The Pennsylvania State Employees' Retirement System (SERS) has imposed the maximum legal 25% or $1.52 billion "employer contribution" surcharge on this year's state payroll, to fund pensions for troopers, judges, state college professors, legislators and other state workers, in fiscal 2015. That's up from a 20.5% or $1.21 billion contribution last year. (Last year's total revised: a previous version of this item mixed fiscal and calendar year totals.)
In a statement, executive director David Durbin praised "tough decisions" and "hard work" by state officials, who will themselves collect SERS pensions, for the higher taxpayer funding. The rates were set based on estimates by pension consultant Hay Group, which you can view in this report. The surcharge would have been higher -- 31.5% of payroll -- but a 2010 state law limits the annual increase in pension payments, which has the effect of pushing additional payments off into the future.
SERS has $26.6 billion invested, to pay liabilities estimated at $44.8 billion. The gap follows a longstanding policy of promising retirees more money than their direct payroll deductions and the state's exotic menu of public and private investments can finance, especialy since pensions were increased by then-Gov. Tom Ridge in the early 2000s. State law requires the taxpayers to help make up the difference.
FRIDAY: Pennsylvania's Treasury was awarded "Best Practice of the Week" honors by the Chicago-based Government Finance Officers Association (GFOA) for its decision to hire a bond lawyer by making law firms bid competitively, instead of relying on the Commonwealth's usual practice of letting an elected official pick a favorite.
Shouldn't most taxpayer-funded contracts be competitively bid? Pennsylvania "issues general-obligation bonds about twice a year, but has never used a competitive bidding process, as GFOA recommends," for hiring lawyers, the association said in its newsletter.
"Tradition was, the Governor, the Auditor General, and the Treasurer select the bond team" on a rotating basis, acting Pennsylvania treasurer Christopher Craig told me.
(Adds grants, pay data in 2d paragraph) Citing its search for a better workforce and location than what's available in its hometown of Baltimore or other places it looked, Zacros America says it will close its Hedwin heat-sealed packaging factory in that city and replace it with a new plant with 154 jobs on Lake Drive in Newark, Del.
Delaware Gov. Jack Markell said in a statement that the deal was sweetened with a Delaware Strategic Fund grant. Zacros was approved for the $703,505 grant, plus a Capital Expenditure grant of up to $180,000 (3% of Hedwin's $6 million private investment target), state spokesman Peter Bothum told me. The jobs "will be staffed with a broad range of skill sets, salaries ranging from $30,000 to well over $100,000." More on the state grant here.
Hedwin, founded in 1946, supplies cosmetics, drug, flavoring and medical packaging. The firm was purchased by Japan-based films and packaging maker Fujimori Kogyo Co. Ltd. and its Zacros division in 2014. Clients include Siemens Healthcare Diagnostics, which also has a plant in Newark.
The Philadelphia City Planning Commission, at its monthly meeting upstairs at 1515 Arch St., 1 p.m. Tuesday. Agenda here. Some highlights among the proposals to be reviewed:
- 164 "multi-family" apartments and 12 townhomes in a "mixed-use" development at 3201 Race St., currently a surface parking lot next to Drexel University, by David Yeager's Radnor Property Group LLC, represented by Neil Sklaroff at Ballard Spahr.
- 132 "multi-family" units in another "mixed-use" project at 4224 Baltimore Ave., just east of Clark Park in the University City residential neighborhood between the Penn Veterinary school and the University of the Sciences, by developers Clarkmore LP and U3 Ventures, represented by lawyer Matthew McClure, also at Ballard Spahr.
- 22 residential townhomes Wharton Street Properties project at 2010 Wharton St. in South Philadelphia, by developer (and City Council candidate) Ori Feibush's Wharton Street Properties, represented by Joseph Beller at Offit Kurman.
- A Special Purpose Institutional District to expand the Holy Redeemer Lafayette retirement community, 8580 Verree Road
And a South Philadelphia District Plan, and others.
Shares of DuPont Co. rose more than 5% in trading today after Institutional Shareholder Services (ISS), a Maryland-based firm that advises investors in corporate proxy votes, endorsed billionaire activist investor Nelson Peltz and ex-GE manager John Myers against DuPont company nominees for the Wilmington-based materials company's annual board elections May 13.
"The dissidents are onto something in their critique," when they ask if DuPont is "too complex to be managed effectively," ISS said in a report backing Peltz, founder of $10 billion-asset Trian Fund Management LP, and Myers, for seats on DuPont's 12-member board. Reuters reported earlier this month that DuPont would meet with ISS to plead its case. Today's decision shows DuPont, led by CEO Ellen Kullman, failed to convince ISS of the truth of its near-daily mailings to investors claiming the company is on the right track.
"This is a victory for Peltz," Charles Elson, head of the Corporate Governance Center at the University of Delaware, told me. "ISS will swing 20 to 40 percent of a vote. In a close case like this that's quite significant. The fact they buy his story is not helpful to DuPont and quite helpful to him. It's a big shot in the arm for Peltz's story and it's not helpful to DuPont at all, no matter how they frame it." He noted a second adviser, the Glass, Lewis & Co. proxy advisory firm, has not yet weighed in.
Ron Jaworski Golf says it has bought Downingtown Country Club, for an undisclosed sum. The club includes a restaurant and catering venue and the golf course that once formed part of Mickey Rooney's Tabas Hotel complex (the hotel is now the Ashbridge Manor assisted-living facility).
Jaworski, the former Eagles quarterback, fronts the golf course investment group whose partners also include real estate and private equity investor Ira Lubert (Independence Capital, Lubert-Adler, LLR, etc.), Ken Kochenour (head of GF Management, which owns 70+ hotel and recreational properties, and whose partners include Lubert and T/L Ventures boss Robert Keith), and Joe Williamson (also at GF).
As Ron Jaworski Golf the group owns and operate four South Jersey clubs: Blue Heron Pines Golf Club, Galloway Township; River Winds Golf and Tennis Club, West Deptford; Running Deer Golf Club, Pittsgrove; Valleybrook Country Club, Blackwood, NJ.; plus Honey Run Golf Club in York, Pa. (Running Deer and Honey Run are listed as GF properties here.) Jaworski has developed housing at some clubs.
The square Art Deco headquarters on Philadelphia’s ancient Washington Square, with its heavy bronze doors, houses condominium homes these days.
But the words wrought to sell by copywriters and blazoned across national media by art directors at the pioneering ad agency of N.W. Ayer & Son still echo:
A diamond is forever (for De Beers)
Be all you can be (U.S. Army)
Never underestimate the power of a woman (Ladies Home Journal)
Unisys shares were down as much as 8 percent in early trading after the Blue Bell-based computer service company's chief executive, Peter Altabef, told investors sales were down 5 percent in the past three months, due largely to weaker foreign revenues as the U.S. dollar strengthened.
The company plans an 8 percent "worldwide" reduction in its workforce, which totalled 23,000 last year. Severance and restructuring will cost $300 million, resulting in $200 million in yearly savings, the company added.
Unisys says its U.S. and Federal Government sales were stronger this year. The company recorded a quarterly loss of $43 million, or 87 cents a share, on revenues of $721 million, down from $767 million last year, after considering the impact of weaker foreign currencies.