Today, three of the four unions representing municipal workers blasted amendments made to House Bill 1828, which authorizes Philadelphia to increase the local sales tax and defer contributions to the city pension fund. Organized labor is turning up the heat in Harrisburg and that could mean trouble for Mayor Nutter. If the mayor underestimates the power of the unions, the legislation cold go down in defeat.
The original bill provided straightforward fiscal relief, but the State Senate changed the legislation to include a freeze on benefits for current workers and big cuts for future employees. If the city doesn't make the changes, the state will pull the plug on $700 million in revenue. That would mean 3,000 layoffs and the closure of many city facilities. For the unions, it's a losing proposition either way-- they have to hurt their members or devastate services.
Still, that hasn't stopped labor from aggressively criticizing the bill. The unions are making their argument in public and private. Cathy Scott from AFSCME DC 47 and Bill Gault from the firefighters laid out their opposition to the bill in an op-ed in the Daily News.
Also, Philly Clout reported Fraternal Order of Police held a conference call today to blast the pension amendments. The unions are also intensely lobbying members of the State House, targeting members of the Philadelphia delegation that have strong ties to organized labor.
The argument goes like this: it's unfair to penalize city workers for the fiscal state of the pension fund. The shortfall exists because former Mayor's-- dating back to Frank Rizzo in the 1970s-- failed to make adequate contributions to cover promised benefits. Now, workers are being asked to pay the price for poor decisions by political leaders.
Unions have more than arguments to back up their opposition to the bill. A quick search of campaign finance records show that House Leadership-- including Speaker Keith McCall, Majority Leader Todd Eachus, and Whip Bill DeWeese-- have gotten nearly $70,000 in contributions from AFSCME in the past three years. These lawmakers are not from Philadelphia and may feel more allegiance to the unions than to Mayor Nutter.
Here is the nightmare scenario for Nutter: an odd coalition of fiscally conservative and pro-union lawmakers team up to the defeat the bill. That could potentially happen if Republican lawmakers decide to oppose the sales tax hike on principle and are joined by enough Democrats who don't want to hurt the unions.
There is another possibility, which is also bad for Mayor Nutter. The bill could be amended again to weaken the pension reforms and sent to conference committee. That would mean another delay and put even more revenue in jeopardy. As Philly Clout reported on Monday, the city is already in jeopardy of losing $10 million in sales tax revenue for October. If the bill goes to conference committee, that money would absolutely disappear.
What do you think? Do the unions have enough power in Harrisburg to stop the pension reforms?
It's also unfair to tax me higher and make me pay more to support those pensions when I didn't live in Philadelphia in the 70s and 80s. Why should I suffer because of the lesser contributions back then?— spider9- Its important to note the amendments don't just change the rules and freeze benefits for more time worked for city workers. They also change the rules for cops and city workers throughout the state. Philly didn't actually pay for its commitments back in the 70s and 80s - but a lot of other towns also stiffed keeping up on their pension contributions. So that favors the unions pushing it into conference comittee. On the other hand, why weren't the same unions pushing on the State Senate all of this time? Why are they reacting now to the amendments instead of getting in the State Senate Republicans face months ago? It seems the unions were a little slow to get in the game because they were locked in a "we fight with the mayor" mindset and were blindsided by Pileggi and the Senate Republicans. I'm thinking they will pay more attention to those Senate Republican's challengers in 2010, 2012.— seand
- There is about a 2% chance that the legislation will not go into conference committee, don't you think? There are not just fiscal conservatives in the state legislature, there are fiscally conservative Democrats who are not keen to raise sales taxes in Philly to higher than the surrounding regions in a recession. A more dispassionate treatment of the principles of Econ 101 would likely give a better breakdown in the coverage of who is likely to be for and against this bill. It's not the big bad Pileggi after all, is it, who'll create the most delay. There were plenty of people blindsided, by their own "ideology."— CleanupPhilly
Comment removed.- Philly has to make cuts. Let's be honest. Nobody in the paper wants to deal with it; nobody in the local Democratic party wants to deal with it, but I think we can agree that the longer Philly doesn't deal with things, the worse things get. Let's open up the discussion to getting Philly to face the cuts, collections, and property tax hikes that it can swing, instead of still more taxes on business in a recession. Property taxes here are really, really low. There is room there to come up. Property taxes aren't even properly collected. There is room there for improvement. Collections on other sources of city revenue like forfeit bail are terrible. When is the press going to objectively review the options first instead of just going along with the whatever the local Dem party claims to be able to do even though it's obvious to the rest of us that there are big strategic obstacles? Relying solely on the Harrisburg bail out with sales tax hikes and cuts to uniformed employees, the people who local government actually needs, was a huge gamble that seemed insane from the start. There are cuts to nonuniformed employees that should be undertaken with a clear, fresh eye first, like every other city, county and state did all last year. The skew in the press here is ridiculous to the point of suicidal. Is it because the paper is about to undergo the same rigorous audit of who can be kept and who can't that they are reluctant to start the coverage of right sizing Philly government? Be honest.— CleanupPhilly
- Comment removed.
- No.— uandwhosearmy
- Seand, if you haven't read the latest version of the bill (pn 2609) please do so. There are actuarial standards that may apply to other counties but what you will find is that it is only cities of the first class (i.e., Philadelphia) are subject to the freezing of pensions for current employees and the requirement that an alternative be developed AND linking the temporary sales tax increase and pension refinance plan to compliance with the legislation. What is interesting to note is that while eliminating DROP participation for elected officials, the legislation allows other counties/municipalities to set up their own DROP program. ... Yes Philly has to make cuts in some services. Yes Philly needs to capture the revenue that is due (real estate taxes, forfeit bail, etc). Yes Philly needs to reduce its employee pool. .. I just question that this is the way to do any of this. ... There is NO legislation at all that requires the City to develop or implement a plan to collect past due taxes, something that makes sense. That to me would be the first thing that should be mandated and then link forfeiture of the sales tax or pension refinance to the city's failure to develop or implement. This is legislation that is just as easy to write and could be linked the PA oversight board (PICA). Philly taxpayers are screwed no matter what we do. We are screwed by this incompetent Mayor and we are screwed by this legislature which has failed to fund the guts to do the right thing.— nebulus
- Yes.— kidsfirst
- I could support the Unions on this if they radically changed their archaic work rules. City Management's hands are tied with outdated work rules that prevent them from realizing real cost savings. It's time for the Unions to wake up to the realities of the real world.— cw613
MONEY AND JUSTICE DON'T MIX
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