Pension solution will clear the way for other budget matters, House majority leader says

June 17, 2015

Public pension reform is the first domino that needs to fall in the budget negotiations, House Majority Leader Dave Reed (R-Indiana) told attendees of the PHIA Legislative Breakfast this morning, and once it does, the other dominos will soon follow.

Reed explained that public pension obligations are the No. 1 cost driver for both the state and for school districts. He said the primary focus is pension fund stability over the long term rather than immediate relief.

However, he was not optimistic about the prospects of a solution to the raiding of the Motor License Fund. Currently, more than $700 million from that fund goes to support the State Police, approaching three-quarters of the State Police budget. While many would like to see that number reduced, Reed stated it would be nearly impossible to do so in a year in which they must address a $1.2 billion structural deficit. He agreed that the problem should be addressed in a gradual fashion in coming years. Read more


General Assembly nears introduction of work zone safety legislation

June 2, 2015

Orange construction lightThis week, the General Assembly is set to introduce legislation aimed at improving driver and worker safety in construction zones.

The bill would authorize automated speed enforcement in work zones on limited access state highways. Cameras would photograph license plates of vehicles that significantly exceed speed limits, and the vehicle owner would receive a violation notice. Areas of automated enforcement would be clearly marked.

In work zones, space restrictions make it difficult for police officers to monitor and enforce excessive speeding. In the last five years, there have been 10,586 crashes in Pennsylvania work zones, costing 128 lives. In 2013 alone, there were 1,800 crashes and 16 deaths.

Maryland’s automated enforcement program has proven to be successful. In its first two-and-a-half years, that state saw a reduction from about 7 percent to about 1 percent of drivers significantly exceeding the speed limit in work zones.

“While the industry certainly is concerned with worker safety, this initiative would have much a much broader positive effect,” said PHIA Managing Director Jason Wagner. “According to the Federal Highway Administration, 85 percent of the victims of work zone fatalities are drivers or passengers, not highway workers.”



PennDOT lets nearly $400 in projects during May

May 29, 2015

NEW_PENNDOTPennDOT continued its strong, post-Act 89 momentum by letting nearly $400 million in projects during May, bringing the year-to-date total to just under $1.2 billion. Last year, PennDOT ended the year with $2.6 billion in lettings, the highest since 2009 when the program was boosted by the one-time economic stimulus package. PennDOT exceeded its initial 2014 estimate of $2.2 billion and it was reported earlier that PennDOT’s 2015 anticipated lettings will again be $2.6 billion.

At the end of 2013, PennDOT only bid $1.638 billion in lettings. Act 89 enabled PennDOT to put nearly a $1 billion more projects on the street in 2014 than it was able to do in 2013.

With the recent enactment of the transportation funding bill there is reason to see this trend continue well past 2015. Act 89, which will implement a $2.3 billion comprehensive transportation funding plan over the next five years, will result in PennDOT exceeding the $2 billion construction lettings mark for years to come.

As in year’s past, PHIA will continue to track contract lettings on a monthly basis.

To view the full May letting report and year comparisons, click the link below.

May Letting Report* (PDF)

*The report lists the total contracts awarded at each letting date, a comparison to the same period in the previous calendar year, and letting adjustments made since the previous month. PHIA staff will track PennDOT lettings throughout the year and provide monthly update.




House approves another short-term funding fix

May 22, 2015

congress progressThis week, the U.S. House of Representatives approved a short-term highway funding extension. The extension will be the 33rd short-term fix since 2008 and will authorize funding through July 31.

While short-term extensions have been accurately portrayed as Band-aids on bullet holes, the extra time gives Congress a chance to put together a more comprehensive solution for long-term funding. Many view this as a more pragmatic move than attempting to force an imperfect bill through Congress on a tight deadline. It also is viewed as better than a six-month extension, which would let the issue fester and possibly spill into an election year.

The Obama administration introduced a six-year funding proposal with a $478 billion price tag, but with Republicans controlling both chambers of Congress, most observers believe that is unlikely to be the vehicle for long-term highway funding. Read more


Corman pitches pension reform at PHIA breakfast

May 7, 2015

IMG_1995The additional resources needed to support Gov. Tom Wolf’s proposed budget will not be forthcoming without first addressing the state’s pension issue, Senate Majority Leader Jake Corman (R-Centre) told several dozen attendees at a breakfast hosted by the Pennsylvania Highway Information Association.

Corman, a longtime supporter of ample transportation funding, lauded the safety improvements to highways made possible by the passage of Act 89 in 2013. His constituents and all Pennsylvanians will see the benefits as the funding increases move ahead.

But he emphasized that neither the highway industry nor any other group receiving resources from the state can escape the impact of the increased pension obligation. Pensions are one of the largest cost-drivers of the entire state budget, and the pension system must be modernized to shift the risk away from taxpayers and to free up resources for other programs and services.

Corman informed the group that his caucus is working on a solution that could bring savings to the state by enrolling new state hires in a defined contribution plan instead of a defined benefit plan. Continuing to devote increasing resources to the pension deficit without reform is unacceptable, he said.

House Majority Leader Dave Reed will be the next breakfast series guest on June 17. The series is sponsored by the American Council of Engineering Companies, Burns Engineering and PennStress.


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