HARRISBURG (WSKG) — Thanks to months of behind-the-scenes negotiation, a significant pension bill is on a fast track through the state legislature. It easily passed the Senate Monday, though even its supporters acknowledge that it doesn’t come close to fully fixing Pennsylvania’s pension woes.
The commonwealth is carrying about $70 billion in unpaid pension debts, and the costs of paying it off have put significant strain on the state’s budget, as well as school districts’ spending plans.
The proposal now being considered wouldn’t reduce unfunded liability or pay it off more quickly.
It would, however, change the current pension structure to a tiered 401(k)-style plan, which benefits the state because if investment returns are bad, state employees would bear the financial strain–not the state itself.
Several senators, like Lackawanna County Democrat John Blake, spoke on the floor to lament the fact that the measure doesn’t generate any savings. Blake hadn’t voted for the bill when it was in committee, but ultimately opted to support it.
“We can’t wait around for the perfect if we could obtain some good,” he said.
Vocal champions of the plan, like Republican Senate Majority Leader Jake Corman, also said it’s not a fix-all–it’s slow progress.
“Some of our critics will say this bill doesn’t save any money right now. And you know what, Mr. President? They’re correct,” Corman said on the floor. “But if people were forward-looking back in 2001, we wouldn’t be in this situation we’re in today.”
The redesigned plans would only apply to new hires, and would be less lucrative than traditional pensions.
A spokesman for the House says the bill is likely to fare well there, and Governor Tom Wolf has said he supports it too.