Energy - March 27, 2015

PA House State Government Committee Hears Testimony on Pension Reform

On Tuesday, the Pennsylvania House of Representatives’ State Government Committee held an information hearing to discuss the institutional problems of the Commonwealth’s employee retirement systems (SERS and PSERS).  The individuals who testified were from nonprofit organizations, investment firms, academia and a union.  Specifically, the testifiers explained the benefits and disadvantages of defined contribution and defined benefit retirement plans, transition costs to new systems, and elements of forming a new design.  Several testifiers discussed pension reform in other states, including Virginia, Michigan, West Virginia and Illinois.  Moreover, there was extensive questioning about the retirement systems' $53 billion unfunded liability—caused predominantly by underfunding of the last 15 years and the Great Recession—and how it has dramatically effected Pennsylvania’s credit rating and debt.  Several testifiers emphasized that there is no “silver bullet” to fix to pay down the debt, but needed to be paid down nonetheless.  While several legislators editorialized the discussion and provided their own opinions of pension reform, State Government Majority Chairman Daryl Metcalfe emphasized in his concluding remarks that it is important that the Commonwealth reforms the state employee retirement systems so that the liability is not passed to future generations.  He promised that based on the testimony, the legislators would begin rigorous debate on how to reduce the pensions’ unfunded liability and design a sustainable retirement option or options for future state employees.


Martina White elected to the PA House in Special Election

On Tuesday, Republican Martina White was elected to represent the 170th District of the Pennsylvania House of Representatives.  She defeated Democrat Sarah Del Ricci by 14 percent of the vote during a special election, making her only the second Republican to be elected from Philadelphia.  White’s election fills the vacated seat of former Representative Brendan Boyle (D), who was elected to the U.S. House of Representatives in the November General Election.

Lt. Governor Mike Stack had endorsed Del Ricci while Seth Kaplan was Boyle’s choice.  Philadelphia labor unions, which tend to favor Democratic candidates, endorsed White.  White is a 26-year financial advisor and graduate of Elizabethtown College in Lancaster, PA.  With her election the number of Republican seats in the House increases to 120, while Democrats maintain 83 seats.