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Pennsylvania Legislature mop-up session to consider pension, school taxes, more

| Sunday, Sept. 22, 2013, 11:08 p.m.

HARRISBURG — The General Assembly returns Monday after a 2 12-month recess to consider some priority bills that didn't make it past the finish line in June and some local tax issues.

House Majority Leader Mike Turzai, R-Bradford Woods, said in an interview the top priority should be legislation to rein in costs of state pensions by going to 401(k)-type plans for new employees. Asked whether that would address multibillion- dollar legacy costs, Turzai said, “It turns off the spigot.”

New transportation revenue, pension reform and state liquor divestiture were Gov. Tom Corbett's top priorities in the spring, and none got done. J. Wesley Leckrone, a political science professor at Widener University, said he doesn't have “much hope of any of the big three items on Gov. Corbett's agenda being passed this year. If there is hope on anything, it would be the transportation funding bill.”

It tends to resonate with voters “especially with the (PennDOT) weight limits imposed on some bridges,” Leckrone said.

Turzai highlighted other bills: optional property tax elimination for school districts and cyber charter school reform.

The House Finance Committee this week is set to vote on legislation to provide a menu of local taxes for school districts to eliminate property taxes. The replacement taxes include the earned income tax, mercantile tax or a business privilege tax.

Reducing property taxes has been a contentious issue in Pennsylvania for more than three decades. Pennsylvania voters defeated by a 3-1 margin a statewide measure the late Democratic Gov. Robert Casey pushed in 1989.

Rep. Seth Grove, R-York County, said his local-option property tax bill would take replacement tax revenue and use it to reduce property taxes on a “dollar-for-dollar” basis.

“You're not going to sell that to the public,” said Rep. Anthony DeLuca, D-Penn Hills.

The property tax system often is viewed as unfair, but the issue becomes how high replacement taxes must be raised and whether they can be sustained, said G. Terry Madonna, a political science professor at Franklin & Marshall College.

Erik Arneson, spokesman for GOP Senate Caucus, said there is interest in pursuing a property tax overhaul, including a bill to freeze property taxes for seniors.

Meanwhile, there's a need for more openness and accountability for cyber charter schools, Turzai said.

Cyber charter schools were in the news last month when federal authorities accused Nicholas Trombetta, the CEO of the Pennsylvania Cyber Charter School in Midland, of skimming $1 million in funds.

Changing the funding formula for 15 cyber charter schools is of interest to lawmakers on both sides of the aisle, DeLuca said. The concern is that cyber schools are draining money from school districts, DeLuca said. Their subsidies per student are the same as those in “brick and mortar” public schools, he said.

House Republicans may take a small bite of the transportation issue. Members may consider a $500 million bill rather than the Senate's $2.5 billion bill that would lift the cap on the wholesale gas tax as the primary funding source. That hit an obstacle in the House, where many members objected to the tax.

“I have always contended the amount is too high,” Turzai said. “We ought to be looking at the critical transportation needs of the commonwealth.”

The House GOP plan under consideration would allocate $400 million for critical needs, primarily structurally deficient bridges, and $100 million for mass transit. The revenue source is unclear.

“That won't fly,” said House Minority Leader Frank Dermody, D-Oakmont. Motorists and transit riders “need a comprehensive solution, not a piecemeal plan that shortchanges them.”

Brad Bumsted is state Capitol reporter for the Tribune-Review. He can be reached at 717-787-1405 and bbumsted@tribweb.com.

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