A few days ago, I compared the current PSERS crisis in Pennsylvania to the tragic sinking of the Titanic. If you feel that seemed like a dramatic analogy — I make no apologies. Maybe the following quotes may be more politically correct on this issue.

The current funding issue confronting PSERS represents the greatest challenge the Agency has faced in its history. The funding issue, commonly referred to as the “rate spike” or “rate plateau,” refers to the significant increase in the employer contribution rate in fiscal year (FY) 2012/2013 and following years that is paid by school employers and the Commonwealth to PSERS to fund pension benefits.

Jeffrey Clay, PSERS Executive Director

We should reduce the benefit level. We should reduce when those benefits accrue. We can’t afford it. It’s going to break school districts and the state. It was a giveaway. Interestingly, everyone got upset at the [2005 legislative] pay raise. The pay raise cost the taxpayers about 1/500th of what this [2001] pension grab is costing. And no one got mad at Gov. Ridge. No one got mad at the Legislature back then. I guess it’s because the impact is phased in over so many years. But this is a tsunami compared to the pay raise.

Governor Ed Rendell (during an interview with the Morning Call)

Unquestionably many school districts will be struggling with the staggering 72% increase in this benefit cost for the 2010-11 school year.  As illustrated below, our collision course is very close on the horizon. This is truly a paramount legislative issue that originated in Harrisburg — and needs to be clearly addressed and “fixed” immediately. Although I’m just not convinced we can trust them on this one, as our elected politicians enjoy a similar “guaranteed” pension benefit system with ominous problems of its own. Contact your state representatives and make your voices heard today!

Source: PSERS

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