Tuesday NewsClips

Corbett Eyes Overhaul Of Tobacco Settlement Money
Corbett Plans Overhaul Of Tobacco Settlement Cash
Editorial: Use State's Tobacco Fund On Health Care
State University Faculty Union To Negotiate Wage Freeze
Faculty Union To Talk Wage Freeze
State University Faculty Open To Wage Freeze
14 State System Schools To Protest Corbett's Budget
LCCC President Concerned Over Proposed Cuts
Op-Ed: The Penn State Fat Cats
Editorial: Hike Spending Here, Cut There
Blog: Sen. Ferlo Makes Pension Hearing Interesting
Financially Pressed School Districts Eye Pay Freeze
Op-Ed: Unions Not To Blame For State's Fiscal Woes
PA, NJ Must Resolve Austerity, Transportation Needs
Editorial: Hospitals Put At Risk
Editorial: If Public Gets Involved In Budget, Process Will Benefit
Separate Trials Ordered For DeWeese, Stetler On Corruption Charges
DeWeese, Former Rep. To Stand Trial Separately
Editorial: Another BIG Bust
Horse Racing Doing Bettor
House Panel Weighs Requiring Photo ID To Vote
House Panel Hears Plan To Require Photo ID For Voters
Federal Health Care Reform Helping Millions Across PA
Sen. Ward Seeking Limits On Methadone Treatment
Shippensburg University President Withdraws Name For Ohio Job
State Police Investigating Arson At Gasland Filmaker's Property
Harrisburg Mayor Holds Meetings On Incinerator Buyout Offer
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SERS, PSERS Say Unfunded Pension Liability Reaches $30 Billion

The state employee and school employee retirement fund managers reminded members of the Senate and House Appropriations Committee the coming pension contribution spikes for employer contributions cannot be fixed by only addressing pensions for newly hired employees.

            The PA State Employees Retirement System (SERS) said the employer contribution rate will increase steadily over the next 6 years to a peak of 28.1 percent of payroll in FY 2016-17 and then will remain above 20 percent through FY 2032-33.  The current employer contribution rate is 5 percent.

            The PA School Employee Retirement System (PSERS) employer contribution rate to cover the unfunded pension liability will increase to 24.5 percent of payroll in FY 2016-17 increasing to 26.9 percent by FY 2020-21.  The current employer contribution rate is 8 percent.

            With respect to cost of living increases for existing retired employees, the minimum $500 million cost of a COLA has not been factored into any of these employer contribution rate increases.  A cost of a COLA like those adopted in the past would add another 1.6 percent to those contributions for school employees.

            Both fund managers noted Gov. Corbett's proposed budget fully funds the employer contribution, unlike previous administrations.

            Testimony: State Employees Retirement Fund Budget Statement
Unfunded Liability-State Employees: The state employees retirement fund said the current projections of the unfunded pension liability will require an employer contribution rate increasing steadily over the next 6 years to a peak of 28.1 percent of payroll in FY 2016-17 and then will remain above 20 percent through FY 2032-33.  The current employer contribution rate is 5 percent.

            The unfunded liability for state employees is about $10 billion or about 74 percent funded.

            The changes made to the pension programs for new employees by Act 120 of last year will result of an estimated net savings of about $1.3 billion over the next 30 years.  The fund managers noted the state cannot solve the unfunded pension mandate by changing the pension benefits of new employees.

            SERS said last year for the first time the system had more retired state employees than active employees.

Unfunded Liability-School Employees: The school employee retirement fund said the employer contribution rate to cover the unfunded pension liability will increase to 24.5 percent of payroll in FY 2016-17 increasing to 26.9 percent by FY 2020-21.  The current employer contribution rate is 8 percent.

            The unfunded liability for school employees is just under $20 billion or about 75 percent funded.

            The changes made to the pension programs by Act 120 will result in an estimated $1.3 billion in net savings over the next 30 years.

            The school retirement fund managers also noted the state cannot solve the unfunded pension mandate by changing the pension benefits of new employees.

            PSERS said they have 282,000 active employees and 185,000 retirees.

Cost Of Living Increases: Representatives of both the state employees and school employees retirement funds said the cost of a COLA for existing retirees would be over $500 million a year for the next 10 years which is not included in any calculations to finance the current unfunded mandate.

            Sen. Corman (R-Centre), Majority Chair of the Senate Appropriations Committee, asked if there was any difference in calculating pre-Act 9 versus all employees.  

            The school employees fund reported the cost of a COLA for pre-Act 9 employees would be about $1.6 billion for a total cost of $3 billion over the next 20 years or about a 1.6 percent increase of the employer's contribution.  

            The state employees fund said they would have to get back to the Committee.  General information on COLAs for SERS is available online.

Defined Contribution vs. Benefits Plans: SERS managers said it would be difficult to come up with a lower cost contribution plan than the one now required under Act 120 of 2010 with a 3.9 percent contribution rate.  It would be less for PSERS.

            Both SERS and PSERS explained the retirement benefits of current employees cannot be changed to the detriment of those employees as a result of state court decisions.

            Both fund managers also point out changing benefits for new employees does not solve the unfunded pension liabilities.

2010 Performance: School employees fund positive 5.90 percent return for the quarter and a positive 14.23 percent for the one-year period ending December 31, 2010.   

            The state employee retirement fund  earned 5.7 percent in the fourth quarter, bringing annual performance to 11.9 percent, well above the Fund’s 8 percent long-term assumed rate of return.  The fund paid out $2.5 billion in benefits in 2010 with contributions totally $622 million.  Total assets at the end of 2010 were $25.2 billion.

Local Teacher Pay Freeze: PSERS said the request by Gov. Corbett for local school districts to freeze teacher/employee pay would be a reduction in the contributions made by employers.  The fund had estimated a $600 million increase in local payroll for FY 2011-12.  The Governor estimated a freeze would reduce that amount by $400 million causing a corresponding reduction in the employer contributions required.

Early Retirement Windows: SERS said it may be time to revisit early retirement window because of the Act 120 changes in new employee benefit plans.  Earlier studies said the cost of early retirements would have to be absorbed by the retirement fund.

            PSERS said since they have 700 reporting units, it is more difficult to determine an impact, but there is definitely a cost to the retirement system for early retirements, while it saves money on the local  general fund payroll.

Sudan/Iran Divestiture: Both funds indicated they are taking the steps mandated under Act 44 of last year to divest their holdings of stock of companies doing business in the Sudan or Iran.

            PSERS said they have identified about $142 million in holdings for 85 companies.  SERS said they have about $50 million in holdings of 15 companies.

            Both funds face a May 1 deadline for a plan for actual divestiture of stock holdings.

            Video/audio files of the Senate Appropriations Committee hearing are available online.

PA State College, University Faculty Agree To Negotiate Wage Freeze

On Sunday, the Association of Pennsylvania State College and University Faculties, the organization representing the 6,000 faculty and coaches at the 14 state-owned universities, agreed in principle to negotiate a one-year wage freeze as called for in Gov. Tom Corbett’s March 8th budget address.
           “We are prepared to negotiate a wage freeze this year in the context of similar sacrifice shared by our administrative and management counterparts,” said a motion passed unanimously by a committee comprised of representatives from the 14 universities.
           “Our primary concern remains with our students to whom we have devoted our professional careers. We are united with them, their families, and all those who recognize the value of public higher education,” said APSCUF president Steve Hicks, “and we hope to fully concentrate our efforts on restoring the funding that is vital to helping our students achieve their dreams.”
           “The Commonwealth must also recognize its obligations to Pennsylvania’s students. Pennsylvania’s state-owned universities are extraordinary resources that allow students of working class families to build a better future for themselves and for the Commonwealth,” Hicks continued.
           In recent years, the Commonwealth has steadily reduced its support for the universities, and the burden of such reductions has fallen consistently upon the students, faculty, coaches, and staff of the state system. Students have paid increased tuition and fees, taken on more debt, seen elimination of their programs, and experienced a growth in class sizes. APSCUF faculty and coaches have felt the effects of decreased funding by accepting years without pay increases, paying more in healthcare contributions, absorbing the loss of both temporary and regular faculty, and taking on increased workloads.

State System Of Higher Education School Rallies

“United We Stand, Underfunded We Fail,” will be the theme for rallies set for Tuesday at PA State System of Higher Education universities across the Commonwealth.
           Organized by the local chapters of APSCUF, the organization representing the 6,000 faculty members and coaches at Pennsylvania’s 14 state-owned universities, the events are being staged as part of an effort to prevent Gov. Tom Corbett’s proposed 54 percent cut to Pennsylvania’s publically owned universities.
           “The loss of state funds contained in Gov. Corbett’s budget would have a crushing impact on thousands of Pennsylvania’s working class families,” State APSCUF President Steve Hicks said.
           “We stand united with our students, and I encourage everyone to visit, call, or write the members of the General Assembly,” Hicks added. “For the past decade our universities have kept tuition extremely affordable largely by cutting back to the essentials. There just isn’t room to cut more.”
           Tuesday’s Schedule--
-- BLOOMSBURG Information Tables, Kehr Union Multipurpose Room, 10:30-2
-- CALIFORNIA Natali Student Union, 11:00 a.m.
-- CHEYNEY Duckery Social Science Building, 9:00 (Information Table)
-- CLARION Gemmell Student Center (outside) 12 noon
-- EAST STROUDSBURG Stroud Hall, 2:00 pm
-- EDINBORO Front of Baron-Forness Library, 12 noon
-- INDIANA Oak Grove – front of Library, 12 noon
-- KUTZTOWN EVENT WAS HELD ON 3/17;
-- LOCK HAVEN Price Auditorium Plaza, 12:30 p.m.
-- MANSFIELD South Hall Student Mall, 11:45 a.m.
-- MILLERSVILLE Student Memorial Center, Multipurpose Room, 4 p.m.
-- SHIPPENSBURG Front of Lehman Library, 11:30 a.m.
-- SLIPPERY ROCK Old Main, 12:30 pm
-- WEST CHESTER Front, Ehringer Gym & Hollinger Annex, 1:15 p.m.

Monday NewsClips

Editorial: Are We Back To Business As Usual?
Editorial: Open For Business Or For Sale To Highest Bidder?
Editorial: Prune Per Diems
Editorial: Corbett Lets WAMS Go One More Time
Governor Seeks Tobacco Money Shift
John Baer: 50 Percent Cut In Aid To Colleges Is Too Much
York City Schools Face Massive Layoffs
Editorial: Don't Target Good Teachers
Congressional Redistricting On The Way
Five From Northeast Seek Redistricting Job
Op-Ed: Penn State Has Done Its Share To Merit State Funding
Patriot News Debate On Privatizing State Stores
More PA Work For Pittsburgh Lawyers Under Corbett?
PA Measure Would Expand DNA Sample Collection
Op-Ed: Does Harrisburg Have A Trump Card?
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Sunday NewsClips

Blog: Early Corbett Missteps On The Budget
Op-Ed: Penn State Has Done Its Share To Merit State Funding
Poorer Districts Have Most To Lose In Corbett Budget
Educators Bemoan Proposed Cuts
Column: Plan To Cut College Funding Deserves Failing Grade
Editorial: PSEA's Entreaty
Editorial: Voters Common Sense Could Teach Legislators
Editorial: Political Connections Still Surface At Turnpike
Patriot News Debate On Privatizing State Stores
Corbett Eyes Human Services Flex Fund
Legislators Tackle Big Issues: Michael Jackson's Honor
Allegheny County Executive Candidates Face Hard Choices
State Moves Ahead With Private Weights, Measures Inspections
New DEP Pick Says He Will Apply The Law
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Saturday NewsClips

Penn State Halts All Main Campus Building Projects
Kutztown Students Protest Proposed Education Cuts
Students Crushed By Heavy Debt Load
Search for New Edinboro Presidents Will Take Months
Secretary Of Education: Students Come First
School Districts Girding For Deep Cutbacks
Brubaker's School Tax Limit Proposal Knocked
Editorial: Teachers Need To Take Pay Freeze Seriously
Blog: National Headlines For Corbett On Turnpike Pick
Editorial: No Change At This Toll Booth
Senators Hear Solutions To DNA Test Backlog
Table Game Revenue Slumps At Erie Casino
At PA Casinos, No Finders Keepers
Ohio Casinos to Join Western PA's Game
10 States To Watch In Redistricting
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