Sen. Blake: New Pension Reform Law Only Starts Correction

HARRISBURG, June 12, 2017 – State Sen. John Blake (D-Lackawanna/Luzerne/Monroe) today released the following statement regarding the state pension systems reform contained in Senate Bill 1 that was signed into law by Governor Tom Wolf this afternoon.

“I commend my colleagues in the legislature and Governor Wolf for the bipartisan work done to facilitate a five-party agreement for significant pension reform.  Senate Bill 1 starts the correction of our broken pension systems and begins to shift risk off of taxpayers by introducing the public sector equivalent of a 401k for future employee benefits, but it does not go far enough.”

 

“Senate Bill 1 does not affect existing employees or those already receiving a state pension and it does not add to our unfunded liability.  There are, however, reform proposals that could have had much greater, immediate and long-term impact than the $1.4 billion savings over 30 years projected for Senate Bill 1.  There are also near-term costs associated with the implementation of Senate Bill 1 and none of the projected savings will begin to be realized for another 20 years.”

“As the Democratic Chair of the Senate Finance Committee, I remain disappointed that many other good ideas which could have had a much more substantive impact on our Commonwealth’s finances – both with respect to our General Fund deficit and our daunting unfunded pension liabilities – were not adequately considered in the debate on this particular bill.  This pension reform is only the start of the correction.  We cannot consider our work concluded unless and until we seriously begin to address the $70 billion in unfunded liability and find ways to provide relief to our school districts whose budgets continue to be overwhelmed by these legacy costs.”

Video of Senator Blake’s floor remarks on Senate Bill 1 are available at the following link:   https://www.youtube.com/watch?v=riWNBPZPj_E

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Blake Discusses State Budget, Education Funding and Pension Reform at Annual Legislative Breakfast

SCRANTON, February 12, 2016 – State Sen. John Blake (D-Lackawanna/Luzerne/Monroe) today hosted nearly 100 local and municipal officials at the Hilton Hotel and Conference Center in Scranton for his sixth annual legislative breakfast.

In the wake of the governor’s 2016-17 budget address coupled with the fiscal uncertainties created by the over $6 billion in line-item vetoes from the 2015-16 state budget, Senator Blake spent much of the time describing the stark realities facing the Commonwealth.

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“We have to be more responsible about our fiscal and budgetary obligations as a legislature,” Blake said. “The underfunded, incomplete budget that we are currently operating under is not only $6 billion short of the needs of our schools, hospitals and citizens – but according to some estimates, nearly $500 million out of balance.”

LegislativeBreakfast1On Tuesday, Governor Tom Wolf proposed a $33.288 billion state budget for 2016-17 which was built on the assumption that the bipartisan agreement negotiated in December will ultimately be enacted. The agreement which was not enacted in the House after it passed the Senate by a 43-7 vote would have included a nearly $500 million increase in public education funding; elimination of our structural budget deficit; $78 million in new funding for higher education; and fully funded pension and debt obligations.

“The governor’s 2016-17 budget is focused on two things: education funding and addressing the Commonwealth’s budget deficit. These are certainly priorities for Pennsylvania, but we also must find a consensus and an end to the sharp political division within the Capitol,” Blake said. “When the governor signed the budget and blue-line vetoed $6 billion – we lost a lot of leverage towards getting the 2015-16 bipartisan agreement enacted and it is my belief that it is time for us to address the remaining appropriation for 2015-16 so we can pivot to the 2016-17 budget negotiation.”

IMG_6883Blake also discussed the numerous state pension reform proposals that were proposed in the past year and which were a part of the 2015-16 budget compromise reached in December.

“The pension reform plan that passed in the Senate was not a perfect plan. It would, however, have enabled a responsible, balanced budget that included the largest education funding increase in Pennsylvania history; tens of millions of dollars to restore past cuts to human services and economic development programs; and it would have eliminated the structural deficit we are faced with in this and the next fiscal year,” Blake said.

Another issue discussed at the legislative breakfast was property tax relief.

“Any discussion about taxes to address our structural deficit has to include a discussion about property tax relief,” Blake added.

There are numerous proposals circulating the Capitol on property tax relief including a proposal by the Senate Democratic Caucus. This plan would provide significant property tax relief through rebates to homeowners of up to $1,990 annually as well as $500 rebates to renters earning less than $50,000 annually. The plan would eliminate school property taxes for 2 million homeowners across the state and significantly reduce the local property tax burden for an additional 1.2 million homeowners.

Blake, who serves as the Democratic Vice Chairman of the Senate Appropriations Committee, said that the Senate will return to Harrisburg later this month for a full slate of budget hearings on the governor’s 2016-17 budget proposal and, hopefully, to deal with the budget crisis that continues to threaten our schools and our hospitals as a result of the work undone on the 2015-16 state budget.

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Blake: Stopgap Budget Continues Past Cuts, Reduces Funding Levels for Schools

HARRISBURG, September 18, 2015 – State Sen. John Blake (D-Lackawanna/Luzerne/Monroe) today released the following statement regarding the Senate party-line passage of the Republican-crafted stopgap budget:

“The Republican-crafted stopgap budget presented for a vote today in the Senate is basically one-third of the flawed and irresponsible budget that the Republican majority passed in June which was properly and swiftly vetoed by Governor Tom Wolf. One third of that budget is not an improvement or a solution. Further, it locks in past cuts and ignores the significant stress being felt by our school districts, our human service providers and our taxpayers. The stopgap budget plan passed by Senate Republicans today all but ensures reduced funding levels for our schools and human service agencies going forward.”

“Since June, I have met with dozens of business managers, superintendents, and directors of our nonprofit and health care systems throughout the 22nd Senate district – all of whom are experiencing significant fiscal distress directly because Republican leadership will not agree to negotiate an honest, balanced and complete state budget. Those conversations, and the real pain being felt by our schools and our service providers made this a very difficult vote – but I know that for whatever short-term relief this plan promises, the long-term consequences of these bad decisions are far greater.”

“The Republican Party held control of both houses of the General Assembly as well as the governor’s office for the past four years. Over those four years, we saw a stark decline in state funding for public education and a dramatic increase of local school property taxes in 70 percent of school districts statewide. Democrats in Harrisburg were also forced to sit on the sidelines as the policies advanced by Republican control saw Pennsylvania drop to dead last in job creation and saw our credit ratings downgrade five times in four years – costing Pennsylvania taxpayers, annually, an additional $140 million in debt service payments as a result.”

“The Republican majority continues to hold Pennsylvanians hostage to a rigid and unwavering public policy position on two issues which are not intrinsic to a balanced state budget: pension reform and liquor privatization. While Governor Wolf has made significant concessions to the Republicans publicly and in closed-door negotiations, the Republicans remain unwilling to move at all from their position on pensions, liquor privatization and the Marcellus shale severance tax.”

“Governor Wolf was elected by a strong statewide majority on campaign issues that now constitute the major focus of his agenda in this budget debate: adequate public school funding; real property tax relief; a reasonable severance tax on the natural gas industry; and a return to fiscal and budgetary responsibility. Unfortunately, the Republican majority in Harrisburg continues to operate on autopilot while allowing our state to slip into mediocrity as the quality of life for many citizens and workers across the Commonwealth declines.”

“Pennsylvanians need and deserve courageous leadership and principled, well-informed, fiscally-responsible conduct from their elected leaders. Stalling or evading our responsibility to balance a full and complete state budget is not in the public interest. When we have divided government the only way to resolve differences is to negotiate – and this stopgap budget allows the Republican majority to evade the urgency of those negotiations.”

The $11 billion plan passed the Senate by a 30-19, party-line vote. The House is expected to begin debating the stopgap budget bill that passed the Senate next week.

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Senate Dems Express Grave Concerns About Pension Reform Bill

HughesCostaBlakeHARRISBURG – 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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View Letter to PERC →

View Letter to Senate Republicans →

 

Blake’s Veterans Pension Bills Win Senate Approval

HARRISBURG, Dec. 11, 2013 – Legislation introduced by state Sen. John Blake to help veterans who are employed by the City of Scranton more quickly participate in its pension program have won the Senate’s approval.

Senate Bill 703 amends the Scranton Police and Firemen’s Pension Law and Senate Bill 704 changes the Scranton City Employee Pension Law so city employees can buy military service credits and apply them to their retirement benefits without having to wait three years, which is the requirement of current state law. The changes would achieve parity with workers from other cities across Pennsylvania.

A state commission has determined that the proposals will not add to Scranton’s cost for operating the pension system. The reason it does not increase costs for the city is because of the military service credits.

“The women and men who have served to defend our liberties are committed to whatever task that lies before them. When they return from service they should be afforded every opportunity to pursue retirement security for themselves and their families,” Blake said following the Senate vote Tuesday. “These measures pose no additional costs for Scranton.

When an eligible member decides to purchase non-intervening military service credits, he or she erases the city’s expense. That payment is equal to the amount the member would have contributed had he or she been a member of the pension fund during their military service, plus the equivalent of the city’s contributions that otherwise may have occurred during that service.

“As veterans take up public safety positions and public service positions in our community it is good to know that they can have some peace of mind for their future.

“I am looking forward to working with colleagues in the PA House to swiftly get this legislation through their chamber and to the governor for his signature,” Sen. Blake said.

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