Gov. Tom Wolf wants to consolidate the state’s two largest pension funds if he wins a second term, state Sen. John Blake told The Times-Tribune today.
Blake, D-22, Archblald, who met with the newspaper’s editorial board, said he supports merging the State Employees’ Retirement System (SERS) and the Public School Employees’ Retirement System (PSERS). Blake is running for a third term against Republican Old Forge School Director Frank Scavo in the Nov. 6 general election.
While acknowledging such a merger could take many forms, Blake argued a consolidated pension system would eliminate duplicate investment fees and benefit members of both pension funds.
“(IF) you take SERS and PSERS, which sometimes are paying fees to the same investment managers, and you take all of their assets under management and put them together, you’ve created a larger fund that has better investment leverage, better ability to reduce fees and redundancy in investment management, and then you have the opportunity to ... do better by the members of both plans,” Blake said. “So, I’m all for that.”
As of the end of last year, SERS had nearly 240,000 members and maintained total fund assets of $29.1 billion. PSERS serves more than 600,000 public school employees and maintains assets worth approximately $53.5 billion as of June 30, 2017.
The Wolf administration did not immediately respond to a request for comment about the potential merger.
Blake also addressed the issue of school property tax elimination, calling Senate Bill 76 — a legislative proposal to abolish school property taxes and fund education by hiking the personal income and state sales taxes — “terrible tax policy.”
Hiking the personal income tax by 61 percent, as SB 76 entails, would put “half” of the state’s small businesses that pay the personal income tax rate out of business, Blake argued. The proposal also would absolve large corporations, from pharmaceutical companies to casinos and banks, of $3 billion in property tax payments annually and shift that burden onto the backs of regular citizens, he said.
“We have to find another revenue stream or look to slight adjustments in the sales-tax base to raise additional revenue to focus it on public education (and) to take the weight off fixed income households that can’t afford the rising cost,” Blake said. “There’s a way to do that without giving the corporate community a $3 billion tax break.”
The 22nd District includes all of Lackawanna County, as well as Pittston Twp. and Avoca, Dupont and Duryea boroughs in Luzerne County, and Barrett, Coolbaugh and Price townships in Monroe County. State legislators earn $87,180.27 annually.
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