Stack Applauds Passage of Philadelphia Fiscal Bill That Helps Philadelphia Police Officers and Firefighters

HARRISBURG, SEPT. 17, 2009 — The Senate today approved legislation that would address the City of Philadelphia’s fiscal issues and avert the closure of city services and layoffs of emergency responders.

“Losing hundreds of police officers and firefighters would have been devastating to our city,” Stack said. “Their presence on our streets is invaluable, which is why I’m glad that they will continue to keep us safe, and the pensions they earned will be protected.”

The unions, which had concerns with an earlier version of the legislation because it harmed collective bargaining rights for working Pennsylvanians, now fully support House Bill 1828 in its current form, including the Pennsylvania AFL-CIO, Fraternal Order of Police, International Association of Fire Fighters (IAFF) and American Federation of State, County and Municipal Employees (AFSCME).

“Finally, this legislation will provide the relief Philadelphia needs to move forward and staves off implementation of any doomsday scenario,” Stack said. “It avoids massive layoffs and keeps valued city services open, while offering solid good-government pension reform.”

Stack worked closely with the Fraternal Order of Police, the Professional Firefighters Association, the State AFL-CIO and Sens. John Rafferty (R-44th Senate District), Sean Logan (D-45th Senate District), Jane Orie (R-40th Senate District) and Christine Tartaglione (D-2nd Senate District). A majority of Philadelphia police officers and firefighters from Stack’s district live in the 5th and 2nd Senatorial Districts represented by Sens. Stack’s and Tartaglione’s offices.

Under House Bill 1828, Philadelphia will have the authority to increase its sales tax by 1 percent for five years, amortize pension payments over 30 years, and defer pension payments for two years, which the city will repay with 8.5 percent interest. If Philadelphia fails to repay pension deferments, it would receive a tough penalty and state funding will be withheld.

If signed into law, this fiscal plan will avert the city’s last-resort plan to lay off hundreds of police officers and fire fighters, close all libraries and recreation centers, close two city health centers, and eliminate almost 3,000 positions, according to the mayor.

“We’re facing unprecedented economic times, but workers shouldn’t be punished for the worldwide recession, poor investment decisions, or an employer who failed to make consistent, level contributions,” Stack said. “This current legislation ensures that union bargaining rights are not harmed and that municipal retirees and current workers will get the pension benefits they worked hard to build over many, many years.”

The legislation gives Pittsburgh and other Pennsylvania municipalities the opportunity to address their own financial woes by reorganizing their pension systems as well.

It also includes several significant pension reforms for municipalities statewide, including guidelines for municipalities that choose to implement Deferred Retirement Option Program (DROP) and banning elected officials from participating in DROP. The bill contains significant restrictions on pay-to-play and ethics requirements for pension plan administrators to ensure that pension consulting contracts are not give to the highest campaign donors.

The measure also includes a Stack supported provision that requires Philadelphia to certify that it needs the sales tax increase each year as part of its five-year plan.

Once Gov. Ed Rendell signs House Bill 1828 into law, Stack said he would draft a resolution to create a Special Senate Select Committee to review municipal finances and pensions as described in the bill.

“This committee would monitor the cities’ use and implementation of their new financial plans, including Philadelphia’s use of the sales tax increase,” Stack said. “It’s another necessary step toward make sure the public is protected and promises that were made, are kept. It’s another accountability measure to ensure taxpayer protections.”

The bill now goes to the governor for his approval.

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