Calling the current pension systems "make believe," Rep. Mike Tobash, R-Schuylkill/Berks, met with York residents Thursday to talk about a proposal for pension reform.

Pennsylvania has accrued $50 billion in debt related to the state and education pension systems, a problem Tobash said began when legislators promised unreasonable pension increases in past years.

"It is the biggest problem we've got in our state budget moving forward," Tobash said.

The new proposal, an amendment to House Bill 1353, would change the pension system for all new state and public school employees. Instead of staying under the current system, new employees would move to a hybrid plan that would allow the employees to continue partially under the current system but also be enrolled in a 401(k)-type plan.

The hybrid system is the first step toward reducing the existing debt and limiting the amount of pension growth in future years, Tobash said. If enacted, the plan is expected to save between $11 billion and $15 billion over a 30-year period.

York input: York residents at the town hall meeting, hosted by Rep. Seth Grove, R-Dover Township, expressed frustration at the length of time it will take to see changes to the pension problem.

"There is no silver bullet that will automatically erase 50 billion dollars of debt," Tobash said, but added changing the direction of the pension system is an important first step in the process.


Advertisement

The pension systems are in need of reform because of growing property taxes, but also because of the health of the entire state, said Eric Johnston, a West Manchester resident.

Johnston said he thought the presentation about the reform was well done, and was a promising step toward fixing the pension problem.

Other residents at the meeting agreed, thanking Tobash and Grove for starting to address the problem.

But some residents said they were skeptical the plan would make much difference.

"It's still a very big debt," said Pat Bissett, a Dover Township resident. "I have no faith in this stuff anymore."

Tobash and Grove said they heard residents' frustration during the meeting, but said taking a first step was better than ignoring the problem.

"If we don't tackle this now, it only gets worse," Grove said.

— Reach Nikelle Snader at nsnader@yorkdispatch.com.