It’s roughly T-minus six months before the November general election, but politicians are already starting their moves. State Rep. Stephen Barrar spoke to residents in Pennsbury Township on April 24, and Gov. Tom Corbett had a “conversation” with members of the Southern Chester County Chamber of Commerce during the chamber’s April 30 luncheon.
It was not a spontaneous conversation with the governor interacting with the crowd. Moderator Sue Schick, CEO of United HealthCare of Pennsylvania and Delaware, asked questions that members e-mailed to the chamber weeks before the event. As with the Barrar event in Pennsbury, the economy and pensions led the list of topics.
However, with Corbett being a former teacher, education was also a primary topic, especially when it coincides with taxes and the state’s finances.
The governor started by saying that the goal of education should be to prepare young people to lead productive lives. There should be an emphasis on all types of post secondary education, not just higher education or college. He said some of the highest paying jobs in the state right now are welding jobs in the natural gas fields. Some of those are paying more than $200,000, he said.
But one of the major economic problems for the state finances is an underfunded pension system, both the SERS for regular state employees and PSERS, the pension system for teachers.
According to Corbett, previous administrations thought the system was overfunded and cut back on paying into it.
“Today we’re $50 billion underfunded,” he said. “We’re now adding $610 million to the budget for pensions every year. That’s $.62 for every new $1 of revenue is going to pensions to pay for past obligations. And what we put into PSERS, the school districts all have to match…Where do they get that money? It’s simple, from every resident in the school district.”
And while districts are required to hold a referendum before raising taxes over a certain amount, there are three exemptions to that requirement. One of the exemptions is to raise taxes to add to the PSERS account, he said. (The other exemptions are to pay existing debt and special education.)
Corbett added that there are proposals to reform property taxes in the state, but that really can’t happen without pension reform. Here, again, he said the same thing Barrar said in Pennsbury, that a change to the pension system would likely happen with new employees only.
Overall, though, Corbett expressed optimism regarding the economy. Especially when it involves job growth.
He said there were no “shovel ready” jobs when he took office in January 2011 and the economy was in the tank. He said he faced a dilemma of either raising taxes or cutting spending. Corbett chose the latter and said that was the right thing to do because as spending was reduced, the state’s revenue increased.
He also said he reduced the size of the governor’s office, not by laying people off, but by attrition. Simply not replacing retirees.
The governor said as the budget went down, businesses became more interested in coming into the state. He told a story about a recent trip to Rome he took with the Archbishop of Philadelphia and Philadelphia Mayor Michel Nutter. It was during that trip that foreign companies made inquiries about moving to Pennsylvania.
He said an Italian company was interested in Pennsylvania because of its location, energy resources, work force and tax structure.
With the energy boom in the state due to Marcellus Shale, energy costs in the state are going down, he said, 40 percent in the past 10 years, and that’s attracting business.
The state managed to save the refineries in Philadelphia and the shipyard now has 11 years worth of new work building oil tankers, he added.
“Pennsylvania has a great future,” Corbett said. “We want to partner with business, not be its adversary.”
Corbett is seeking his second term in office in the November election. There are eight Democrats who want that party’s nomination. Libertarian Ken Krawchuck already has his party’s nomination.
About Rich Schwartzman
Rich Schwartzman has been reporting on events in the greater Chadds Ford area since September 2001 when he became the founding editor of The Chadds Ford Post. In April 2009 he became managing editor of ChaddsFordLive. He is also an award-winning photographer.
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