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PA gov: Pension costs are ‘Pac-Man’ to the budget (VIDEO)

By   /   April 16, 2012  /   5 Comments

Pension reforms may start by targeting financially-struggling school districts
By Eric Boehm | PA Independent
NEW CUMBERLAND — Gov. Tom Corbett said Monday he is talking with legislative leaders about solving the state’s growing public pension costs. and a high-ranking member of the House GOP indicated that addressing the pension systems of financially strapped public schools would be a good first step.

In this year’s budget, Pennsylvania will have to spend about $1.6 billion in taxpayer dollars for the state’s two main pension funds — the Public School Employees Retirement System, or PSERS, and the State Employees Retirement System, or SERS.
The pension payments are expected to climb to more than $4 billion by the fiscal year that begins in July 2016, making the pension funds one of the largest cost drivers in state government, Corbett said.
State Rep. Mike Vereb, R-Montgomery, confirmed that discussions have taken place. The first goal is pension reform targeting public school districts with the biggest financial problems, he said.
Neither Corbett nor Vereb gave specifics on what the plan might be, though Vereb said it could ultimately be tied to the state budget, which is supposed to be passed in June.
The combined unfunded liability for the two pension funds exceeds $36 billion, though some studies suggest it may be more than $100 billion.