commission on Friday voted 4-1 for a set of legislative maps that will go to the Supreme Court for approval.

This past winter, the state Supreme Court rejected the commission's plan and gave additional guidelines for drawing the lines.

Now, the commission must wait.

House Majority Leader Mike Turzai, R-Allegheny, said he's confident the House map should meet expectations.

"I think the past decision, given the existing court precedent, was wrong, but I've done my job, and the commission has done its job, and I feel quite strongly that we are well within the bounds of constitutional precedent," Turzai said.

In addition to Turzai, the commission consists of Senate Majority Leader Dominic Pileggi, R-Chester; Senate Minority Leader Jay Costa, D-Allegheny; House Minority Leader Frank Dermody, D-Allegheny; and retired Superior Court Judge Stephen McEwen, who was appointed by the state Supreme Court as chairman.

At a previous public hearing, the maps were criticized for still having too many split municipalities, which was the same criticism behind the state Supreme Court's rejection of the initial maps.

Those concerns were addressed in recent revisions. In the House plan, the map shows a reduction of 40 municipal splits, down to 68 from 108 in the remanded plan. In the Senate map, the plan eliminates 19 city ward splits in Philadelphia alone.

Pileggi said the new Senate plan "minimizes the number of political subdivisions and makes districts more compact."

Now that the commission officially has approved the plan, the public has 30 days to file an appeal with the state Supreme Court, before justices will vote on final approval.

However, not all were satisfied with the proposed district lines, citing partisan interests. Costa introduced an amendment to redraw the Senate map in such a way that would eliminate 10 county splits, which was voted down 3-2.

“More importantly, as you look at this map, you will determine that they were all done and connected to enhancing Republican performance in Senate districts,” Costa said.

Costa, who was the lone vote in opposition to the plan, said he was “very disappointed” that maps were “back where it started.”

Dermody said the House map wasn't perfect, but it was constitutional, while addressing the "specific concerns the court expressed in its February opinion."

Amanda Holt, a Lehigh Valley piano teacher whose interest in redistricting resulted in a plan that supports the Supreme Court’s rejection, attended the commission’s meeting to see the results.

Holt said she’s not sure if she’ll be filing an appeal, but this round of maps, much like the last, doesn’t stick to the rules of the Constitution, which says population, compactness and contiguousness must dictate district lines.

“The standard here is the Constitution, not necessarily prior plans,” Holt said.

Week in Review: PA unemployment fix, property tax plans push forward

PA Independent — Fri, 08 Jun 2012 17:26:57 +0000

Lawmaker seek to fix unemployment fund

By Staff Reports | PA Independent

HARRISBURG — This week, as Pennsylvania legislators and the governor's office continued to work on budget talks, a number of issues were pushed forward on and off the floor.

Looking ahead to next week, there's potential for hot debate over not only budget line items and an agreement on a spending cap, but also a plan to eliminate school property taxes for residents statewide.

PA to borrow $4.5B to pay off fed unemployment debt, change eligibility

Pennsylvania plans to borrow a $4.5 billion bond to help pay off debt from the federal Unemployment Trust Fund, which stands about $3.9 billion.

Both chambers this week passed Senate Bill 1310, sponsored by state Sen. John Gordner, R-Columbia.

The bond will allow the state's unemployment fund to be solvent by 2019, with the bond paid off the following year. Over the next seven years, the bill is expected to net $2.3 billion savings.

To further address the long-term solvency of this safety net, the bill includes changes to eligibility that will save an estimated $276 million annually.

State Rep. Stephen Bloom, R-Cumberland, praised the bill for its sweeping reform.

“If we ignore this problem, our (unemployment compensation) system will soon be completely exhausted, saddling hardworking taxpayers with an even bigger debt,” said Bloom in a statement.

However, Senate Minority Leader Jay Costa, D-Allegheny, said the plan is not a step in the right direction, and kicks the problem down the road. And, he said, since unemployment costs are shared, employees will see a shift in paying for unemployment compensation.

School supporters push for funding as PA lawmakers negotiate

This week, demonstrators came to the statehouse from the Upper Darby School District, where the Save UD Arts campaign has rallied against plans to cut music and arts programs to help meet a $13 million budget gap.

As lawmakers and the governor’s office negotiate the 2012-13 fiscal budget, public education funding has gone up and down in the General Assembly.

State Rep. Nick Micozzie, D-Delaware, along with several other representatives, spoke to the crowd about the education budget cuts. Earlier in the week a budget amendment, supported by Micozzie and state Rep. Margo Davidson, D-Delaware, passed in the House, restoring Accountability Block Grant money to its current level of $100 million. Gov. Tom Corbett’s budget didn't include the grant, and the Senate restored $50 million of that as part of a $500 million increase in the overall budget.

Accountability Block Grants help fund kindergarten and pre-kindergarten programs and cushion district budgets. Micozzie said if the grant funding sticks through negotiations, it would restore $725,000 to the Upper Darby districts, which had a $13 million shortfall this year.

Also still being debated is proposed funding for distressed schools, which the Senate set at $50 million in its budget proposal. But school supporters are adamant in pushing for more funding.

“We’re not going to lose our foundations, and we’re certainly not willing to sever the ties our children make with their teachers,” Save UD Arts parent coordinator Rachel Ruitberg told the crowd.

Click to watch the video from the rally on YouTube.

State, counties come to human services block grant agreement

Lt. Gov. Jim Cawley announced Tuesday that the Corbett administration and officials from the County Commissioners Association of Pennsylvania agreed on how to implement the Human Services Development Fund.

The plan is expected to streamline the distribution of grant money for health services. But some believe the plan will harm the efforts of service providers for the social safety net.

Officials aim to roll out the program as soon as July 1.

As proposed by Corbett in this year's budget, the block grant program would funnel $754.7 million from seven different welfare programs — including mental health services, behavioral health services and homeless assistance — into one grant. This concept, opponents say, could harm those who are most vulnerable by redirecting funds they need.

In addition, the state stands to save $168.4 million with proposed 20 percent cuts to overall grant funding. The administration, legislators and county officials are negotiating the actual amount to be saved, said Cawley.

“Families with an autistic child, or a person struggling with an addiction, we need to be there for them,” Cawley said Tuesday during a news conference at the statehouse. “But that harsh reality is coupled with yet another harsh reality, and it is simply this — we can no longer spend money we don’t have. We’re still recovering from this recession.”

PSEA sending $21K to Wisconsin as part of recall effort

Before Gov. Scott Walker’s historic victory on the Wisconsin recall election, union dues from Pennsylvania public school teachers were part of the funds used to help support his opponent.

Pennsylvania State Education Association gave $21,000 worth in-kind contributions on May 31 to political action committee We Are Wisconsin, which was running attack ads against Walker. The group also coordinated on-the-ground voting efforts in the state in support of Walker's Democratic opponent, Milwaukee Mayor Tom Barrett.

In-kind contributions can be anything of value that is not a direct donation of cash.

The PSEA did not return requests for comment about the nature of the contribution, but the union published a newsletter in April tying the situation in Wisconsin to Corbett's education policy.

Property tax elimination to be voted on next week

The House Finance Committee on Monday held a second public hearing on House Bill 1776, or the Property Tax Independence Act.

The bill, sponsored by state Rep. Jim Cox, R-Berks, aims to achieve the long-discussed goal of eliminating property taxes to fund public schools by increasing sales and personal income taxes, as well as taxing previously untaxed goods and services.

The committee is scheduled to vote on the act Monday.

But new figures from the state Department of Revenue show a $3.5 billion gap between the estimated $12.5 billion earned by property taxes, and what the new tax structure would raise. In response, Cox said he and bill co-sponsors would consider increasing the personal income tax even further to meet the mark.

Cox said eliminating property taxes isn’t about sticking school districts with a shortfall. Revenue neutrality is the goal, he said, though he doubted the $3.5 billion figure.

"We’re in agreement the personal income tax is the place we would need to look to fill that void,” Cox said.

House approves Mackenzie parking meter inspection legislation

This week the state House passed a bill sponsored by state Rep. Ryan Mackenzie, R-Berks, to turn over parking meter inspections to local municipalities instead of the state Department of Agriculture’s Weights and Measures Division.

“This is commonsense legislation, which will help to streamline state government and improve the inspection operations of PDA,” said Mackenzie in a statement “This transfer will allow the department to focus on its other inspections and will provide more time for local governments to verify the accuracy of the timing devices in parking meters.”

Under the bill, local officials would check meters for accuracy at least once every five years.The state inspects the meters every three years. Only certified parking meter inspectors who’ve undergone a training program outlined by the Department of Agriculture would be permitted to check the meters.

PA to borrow $4.5B to pay off fed unemployment debt, change eligibility

PA Independent — Thu, 07 Jun 2012 21:35:27 +0000

Payoff helps employers save

By Melissa Daniels | PA Independent

HARRISBURG — Pennsylvania plans to borrow a $4.5 billion bond to help pay off debt from the federal Unemployment Trust Fund, which stands about $3.9 billion, the third highest in the nation.

But legislators were divided over who would benefit from this bill: employers, employees or both?

Both chambers this week passed Senate Bill 1310, sponsored by state Sen. John Gordner, R-Columbia, a move that will save Pennsylvania anywhere from $175 to $200 million in annual interest payments and prevent it from borrowing federal dollars.

Gordner explained that the amount was larger than the debt to help ensure the state won't have to begin borrowing again. That, combined with other provisions, means "for decades to come, this fund will be solvent,” he said.

The bond will allow the state's unemployment fund to be solvent by 2019, with the bond paid off the following year. Over the next seven years, the bill is expected to net $2.3 billion savings.

To further address the long-term solvency of this safety net, the bill includes changes to eligibility that will save an estimated $276 million annually.

Gordner said the last major attack on the unemployment system was in 1988.

Proponents of the bill say paying off the federal debt will help employers and employees alike.

Eliminating the federal debt removes an interest surcharge employers must pay that’s scheduled to cost billions over the next few years, while the interest rate on the bond is lower than the federal debt.

But changing the eligibility requirements would mean an estimated 48,000 workers will no longer be eligible for benefits, opponents to the bill said.

Estimates from Gordner’s office say the revised requirements won’t affect 90 percent of claimants. Changes to unemployment eligibility will not kick in until 2013, leaving present claimants unaffected.

As the federal debt soared, employers were paying more as the interest rate on the fund brought higher costs, which kicked in this year, Gordner said.

In 2013, the total bill from that interest rate would be $220 million, and $330 million the year after that. In seven years, that charge would total an estimated $4.1 billion.

That charge comes out to $21 per worker this year, doubling annually along with the rate, said Kevin Shivers, president of the Pennsylvania chapter of small business advocacy group National Federation of Independent Businesses. The charge, he added, is a disincentive for hiring while possibly causing businesses to lay off employees.

But Senate Bill 1310 will eliminate that charge. And the interest rate on the bond will be less than the interest on the federal loan.

Shivers said the short- and long-term savings achieved through the legislation helps employers and employees alike.

“This is a plan that helps employees; it helps claimants by fortifying it,” Shivers said. “It sends a message to businesses that we are going to develop a solution that’s responsible and we’re going to do it in a way that makes true business sense.”

But opponents see the changes as an attack on workers because the bill decreases the amount an employee can earn in one quarter before being eligible for unemployment.

Under current law, 63 percent of qualifying earnings can be earned in one quarter, with the balance made up in the other three. The bill lowers that threshold to 50.5 percent, effectively disallowing people who work the majority of the year in one season from collecting.

AFL-CIO President Rick Bloomingdale said in a statement that the bill is not a fair solution to fixing the unemployment system, as it shuts out people who may need unemployment after losing their job through no fault of their own.

“It’s time for businesses to step up and begin shouldering an equal share of the burden, not another free ride and big bailout on the backs of working families,” said Bloomingdale.

Despite the savings it’s expected to generate, the bill did not past quietly. The Senate passed it with a 29-19 vote, while the House responded with a 129-67 vote.

Senate Democrats proposed several changes to the bill, but all failed, including:

Reining in eligibility reforms to affect fewer employees,
Shifting distribution of employee contributions,
Requiring the bonds to be subject to auditor general and treasurer approval.

Senate Minority Leader Jay Costa, D-Allegheny, said the plan merely kicks the problem down the road.

“The plan would shift more of the cost onto workers and lessen the burden on businesses,” added Costa.

State Rep. Ron Miller, R – York, chairman of House Labor and Industry Committee, said the legislation was the best thing the Legislature could do to help the Pennsylvania business, and the Pennsylvania worker.

“This is a jobs bill,” Miller said. “We help employers; we help workers. We need to get people back to work in this economy, and anything we can do to spur that, we need to do now.”

Gov. Tom Corbett has not set a date to sign the bill, according to the administration press office.

School supporters push for funding as PA lawmakers negotiate

PA Independent — Wed, 06 Jun 2012 21:38:13 +0000

Upper Darby group protests at Capitol

By Melissa Daniels | PA Independent

HARRISBURG — Applause interrupted from Upper Darby School District parents, students and supporters when state Rep. Nick Micozzie said the House restored some education funding.

But the Delaware County Republican was quick to add that circumstances may changes as negotiations continue

“Here’s the fight,” Micozzie said during a rally Wednesday at the statehouse. “We have to convince the governor to approve what we send over.”

Micozzie was referring to the public education funding the General Assembly has added gradually to the governor's proposed budget. While the Pennsylvania Senate introduced adding $50 million for a grant program, the House doubled that to $100 million.

Micozzie, along with several other representatives, spoke to the crowd about the education budget cuts. The demonstrators came from the Upper Darby School District, where the Save UD Arts campaign has rallied against plans to cut music and arts programs.

The rally was a snapshot of some larger issues — public education funding when costs are increasing, and reaction from school districts on the trickle-down effect of decreased state and federal funding.

As lawmakers and the governor’s office negotiate the 2012-13 fiscal budget, public education funding has gone up and down in the General Assembly.

Tuesday, a budget amendment, supported by Micozzie and state Rep. Margo Davidson, D-Delaware, passed in the House, restoring Accountability Block Grant money to its current level of $100 million. Gov. Tom Corbett’s budget didn't include the grant, and the Senate restored $50 million of that as part of a $500 million increase in the overall budget.

Tim Eller, spokesman for the state Department of Education, has said the governor rolled funding for Accountability Block Grants into other line items that fund school districts. Doing so, Eller said, "allows for school districts to prioritize their funding into areas they believe best serve students in their local area."

In the 2010-11 budget, funding for the Accountability Block Grants was $254.5 million.

Also still being debated is proposed funding for distressed schools, which the Senate set at $50 million in its budget proposal. Davidson said the districts that would qualify for this money have not been identified.

Proposed funding levels for public education have triggered a belt-tightening in local districts, notably in Upper Darby, where potential cuts to the arts drew the attention of alumna and comedienne Tina Fey.

Fey emailed a YouTube video about Save UD Arts to her contacts, drawing extra attention to the issues at hand.

State Rep. James Roebuck Jr., D-Philadelphia, chairman of the House Education Committee, said saving arts programs amidst the cuts will help students succeed, especially those who struggle in other areas.

“When they’re involved in music and art, there’s a great leveling experience that puts all students at a point where they can demonstrate what they can do, demonstrate excellence and that enhances their ability to learn,” Roebuck said.

PA block grant plan: Step toward efficiency or burden to services

PA Independent — Tue, 05 Jun 2012 21:52:35 +0000

Program comes with potential service cuts

By Melissa Daniels | PA Independent

HARRISBURG — A plan to streamline the distribution of grant money for health services in Pennsylvania makes sense to some officials as a step toward efficiency, but others believe the plan will harm the efforts of service providers for the social safety net.

Lt. Gov. Jim Cawley announced Tuesday that the Corbett administration and officials from the County Commissioners Association of Pennsylvania agreed on how to implement the Human Services Development Fund. CCAP is a nonprofit, bipartisan organization representing counties statewide.

Officials aim to roll out the program as soon as July 1.

As proposed by Gov. Tom Corbett in this year's budget, the block grant program would funnel $754.7 million from seven different welfare programs — including mental health services, behavioral health services and homeless assistance — into one grant. This concept, opponents say, could harm those who are most vulnerable by redirecting funds they need.

In addition, the state stands to save $168.4 million with proposed 20 percent cuts to overall grant funding. The administration, legislators and county officials are still negotiating for the actual amount saved, said Cawley.

“Families with an autistic child, or a person struggling with an addiction, we need to be there for them,” Cawley said Tuesday during a press conference at the statehouse. “But that harsh reality is coupled with yet another harsh reality, and it is simply this — we can no longer spend money we don’t have. We’re still recovering from this recession.”

The block grant will let counties distribute money where they need it most, Cawley said.

“The current system is not very flexible at all, and it’s got a lot of rigid rules,” he said. “It forces counties to answer to multiple masters and it forces clients to separate services, rather than a unified, client-based approach.”

Berks County Commissioner Christian Leinbech, vice president of CCAP, referred to Reading as an example of how a municipality would benefit from the grant program. The distressed city will have different needs than rural Tioga County, Leinbech said.

Under the current system, counties must track and report spending in different categories. The block grant would remove those barriers, and let counties set their own priorities on human services spending.

“You could look at almost any of the last several years and find one category with a surplus and another category where we’re out of money,” Leinbech said.

Although legislation for the program is not available, counties can enter the program July 1 or have the program phased in over two years.

The program would include rates of funding specific areas for the first several years, but after that period, counties use the funding as they see fit.

Despite the program’s proposed July 1 start date, state Rep. Gene DiGirolamo, R-Bucks, wants to stop the block grant. He is supporting legislation on this issue, which the state House could address later this week.

While speaking to rallying groups outside the Capitol, DiGirolamo said the block grant program hurts those who are most vulnerable, and it’s too soon to support something with so few details.

“Let’s try a pilot program. I think that’s fair and that’s reasonable and that’s responsible. Not full speed ahead into this block grant,” he said.

Human service providers are finding consolidating funding means cuts in funding.

Hank Lipinski, director of development for Allegheny Family Network, said his organization of 28 employees helps families with children with behavioral health issues.

Allegheny County told his organization that it would have to cut its $2 million annual operating budget by 20 percent under the block grant program.

Lipinski said the organization may cut its staff to offset the lost funding, resulting in fewer families who have children with special needs receiving help. Without assistance, families may have the child taken away from them, he said.

“The irony of the cutback thing is it’s going to increase costs," Lipinski said.

Christine Michaels, executive director of National Alliance on Mental Illness Southwestern Pennsylvania, said the block grant program will pit special needs advocates against each other as they compete for the same funding.

To Michaels, the block grants mean less funding for services like treatment, housing support, drop-in facilities and psychiatric rehabilitation. Michaels added that the announcement blindsided organizations.

“We were never involved at all. There was no public input in any of this,” she said. “The county commissioners weren’t communicating.”