HARRISBURG — The Pennsylvania House on Saturday torpedoed a Republican-proposed pension bill and with it an apparent path to the end of the budget impasse that has gripped the Capitol for nearly six months.
The vote was 149-52, with all Democrats and more than half of the Republicans opposing the bill, a priority of Republican leadership that would have reduced the traditional pensions of new state and public school employees while enrolling them in accompanying 401(k)-style defined-contribution plans.
Minutes after that vote, House Majority Leader Dave Reed, R-Indiana, said that without the pensions bill, the House would not vote to raise taxes, a step needed for either the $30.78 billion budget supported by the Senate and Gov. Tom Wolf or for the $30.26 billion plan favored by House Republicans. Instead, he said, the House will work to authorize state spending for some period of less than the 12 months that began July 1.
“It does not seem like the majority of the folks in this body want to do a full-year budget, so we’re not really left with a whole lot of other choices right now,” he said.
But both Senate Majority Leader Jake Corman, R-Centre, and Mr. Wolf, a Democrat, said the state needs a full budget.
“The most important thing we do in state government is pass a budget,” Mr. Corman said. “That’s what we’re all elected to do. That is our job. Anything after that is extra, but budget is mandatory that we pass. Not a stopgap, not a five-month, not a nine-month, not an 11-month. A 12-month budget.”
Mr. Corman agreed legislators should not raise taxes without the pension changes, which would have reduced future investment risk to taxpayers. He said the House now should put together a budget that would include no revenue increase at all.
The governor and legislative leaders had agreed — at times tentatively — to a so-called framework that included Mr. Wolf’s priority of increased school funding along with versions of Republican plans to make it easier to buy wine outside state liquor stores and to limit the guaranteed pension for future workers. With the budget bill passed by the Senate and waiting in the House, the pension vote Saturday was seen as an important test.
But as Democrats voted against the bill first in committee and then on the floor, they said they had never agreed to the pension portion of the deal.
“This was a Republican initiative inserted into the framework, and it’s their ball to get across the goal line,” said Bill Patton, spokesman for House Democrats.
Across the aisle, Rep. Eli Evankovich, R-Murrysville, said the state should change its pension systems in a way that would be “a bigger win” for taxpayers.
It was unclear what will happen next. The House called a meeting of the Appropriations Committee but then canceled it so leaders could have further talks. A plan for the House to meet in session Sunday was pushed off to Monday.
Mr. Corman, who has advocated for changes to the pension systems, seemed deeply disappointed by the vote.
“We could have had everything today,” he said. “We could have walked through the door, had major accomplishments, got a budget that sustained us for the future and moved Pennsylvania in the right direction fiscally, with great public policy victories, helping our consumers of wine and spirits getting into the private sector.
“Instead, they walked away from it,” he continued. “It’s unbelievable to me that they would do that.”
Mr. Wolf insisted the agreement to produce a budget had not fallen apart. While much of state government has continued to operate as usual since the previous budget ended June 30, school districts and some social service providers have found themselves cut off from state funding. School districts and intermediate units have borrowed $900 million, according to an estimate by Auditor General Eugene DePasquale.
“We still have a budget plan,” Mr. Wolf told reporters. “We have worked for months, five caucuses, over that period of time to get a budget framework that would lead us to a full-year budget, and I’m still working under the assumption that we can get that.”
A short time later, the House Appropriations Committee chairman, Rep. Bill Adolph, R-Delaware, walked by several reporters and wished them a merry Christmas.
Asked whether he agreed that a budget plan remained in place, Mr. Adolph laughed and walked toward the doors.
Karen Langley: klangley@post-gazette.com, 717-787-2141 or on Twitter @karen_langley.
First Published December 19, 2015, 8:16pm