State Roundup: Corbett’s Third Budget Address Only Days Away

By PA Independent

HARRISBURG — Gov. Tom Corbett is scheduled to give his budget address Tuesday morning, and details are leaking and speculation abounds.

It’s the last week before the annual budget scrum really gets under way.

New effort to privatize liquor sales lifts off

Gov. Tom Corbett announced a liquor privatization plan on Wednesday in Pittsburgh that would finally get Pennsylvania out of the business of selling alcohol.

The bottom line, Corbett said, is bringing more convenience and choice to consumers.

“I want a system that gives people greater flexibility and control over their purchases,” Corbett said.

He is the third Republican governor in the past 30 years to attempt to shutter the state liquor store monopoly.

But his plan takes a different tack than previous failed efforts, this time tying  revenues gained by selling off the liquor stores to a new grant program for school districts.  The expected $1 billion in revenue would fund four years of grants for early education, school safety or new programs for science and technology.

The plan allows for up to twice as many wine and liquor stores than exist in the system, up to 1,200 as opposed to about 620. Grocery stores, beer distributors and other retailers could bid on the new licenses. It is not clear how many licenses one bidder could receive.

Existing beer distributors would have the option to apply for an “enhanced license” to sell wine as well as six-packs of beer instead of only cases. They could also apply for a wine and spirits license to add those products to their inventory.

Linking the new education block grant to revenue from the liquor stores is a strong play by a governor criticized for his inability to make deals on major issues during his first two years in office, but he still has a fight to deal with lawmakers – even some within his own party.

Senate Republican leaders have expressed an interest in “modernizing” the existing state-run liquor system, rather than doing away with it. Several House Republicans joined Corbett at the unveiling of the liquor proposal, but Senate members were notably absent.

Corrupt judges indicted after FBI investigation

Longstanding corruption at the Philadelphia Traffic Court resulted in charges against nine individuals – including six current or former judges – on Thursday.

The charges are the result of a federal investigation that began in 2011.  A leaked report about the investigation prompted the state Supreme Court to initiate a review of the Traffic Court, which found multiple instances of favoritism and “ticket-fixing” for politically connected elites.

Senate Majority Leader Dominic Pileggi, R-Chester, intends to sponsor legislation to shutter the Philadelphia Traffic Court.  He says the court has demonstrated its lack of integrity time after time, and the only way to clean up the court is to eliminate it.

Pileggi said the indictments demonstrate the “Traffic Court is not worth saving.”

The seven judges on the court are not required to be attorneys and are paid an annual salary in excess of $91,000.

Pension battle looms, but targets are unclear

In his budget address next Tuesday, Gov. Tom Corbett is expected to announce a pension reform plan that will move all new state employees and public school teachers into a 401(k)-style pension plan intended to produce long-term savings for the state.

Pennsylvania’s two public pension plans are more than $40 billion in debt, but moving new hires to a new plan will not address that massive liability.

So, Corbett is expected to also announce funding reforms for the plan and changes to future benefits for current employees, a move expected to be loudly opposed by public-sector unions.

Any potential changes to the benefits of current employees is also likely to wind up in court – if such changes can pass the Legislature.

This week, Republican leaders in the House and Senate said they were unsure there would be enough votes to make changes for current employees, and questioned the wisdom of reforms that will trigger lengthy political and legal battles.

No more unemployment checks for inmates

Crime will no longer pay in Pennsylvania – at least it won’t pay unemployment compensation.

Until recently the state had no sure way to stop those payments from getting to inmates in county prisons, costing millions in fraudulent payments every year.

Now, using an existing data system called the Pennsylvania Justice Network, the state can cross-match inmate data with unemployment records to identify unemployment beneficiaries in county prisons and stop payments.

Sara Goulet, press secretary for the Department of Labor and Industry, said officials have already stopped payment to about 3,000 people, saving about $18 million in unemployment compensation payouts.

The department attaches an annual savings of about $6 million for every 1,000 unemployment compensation claimants identified, Goulet said.

Here’s how inmates who no longer qualify for unemployment could continue collecting: Once someone begins receiving unemployment, benefits are renewed every two weeks, which can be done over the phone. The applicant can also have someone renew on their behalf. The majority of payments are received via direct deposit or applied to a debit card, eliminating the need for personal check-cashing.

Pennsylvania wins transparency recognition

A national organization has recognized Pennsylvania for having one of the most transparent state governments in the country.

Sunshine Review, a nonprofit dedicated to increasing transparency and accountability in state and local governments, released its annual report card Tuesday. Pennsylvania was one of five states tied for the highest overall grade – a B – and got an A for state-level transparency. Only California, Illinois, Maryland and Washington matched Pennsylvania’s marks.

The high grade for the Keystone State was due, in part, to the launch of the new “PennWatch” website listing all state contracts, expenses and other uses of taxpayer funds – including pay for all state employees.

“Pennsylvania’s state website performed well, only missing information on government-sector lobbying,” said Michael Barnhart, president of Sunshine Review.

Gov. Tom Corbett called “PennWatch” a “historic leap forward.”  Transparency advocates have roundly praised the new website, but they say there is more work to be done – they want to close loopholes in the state’s open records law that protects colleges and universities and communication with members of the General Assembly.

Government lobbying itself to pay for its own lobbying

In Pennsylvania, there’s no law against taxpayer-funded agencies spending money on hiring outside lobbyists to take their respective cases to the Legislature.

That means public money would be spent by public officials to persuade other public officials of their best interests.

This session, one Bucks County Democrat said it’s time to end the waste.

State Rep. Tina Davis, D-Bucks, is once again introducing legislation that would prohibit all state government entities from using public money to hire outside lobbyists to lobby sister agencies or branches.

“State agencies have spent hundreds of thousands of dollars to hire lobbyists to contact State legislators,” she wrote to fellow lawmakers in a co-sponsorship memo. “I am proposing that we end this wasteful and unnecessary spending.”

Davis cites the Pennsylvania Higher Education Assistance Agency and the Pennsylvania Turnpike Commission as entities that have engaged in government-to-government lobbying.

The bill would prohibit any arm of government from entering into a contract or otherwise paying an outside lobbyist. That would include boards under the governor’s jurisdiction, judicial agencies, the legislative branch, independent agencies and state-affiliated entities such as PHEAA and PTC.

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