September 20, 2014

Liquor store privatization and public pension reform aren’t likely to become law anytime soon in Pennsylvania, but an extraction tax for the natural gas industry will probably happen next year.

The predictions came from State Sen. Majority Leader Dominic Pileggi, R-9, who offered insight into the waning days of the current legislative session as well as an outlook for 2015 during a Sept. 17 dinner meeting of the Business and Professional Association of Western Delaware County.

Speaking to a packed room at Mile High Steak and Seafood in Concord Township, Pileggi said he was disappointed that lawmakers had been unable to switch from the underfunded defined benefit pensions of government workers to defined contribution plans, such as 401(k)s, that most workers in the private sector receive.

“We don’t have the votes to make that transition,” he said, explaining that politicians seeking reelection tend to avoid controversial decisions.

He said that even though a bill to eliminate property taxes passed out of committee by a 6-4 vote, “it will not become law,” calling it a subject of intense interest that lacks traction.

However, a bill to give someone who reports a drug overdose immunity from prosecution is expected to become law. And a bill to legalize “physician-prescribed” marijuana has gained support, he said. It would be legalized only in cases such as seizure disorders, for which other prescription remedies don’t exist, he said.

Contrary to popular opinion, Pileggi said one of the biggest impediments to privatizing state stores lies with the business owners who have purchased licenses to sell beer or wine and don’t want to see those investments devalued. They have sought – and gained – support from some lawmakers, he said.

He called Gov. Tom Corbett’s campaign promise to avoid an extraction tax a mistake that the governor now realizes. “Love him or hate him, the governor kept his word,” Pileggi said.

The senator said natural gas companies have approached him and asked to be taxed, saying: “We know it’s coming sooner or later.”

Pileggi believes that arguments that the industry would be driven elsewhere are baseless, pointing out that Pennsylvania is the only state without an extraction tax.

Corbett’s position on the tax has contributed to his low poll numbers, according to Pileggi. Speculating on the gubernatorial election, Pileggi said people disagree on whether it’s probable that Corbett can close the gap. “It is possible,” he added.

Criticism that Corbett has cut education funding is not fair, Pileggi said. The total amount of funding is down because former Gov. Ed Rendell opted to funnel federal stimulus money to schools.

Pileggi said many districts ignored warnings to avoid using those funds for operating expenses since they were temporary. So although the amount of state funding to schools has increased under Corbett, it represents an amount lower than the combined state and federal funds, Pileggi said.

Regardless of whether Republicans retain the top spot, Pileggi predicts the state Senate will increase its majority and the House will retain its dominance, although it may lose a seat or two.

Pileggi said he was pleased that the transportation bill finally passed, and he credited Pennsylvania Secretary of Transportation Barry Schoch for his persistence. The road projects include the Route 322 corridor from Route 1 to Route 95. “That will change this whole community,” Pileggi said. He added that both the funding and the design are in place; however, he did not know what the timetable would be.

Other politicians in attendance at the dinner included Pileggi’s cousin, Concord Township Supervisor Dominic A. Pileggi, and Delaware County Councilwoman Colleen P. Morrone.

Since the early 1970s, BPA has worked to foster working relationships among area businesses and generate interest in local, state and federal issues. BPA is dedicated in the pursuit of guiding and assisting new and existing businesses for sustainable growth and prosperity of the western Delaware County region.

Photos courtesy of Sofia Clinger.