The state Senate GOP’s plan to change to Pennsylvania’s pension system is a heavy political lift that remains untested in the Legislature.
After months of silence on the details of a pension overhaul proposal, Republican leaders are gearing up for a fast and furious week.
They expect to receive an actuarial analysis Tuesday on how much their proposed changes could save for the retirement systems’ collective $53 billion liability. By the end of the week, they expect to hold a final vote on the bill. The measure would close the traditional pension system to any new workers and ask more of the employees enrolled in it now.
“It’s going to be controversial — there’s going to be grinding and gnashing of the teeth,” said Senate President Pro Tem Joe Scarnati, R-Jefferson, who supports the changes. “But you know what? Either you want to fix this disease that’s killing the Pennsylvania budget … or you want to put tax increases on every Pennsylvanian for a lifetime.”
Some say Republican-backed amendments are waiting in the wings to exclude certain employee groups from the pension changes.
But leaders say they have the votes to pass the plan in their chamber, setting up what they hope is part of a grand bargain with the House and the governor’s office. That negotiation could rope in other issues (e.g. phasing out the state-run liquor stores, the overall budget, property tax relief).
Democrats and some Republicans have warned that even if the pension bill becomes law, it would likely be challenged in court. The plan asks current state and school employees to pay more toward their retirement — or see future earnings toward their pension decrease.
“To me, once you have a contract, you have a contract going forward. Now, that will certainly be a legal issue that’ll be resolved by the courts,” said Democratic Senate Minority Leader Jay Costa, D-Allegheny, on the Senate floor Wednesday. “I think we’re going into uncharted territory.”
Judges and pension experts have warned that such changes would be ruled unconstitutional. But the Senate GOP says a similar policy has passed court muster in another state, and could also pass in Pennsylvania.