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PA GOP leadership ‘within a day or so’ of agreeing on pension reform, liquor privatization

By   /   June 19, 2015  /   News  /   No Comments

By Andrew Staub | PA Independent

Pennsylvania lawmakers have just 12 days to deliver a budget to Gov. Tom Wolf to meet the June 30 deadline, but the state Senate’s top Republican said Thursday afternoon there’s “plenty of time” to finish a spending plan and finally address two of the GOP’s most vexing public policy issues.

“We are probably within a day or so of having an agreement with House Republican leadership and Senate Republican leadership on both pension reform and liquor privatization,” said Senate President Pro Tempore Joe Scarnati, R-Jefferson.

If true, that’s big. Really big.

Photo courtesy of Ballotpedia

A BIG DEAL: State Senate President Pro Tempore Joe Scarnati said Republican leadership is close to agreeing on pension reform and liquor privatization.

The Senate has already passed a public pension reform bill, and the House has already approved a liquor privatization bill. The House has nine session days and the Senate seven session days scheduled through June 30, which conceivably gives them enough time to pass both pieces of legislation and OK changes made by their counterparts.

If Republican lawmakers pull it off — and they couldn’t even when GOP Gov. Tom Corbett was in office the past four years — it would leave Wolf, a Democrat, with some big decisions to make.

While lobbying for a severance tax to help fund a $33.8 billion budget proposal that ramps up education funding, Wolf has opposed the GOP pension reform plan and liquor privatizations plans.

That has prompted some Harrisburg observers to predict a protracted budget stalemate over the summer. But Scarnati met with Wolf earlier this week and indicated there might be an opening for movement, at least on one issue.

“He seems to be making some progress on understanding the importance of pension reform. I can’t say that I saw the same progress in the conversation on liquor,” Scarnati said of Wolf.

The Senate’s pension bill would save $18 billion over 30 years, largely from making changes to current employees’ benefits. It also puts new state and public school employees in a pension system that contains elements of a 401(k)-style approach.

RELATED: Pension reform promises $18 billion savings, but questions linger

Wolf’s press secretary, Jeff Sheridan, noted that talks are ongoing and that the governor is open to conversations about pension reform. However, he did not give the impression Wolf’s stance on the pension issue has shifted any closer to that of Republicans lawmakers, reiterating the governor opposed the legislation the Senate passed.

The governor wants to modernize the state’s wine and spirits stores and use increased revenue to pay down pension debt with bonds. He opposes privatization.

Sheridan cited this week’s Franklin & Marshall College poll that found 58 percent of voters support Wolf’s budget plan, with education funding the top priority and liquor privatization the lowest.

“I hope that Sen. Scarnati begins to understand the importance of funding our schools and decides to stand with our children, not gas companies,” Sheridan said.

Public-sector unions oppose both the Republican proposals, and they’ve gotten solid support from Democratic lawmakers who make up the minority in both the House and Senate.

That’s forced the GOP to go it alone. Republicans in the House have supported privatization, while the Senate has taken on pension reform. They’ve yet to agree on what to send a governor.

Jennifer Kocher, spokeswoman for Senate Majority Leader Jake Corman, R-Centre, said liquor privatization has been a priority in budget talks, but there’s no schedule for running the legislation at this point

House Speaker Mike Turzai’s liquor privatization bill would phase out the about 600 state stores and allow beer distributors to add liquor and wine to their inventories, thus ending the confusing system in which Pennsylvanians have to buy wine, liquor and beer in different stores.

Scarnati would not say exactly how a deal on liquor privatization would compare to Turzai’s original bill, but he did say it would include closing the state-owned wine and spirits shops and sale/lease of the wholesale system.

State Sen. Scott Wagner, R-York, is also close to introducing his own version of liquor privatization, which aims to get the state out of the booze business without upending the already privatized beer industry.

RELATED: In privatization debate, lawmaker wants to avoid mixing liquor, beer policies

Wagner’s bill could be a “construct” of where lawmakers are at, but it’d be quicker for the Senate to make use of Turzai’s bill. Plus, the House Speaker has long championed privatization, “and it should be his bill,” Scarnati said.

Turzai’s legislation has been sitting in the Law and Justice Committee for more than 100 days. The chairman of the committee, state Sen. Chuck McIlhinney, R-Bucks, presented his own privatization plan last session and has faced conservative criticism about holding up a past privatization bill.

Earlier this week, McIlhinney said a bill addressing the direct shipment of wine needed be handled before privatization could truly be discussed, according to a report from Capitolwire.

“Before I get into that stuff, we have to clear this up,” he said, according to Capitolwire.

McIlhinney did not return a message seeking comment about why he hasn’t moved the bill, but Scarnati said the committee chairman held it at the request of Senate leadership, which wants to strike a deal with the House.

Jason High, Wagner’s chief of staff, said he’s under the impression McIlhinney would “play ball” with a liquor bill. Scarnati’s support of privatization also lends hope to the cause, High said.

It’s partly a numbers game, too. Republicans were just a couple votes short of the needed support for privatization last session, Scarnati said. Since then, they have grown their majority to 30 members, affording them more leeway to lose a couple of GOP votes.

In his lobbying, Scarnati said he’s often told fellow senators “if you’re not for liquor privatization, if you’re not for pension reform, you must be for one hell of a big tax increase.” If GOP lawmakers send Wolf both proposals, he’d be “foolish” to veto them, Scarnati said.

“If that’s the path he wants to take,” Scarnati said, “then clearly he needs to explain that to Pennsylvanians, why he’d prefer to raise your taxes and stifle the economy over doing pension reform and liquor privatization.”

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Andrew formerly served as staff reporter for Watchdog.org.