As if Pennsylvania lawmakers did not have enough to worry about with the fate of the state budget, Gov. Tom Corbett has tossed another hurdle in front of the General Assembly. The Pittsburgh Business Times reports the governor has made pension reform a priority heading into the home stretch of the budgeting process. But according to Fox News 43, Harrisburg leaders still have a lot of negotiating to do without the added stress of pension reform heading into a June 30 deadline for a new spending plan.
How far apart is the General Assembly and Gov. Corbett on spending?
Fox News 43 indicates the sides are about $500 million apart on a spending plan, which means a fair amount of deal making is on tap for the next few weeks. Among the costs under scrutiny is funding to higher education, which the legislature wants to restore but the governor wants to cut.
How bad is the pension fund?
According to the Pittsburgh Post-Gazette, the state pension funds were $37 billion short as of the last fiscal year regarding the amount of benefits earned by employees vs. the amount of assets Pennsylvania has available to pay. The governor wants legislators to identify some solutions to close the gap.
Will college tuition increase as a result of the budget?
According to the Associated Press and WJAC News, the fate of any increase in tuition costs rests on the shoulders of the budget agreement that is struck. Should Gov. Corbett and State House and Senate leaders find some middle ground, the potential tuition increases will not be as bad. But if funding is eliminated on par with the governor's plan, students and parents can count on another round of major hikes at just about every educational institution in the state.
What solutions are circulating to solve the pension crisis?
The governor has been quiet as to any viable long-term solution to funding pensions for state employees, teachers and other public workers, but the article also indicates the governor favors a transition to a worker funded 401(k) type of retirement plan. The Pittsburgh Post-Gazette highlights a plan that would impose a $2 per person entry fee to all state casinos, which would send the bulk of the raised funds to cover the state pension system.
Jason Gallagher is a longtime Pennsylvania resident. He has experiences in trends and developments in many regions from having lived in many parts of the Keystone State, and currently resides in the Pittsburgh area.
