Harrisburg – May 13, 2015 – Senate Democratic Leader Jay Costa (D-Allegheny) said that the Senate Republican pension reform plan that passed the Senate today (Senate Bill 1) is illegal because it impacts benefits of current employees, is woefully short-sighted, and unfair to workers.
Costa challenged Senate Republicans in floor debate to reconcile well-established law with the proposal. He said that the plan would be immediately challenged in court, cause a litigation explosion and compel taxpayers to cover back benefits.
The Democratic leader said that the Republicans abused the process in rushing the measure to the Senate floor for a vote. Plus, he said that both Senate Democrats and Gov. Tom Wolf have offered responsible, constructive, constitutional proposals that would address high public pension costs reasonably.
Costa said the plan provided little relief even if the bill overcomes legal hurdles. The projected savings for the teachers’ retirement system would be $3.1 billion and $600 million for the state employees system.
He said the measure does not address the unfunded liability in the pension funds that spiked because Pennsylvania failed to make its actuarially required contribution for 17 years. Eighty-eight percent of current costs of the state worker and teacher retirement funds are to pay off the unfunded liability. The plan adds a cash-balance plan for new hires but uses contributions from new hires into the fund to pay retirement benefits for others.
Costa’s comments follow:
“Senate Democrats believe that there are responsible pension reform plans that protect taxpayers and provide reasonable benefits for workers but the Senate Republican plan does neither, plus it is unconstitutional. The Republican plan hurts current workers, devastates pension benefits for future employees and provides little in the way for relief for taxpayers.
“The plan puts new employees and future retirees into poverty and makes changes in public pension systems that are unreasonable. The process that was used to pass this plan was flawed and rushed and the plan itself falls woefully short of any reasonable tests of legality or fairness.”
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Contact: Stacey Witalec
Telephone: 717 877-2997
Email: switalec@pasenate.com
Harrisburg – May 13, 2015 – A leading group of Senate Democrats today wrote to the Public Employee Retirement Commission (PERC) to express grave concerns about the process surrounding Senate Bill 1, a massive overhaul of the pension system for public employees.
PERC itself raised red flags about the expedited legislative schedule, which rendered them unable to fully examine the proposal.
Milliman, the actuarial firm hired by the commission to review Senate Bill 1, included the following note in their analysis:
“Due to time constraints dictated by the Commission for providing this actuarial note, we are providing this letter without a complete review of all facets of the legislation nor all actuarial cost projection information used by the system actuaries in their analyses.”
Senate Democratic Leader Jay Costa (D-Allegheny) joined with Democratic Appropriations Chairman Vincent Hughes (D-Philadelphia), and Democratic Finance Chairman John Blake (D-Lackawanna) to call on PERC to use the authority granted to it to provide recommendations to the General Assembly to improve transparency and provide a timeline when considering legislation related to public pensions.
“Senate Republicans have abandoned the principals of an open and transparent government to ram through an illegal bill that could radically diminish retirement benefits for hundreds of thousands of state and school district workers,” said Sen. Costa. “We need to identify a better process than considering a 410-page bill with only 72 hours notice.”
The timeline for Senate Bill 1 has been extremely rushed, lawmaker said.
There was a hastily called Finance Committee meeting on Monday, May 11, where the bill passed along party lines. Senate Bill 1 was then considered by both PERC and the Senate Appropriations Committee meeting on Tuesday, May 12.
“It now appears that this bill—which legal observers believe is unconstitutional and illegal—may be voted on final passage today,” said Sen. Hughes. “It’s simply unconscionable to consider something of this magnitude on such a fast timeline. When you have Milliman acknowledging problems with the process, that should be enough to stop the wheels of destruction from moving forward.”
PERC was created to ensure that lawmakers can make informed decisions about pension legislation. That is why Senate Democrats have called on the commission to make recommendations to the General Assembly on how to guarantee that future legislation is considered in a more transparent manner.
“We have an obligation to the public to fully consider all legislation, especially something as complicated as pension reform,” said Sen. Blake. “I hope that PERC will respond to our request and create a process worthy of the importance and consequences of any legislation affecting our public pension systems.”
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Contact: Stacey Witalec
Telephone: 717 877-2997
Email: switalec@pasenate.com
View Letter to PERC →
View Letter to Senate Republicans →
Harrisburg – May 12, 2015 – Senate Democratic Leader Jay Costa (D-Allegheny) said today that he strongly supports legislation that legalizes the use of cannabis extracts to address certain medical conditions, including seizures, cancer, diabetes and chronic pain.
Costa released the following statement after today’s Senate vote. Senate Bill 3 passed the Senate by a vote of 40-7. The bill now goes to the state House of Representatives for consideration.
Sen. Costa’s comments:
“The legislation that legalizes the use of cannabis extracts to help those who are suffering from chronic pain, seizures, cancer, diabetes and other serious medical conditions is good news for patients, families and the medical community.
“For too long, patients and families dealt with pain and serious medical issues without being allowed to access medical cannabis to relieve suffering. Over the years, a litany of families, patients and medical personnel provided testimony about the usefulness of cannabis extracts as a means to relieve pain and anguish.
“The Medical Cannabis Act is a good, positive development that was crafted carefully to ensure that proper protections are in place and that the access is tightly regulated. The bill’s prime sponsors, Sens. Daylin Leach and Mike Folmer, have done a wonderful job in designing a measure that is balanced and responsible.
“With so many families-in-need waiting for relief for their loved ones through medical cannabis, today’s Senate vote is an encouraging step in the right direction. I look forward to the swift consideration and passage of this bill in the House.”
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Harrisburg – May 12, 2015 – After a recent series of accidents in construction zones, a bipartisan group of senators and state officials detailed legislation today that’s designed to protect workers in the zones.
Senate Democratic Leader Jay Costa (D-Allegheny) was joined by Sens. Judy Schwank (D-Berks), David Argall (R-Schuylkill), and Camera Bartolotta (R-Washington) in addition to PennDOT Secretary Leslie Richards and Pennsylvania Turnpike Commission Chair Sean Logan to discuss how the measures will improve safety in the construction zones.
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The senators and state officials outlined their plan for increased penalties for those striking or killing highway employees and first responders in construction zones.
“Far too often vulnerable workers and first responders in construction zones are ignored by motorists focused on getting to their destination instead of heeding safety protocols,” Costa said. “We have to remember that these are not just employees reporting to work each day – they are somebody’s mother, father sibling or friend.
“They each deserve the opportunity to leave work as safely as they arrived.”
The bills offered by Costa and Bartolotta would increase fines and penalties by $1,000 for minor violations and $5,000 for more serious offenses involving highway workers or first responders, plus a six month drivers license suspension.
“Too many construction workers have been sent to the hospital in recent weeks and too many turnpike employees killed over the years by speed and distraction in work zones,” Logan said. “Motorists simply aren’t getting the message.
“The enforcement tools we have at our disposal today are not making enough of an impact.”
Bartolotta reflected on the impact of careless driving in many incidents and stressed the need for drivers to remain aware in their travels.
“We owe it to all of these workers and their families to do our part to protect them against reckless, irresponsible and distracted drivers,” she said.
With a focus on increased safety measures in work zones, legislation introduced by Schwank and Argall would provide speed cameras in active work zones on limited access highways.
“Families of the men and women who work to improve our roads can’t wonder if their moms or dads are going to return home from work every day,” Schwank said. “Drivers must know that if they go too fast through a construction zone they will be hit in the wallet with a stiff fine,” Schwank said.
“The recent tragedy on the Pennsylvania Turnpike near Bensalem reminds us that, as more state dollars are invested in improving our infrastructure, the problem facing our construction workers will only grow more dangerous,” Argall said.
Ensuring that work zones are safe places is a top priority for PennDOT, according to Pennsylvania Transportation Secretary Leslie S. Richards.
“Since 1970, 85 PennDOT workers have been killed in the line of duty,” Richards said. “Our workers want to see their families at the end of their work days. Work zone safety awareness is essential, for your safety and ours.”
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HARRISBURG, April 9, 2015 – A bipartisan group of state legislators from western Pennsylvania released the following statement today in response to the announcement that UPMC does not intend to renew the Medicare Advantage contract with Highmark customers:
“UPMC has broken its promise to seniors in western Pennsylvania. They made a promise to our seniors, and now they are purposely using our seniors to create leverage against Highmark to gain an advantage in a financial dispute. Their actions are unconscionable. UPMC was warned by the Attorney General, Insurance Commissioner and Secretary of Health that such tactics would constitute a breach of the carefully crafted consent decree. They disregarded that finding and are now sticking it to our seniors. Totally unacceptable,” said Senate Democratic Leader Jay Costa, D-Allegheny.
Rep. Jim Christiana, R-Beaver, said, “It’s truly unfortunate that the devious scare tactics and anti-patient behavior continue, this time at the expense of some of our most vulnerable citizens. UPMC is now threatening to hold hundreds of thousands of Highmark Medicare Advantage customers as hostages just to gain some legal standing. Rest assured, we will be monitoring this developing issue and will support our seniors in any way we can.”
House Democratic Caucus Chairman Dan Frankel, D-Allegheny, said, “The communities that I represent are tired of being held hostage by the actions of UPMC, which continues to engage in practices that clearly call into question its profit-driven motives and its status as purely public charity. The cancellation of the Medicare Advantage contract threatens to leave 180,000 seniors without access to their health care providers. I am committed to working with my colleagues and Governor Wolf to finally bring much-needed clarity and certainty to this dispute.”
Sen. Randy Vulakovich, R-Allegheny, said, “UPMC should quickly move to reinstate this contract so that seniors in Western Pennsylvania are not placed in the middle of this ugly, ongoing dispute. This behavior is totally unacceptable and has gone on far too long, causing mass confusion amongst my constituents and shedding a negative light on the region in general.”
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MEDIA CONTACTS:
Rep. Frankel: Ben Turner
717-787-7895, bturner@pahouse.net
Sen. Costa: Stacey Witalec
717-772-2368, switalec@pasenate.com
Sen. Vulakovich: Melissa Farabaugh
717-787-6538, mfarabaugh@pasen.gov
Rep. Christiana: Abbey Haslam
717-260-6222, ahaslam@pahousegop.com
Plan includes historic tax relief, business tax shifts, education, and job initiatives
Harrisburg – March 3, 2015 – Senate Democratic leaders today said that Gov. Tom Wolf’s first budget proposal is a “bold, responsible and necessary” plan designed to address issues confronted by middle class families and it is so compelling that it will command the full attention of lawmakers.
The spending plan was detailed by the governor today before a joint session of the General Assembly.
“The governor deserves credit for proposing an aggressive approach aimed at solving Pennsylvania’s most pressing problems,” Senate Democratic Leader Sen. Jay Costa (D-Allegheny) said about the $29.88 billion spending plan. “It is bold; it is responsible; and, it is necessary in light of the structural deficit that exceeds $2 billion, the gaping education funding hole and jobs deficit that Pennsylvania faces.
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“This is not a plan built on gimmicks – it is an honest, substantial plan that comes with tough policy choices and revenue options that lawmakers will have to carefully weigh.”
The plan calls for $3.8 billion in property tax relief, $1 billion in education investments, $1.675 billion for job creation and restoration of social safety net program dollars all within the context of a modest 2.7 percent increase over the current year budget.
“This is not an incremental budget; it’s a transformational budget and a marked departure from the flim-flam sham budgets of the Corbett years,” said state Sen. Vincent J. Hughes, Democratic chair of the Senate Appropriations Committee. “This is a significant proposal that includes welcomed and long-overdue policy initiatives in education, health care, jobs and fiscal management.
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“We are at the start of the budget process, but the governor has laid down a big bet and a significant marker. Passivity and knee-jerk negativity should be checked at the door when negotiations begin in earnest.”
The new initiatives are paid for by adjustments in the Personal Income Tax, Sales and Use Tax, the imposition of a new gas severance tax, the elimination of tax exemptions and new efficiencies. It also includes tax shifts aimed at helping business such as a slashing of the Corporate Net Income tax and eliminates the Capital Stock and Franchise tax. The governor also called for an increase in the minimum wage to $10.10 per hour.
Hughes said that if the plan is adopted it will immediately change the direction of Pennsylvania and make critical investments. He said the plan has the potential to jump-start job creation, education achievement and health-care choices while restructuring the tax menu for individuals and business.
Costa said that the $3.8 billion in property tax relief coupled with $1 billion more for schools is “historic” and will push Pennsylvania past 50 percent in funding local school costs. The expected average tax relief for property taxpayers will exceed $1,000 per homestead and that the average homeowner will see their tax bill reduced by 50 percent.
“For years, citizens have asked for property tax relief, business leaders have called for cutting the corporate net income tax and schools officials have had to deal with deep cuts in school funding that have resulted in local tax increases, job loss or program elimination,” Costa said. “This budget addresses all those concerns.”
The Democratic leader said that while the plan is bold, it does come with costs and tax changes that must be evaluated in their proper context before final decisions are made.
“The governor’s plan invests in schools, relieves tax burdens, helps businesses and makes critical investments that have been found wanting over the last several years,” Hughes said.
Hughes said that the new $1 billion in education will replace dollars lost to deep Corbett-era cuts. He said that the new spending plan includes $120 million for pre-kindergarten and Head Start, $140 million more for higher education, cyber-charter reforms and a commitment to utilize a new basic education funding formula now being developed by an independent commission.
The Democratic appropriations chair said that many of the pieces of the governor’s plan have been sought by Senate Democrats through their “PA Works” plan and other initiatives.
“The governor has outlined policy proposals that would responsibly invest $1.675 billion in job creation programs,” Hughes said. “Using already approved bond authorization to fund transportation or water and sewer projects makes sense.”
Costa said that he is pleased that the governor has proposed using efficiencies to help balance the books and that his proposal to merge the Department of Corrections with Probation and Parole, transition to traditional Medicaid expansion and phase-in Medicaid long-term care will free up more dollars for even greater investments. The boldness of the plan should be of no surprise to anyone who followed the governor’s thinking, he said.
Wolf proposed using revenues generated from combined reporting to reduce the CNI to 5.99 percent on Jan. 1, 2016 and to 4.99 percent in Jan. 2018 from its current 9.99 percent. His plan calls for increasing the PIT from 3.07 to 3.7 percent and the sales tax from 6 to 6.6 percent plus closing a laundry list of exemptions, but not touching food, clothing or prescription drugs. The plan also calls for reconciling the state’s sales tax rate with Philadelphia’s local sales tax for schools so that the effective rate of the increase will remain uniform.
The budget plan will now be closely reviewed during upcoming hearings by the Senate Appropriations Committee. The deadline to adopt a budget is June 30.
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