A bill that would give pension increases to more than 60,000 retired school and government workers passed the Pennsylvania House by a comfortable margin on Tuesday, although opponents warned it would saddle taxpayers with a $1 billion bill.
The 135-67 vote sent the measure to the Republican majority state Senate as the current two-year legislative session is winding down.
The proposal applies to municipal police officers and firefighters who have been retired for at least five years, as well as teachers and state employees who retired before July 2, 2001. A House financial analysis said the increases for teacher and state workers would range between 15% and nearly 25%, depending on when the person retired.
Supporters argued that public sector retirees used to get regular cost-of-living increases.
“They've had to make do because we haven't done,” Majority Leader Matt Bradford, D-Montgomery, argued on the House floor. “Let's give these folks the dollars they need to provide for themselves, since they have provided for us for so long.”
But the Republicans who voted ‘no’ characterized it as unaffordable and hard to justify to constituents who don't have traditional defined benefit pensions but will end up paying for the retirees' raises. The financial analysis said the proposal would add $332 million to the unfunded liability for the State Employees' Retirement System and $614 million for the Public School Employees' Retirement System.
“This is very expensive,” said Brad Roae, R-Crawford, noting the state's two public-sector pension plans already have billions in unfunded liability. “This is a local property tax increase and this is a school property tax increase piece of legislation.”
Sen. Joe Pittman, R-Indiana, the state Senate majority leader, said in a statement emailed after the House vote on Tuesday that he empathizes with those who retired before 2001.
“Obviously, we must be careful about the fragile nature of our pension funds,” Pittman said. “The question raised to advocates continues to be how we pay for it without increasing the burden on property taxpayers across this commonwealth.”
