By State Rep. Warren Kampf & State Rep. Tom Quigley
we are proud of our work to pass a serious, sensible pension reform
bill, we are saddened to report that Gov. Tom Wolf has just vetoed that
The governor is claiming everything from not
enough savings to being unfair to public employees as his reasoning for
the veto, but each of his claims rings hollow.
legislation — Senate Bill 1 — would save taxpayers $10 billion, would
preserve the benefits of current employees, and provide new employees a
fair hybrid retirement plan much like the 401(k) plans of the private
sector. This legislation would also be a major step forward in helping
to control property taxes across the state.
sense pension reform was to be a turning point in securing
Pennsylvania's economic future. It would help stop the ever-growing
pension liability burdening state government and school districts while
still providing a fair retirement benefit for new employees and keeping
our promise to current enrollees and retirees. But Governor Wolf says, "no."
Employer contributions into the pension system
have been driving the increases in school district costs — which have
led to increases in school property taxes for homeowners. Without
changes, an amount equal to or greater than 30 percent of the salaries
of teachers and other school employees will go to funding these looming
That’s money that cannot go to books, infrastructure or classroom instruction.
two public pension systems have a combined "unfunded liability" — the
difference between the amount of benefits due enrollees and assets
available — of at least $53 billion. The estimated cost of this
liability is more than $30,000 for every Pennsylvania working resident.
House has taken the right and responsible action in addressing this
pension crisis. This legislation would save taxpayers approximately $10
billion while providing a more predictable, sustainable cost structure
for the future.
Under Senate Bill 1, future state
employees first hired on or after Jan. 1, 2016, and future school
employees first hired on or after July 1, 2016, would be assigned to a
defined contribution/cash balance hybrid plan, similar to the 401(k)
plans offered by the private sector.
By moving future
employees to a defined contribution/cash balance plan, Senate Bill 1
would shift risks associated with volatile markets and benefit
enhancements away from taxpayers; it also would enhance the portability
of future state and school employee retirement benefits.
bill would stop the creation of new unfunded liabilities associated
with adding new members to the defined benefit plan. Quite simply, we
are forcing the state to stop digging the hole that taxpayers are in.
are also included in this change as they, too, would either switch to
the new system upon their re-election (for current legislators in the
pension system), or simply start in the new system for newly elected
How could the governor oppose this?
We urge the governor to join us in setting a sustainable, responsible fiscal path that saves taxpayers billions of dollars.
We urge him to reconsider his decision.
Rep. Warren Kampf is a Republican who represents the 157th House
District in parts of Chester and Montgomery County. He was first elected
to the Pennsylvania Legislature in 2010. State Rep. Tom Quigley is a
Republican who represents the 146th House District in parts of
Montgomery County. He was first elected to the Pennsylvania Legislature