Resolving our pension crisis will be the single most important thing we do for decades to come.
I will not allow any cuts to any benefits of our retirees.
Let me repeat that: no cuts to any retiree benefits. They earned their retirement. They earned their guaranteed security.
Nor will I allow any pension dollars already earned by any current employee to be diminished in any way.
Through meaningful pension reform, this budget will provide another $140 million dollars in pension savings for school districts across the state.
What we need to do, going forward from this time, is to create a new 401(k)-style retirement benefit for our future employees consistent with the retirement packages currently enjoyed almost universally by private sector employees.
My plan also suggests some adjustment in the way future benefits are calculated for current employees in order to maintain the solvency of our pension system and guarantee all current and future employees a worry-free retirement.
The surest way to guarantee the solvency of our pensions is to make certain that our pension systems can deliver what they promise. We can do that with very little disruption, but only if we act now!
The longer we wait the more disruptive the solution will become. Let us act now.
With some imagination and some cooperation, we can find a way to preserve our existing pensions and allow the next generation of state employees and teachers a chance to shape their futures.
Pennsylvania sits within a day’s drive of 60 percent of the nation’s population. Every year, nearly half-a-trillion dollars worth of goods and services move through our state transportation system.
Transportation is the bloodstream of our economy. If it fails, our economy fails.
However, the average bridge in our state is 51 years old. More than 4,000 of them are now deemed structurally deficient. In rural areas, some roads have been essentially cut in half because failing bridges have been closed to traffic, interrupting emergency services and threatening public safety.
Each day, one-and-a-half million Pennsylvania students travel in school buses across those very same bridges and roads. Our mass transit system has staggered under growing demand, aging infrastructure, and a lack of funding.
Mass transit is crucial to sparing our highways from congestion and providing a reliable environmentally friendly and affordable means of moving around a region.
Yet our customary way of funding transportation has fallen short of our needs.
Travel patterns have changed.
Cars have become more fuel-efficient.
People buy less at the pump.
Coupled with rising construction costs and a lack of serious action from the federal government this drop in revenue threatens our roads and bridges and with them our safety and our livelihoods.
I am proposing two adjustments to the way we provide for our transportation needs.
I am calling on the legislature to pass a 17 percent reduction in the flat liquid fuels tax paid by consumers at the pump.
Second, I am asking the general assembly to begin a five-year phase out of an artificial and outdated cap on the tax paid by oil and gas companies on the wholesale price of gasoline.
This cap was put in place at a time when experts assumed the price of a gallon of gas would never go beyond $1.25. It has gone to more than triple that rate in recent years.