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CPA Now
Sep 19, 2016

Pa. Lawmakers Return as Summer Recess Ends

Peter CalcaraBy Peter Calcara, vice president – government relations


The unofficial end of summer is typically marked with kids returning to school, the start of football season, and cooler weather. (OK, many of us are still waiting for that last one to kick in!) For the PICPA government relations team in Harrisburg, we know fall is here when state lawmakers come back in session following their summer recess.

Looks like fall is here. Below are the fall session dates for the state House and Senate:

 2016 Fall House Sessions
 September  19, 20, 21, 26, 27, 28
 October  17, 18, 19, 24, 25, 26
 November  14, 15
 
 2016 Fall Senate Sessions
 September  26, 27, 28
 October  17, 18, 19, 24, 25, 26
 November  16

This is an important election year both here in Pennsylvania and nationally, and the first rule in politics is to do no harm (or as little as possible) in the course of the legislative process leading up to an election. It also means lawmakers will want to spend as much time as possible in their districts. From the top of the ticket – President of the United States – down to the 203 state House districts and 25 state Senate seats, this election will set the course of state government in Pennsylvania for at least the next two years.

The exception this year to the “do no harm” rule may be in state pension reform. With the Public School Employees Retirement System (PSERS) and the State Employees Retirement System (SERS) unfunded liability now nearly $60 billion (some say it’s higher), many legislators believe pension reform legislation is a must do before Nov. 8. The problem, as is often the case, is that lawmakers can’t come to an agreement on a plan.

The Senate passed a side-by-side hybrid proposal that would put all future workers into a 401(k)-style retirement plan. The House rejected the Senate proposal in favor of a stacked hybrid plan, which layers a 401(k) plan on top of a capped version of the current defined benefit system after certain salary or other thresholds achieved by the employee. While neither proposal results in significant short- or long-term savings, the Senate’s plan does shift more risk away from the state and onto workers. That’s not necessarily a bad thing, because anytime politicians are involved in matters involving pensions, politics come into play and the best decisions are not always the driving force.

Leaders in both the House and the Senate (with Gov. Tom Wolf’s support, I might add) have been working all summer to find the right language to achieve the magical numbers 102, 26, and 1. These are the necessary votes in the House and Senate, along with the governor’s support, to pass legislation.

It will take a lot of political heavy lifting to get pension legislation onto the governor’s desk in such a short amount of time, but just when you think something is dead sometimes it can surprisingly arise from the ashes of legislative purgatory, such as the liquor reform legislation signed into law earlier this year.

Expanded gaming is another issue percolating in the halls of the state Capitol this fall. As part of the recently enacted 2016-2017 fiscal year state budget, lawmakers booked about $100 million in new revenue this year from an expansion of gaming. The House approved a watered-down bill (House Bill 2150) at the end of June, but the Senate appears to be uninterested in moving that bill. HB 2150 includes casino-controlled Internet gaming, iGaming, slots machines at airports, and off-track betting sites, as well as regulating fantasy sports in Pennsylvania.

During this brief fall window of opportunity, the PICPA government relations team will push to get its two legislative priorities, Senate Bill 1018 and House Bill 245, through the General Assembly and onto Gov. Wolf’s desk. Senate Bill 1018, which amends the CPA Law, and House Bill 245, legislation reforming Act 32 of 2008, are pending in committees in the House and Senate respectively.

The state constitution mandates a Nov. 30 end to the two-year session that began Jan. 1, 2015. Lawmakers will wrap up legislation by the end of October and return to Harrisburg for a day or two in November to vote on leadership positions for the new session. All legislation not acted on by then must be reintroduced in January 2017 when the new session begins and the process starts all over again.

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