December 22, 2015
By Steven Wishnia and Neal Tepel
Harrisburg ,PA—Legislation to reduce pensions for Pennsylvania state government and public school employees moved one step closer to passage Dec. 15, when the House State Government Committee approved it in a vote along party lines.
The bill would cut defined-benefit pensions in half for all future hires while also putting them into a 401(k)-style plan. Gov. Tom Wolf has said he will sign it, but the House and Senate versions must be reconciled first. The bill would not appropriate any money to pay down the state's approximately $55 billion pension debt, and state pension officials estimate that it would save about $2.5 billion over the next 30 years—unless unions get the courts to void it on the grounds that reducing benefits for current employees violates the state constitution. One group of state employees, however, would get to keep their current pension benefits intact: state legislators. Read more