COMMONWEALTH OF PENNSYLVANIA HOUSE OF REPRESENTATIVES APPROPRIATIONS COMMITTEE HEARING BUDGET HEARING
STATE CAPITOL MAJORITY CAUCUS ROOM HARRISBURG, PENNSYLVANIA
THURSDAY, MARCH 15, 2007, 9:00 A.M.
PRESENTATION BY MEMBERS OF THE HOUSE OF REPRESENTATIVES
BEFORE: HONORABLE STEPHEN BARRAR HONORABLE CRAIG A. DALLY HONORABLE GORDON DENLINGER HONORABLE BRIAN L. ELLIS HONORABLE JOHN T. GALLOWAY HONORABLE WILLIAM F. KELLER HONORABLE THADDEUS KIRKLAND HONORABLE TIM MAHONEY HONORABLE JOSEPH A. PETRACRA HONORABLE SEAN M. RAMALEY HONORABLE JOHN J. SIPTROTH
ALSO PRESENT: MIRIAM FOX EDWARD NOLAN
JEAN M. DAVIS, REPORTER NOTARY PUBLIC
I N D E X
WITNESSES
NAME PAGE
JOSEPH F. MARKOSEK 3
MIKE FLECK 8
RANDY VULAKOVICH 16
KAREN D. BEYER 22
SCOTT PERRY 31
MARK LONGIETTI 39
GENE DiGIROLAMO 43
DARYL METCALFE 47
THOMAS MURT 52
JOHN SIPTROTH 57
CARL MANTZ 61
ROSEMARIE SWANGER 66
EDDIE DAY PASHINSKI 69
JESS STAIRS 79
P. MICHAEL STURLA 84
3
1 REPRESENTATIVE KELLER: The hour of 9 o'clock
2 having arrived, I'd like to call to order the last
3 meeting of the appropriations hearings. This is when
4 the members have the chance to make a statement to the
5 committee. I would like to welcome Chairman Markosek.
6 Good morning, Joe. Would you like to start,
7 please?
8 REPRESENTATIVE MARKOSEK: Yes. Thank you,
9 Mr. Chairman.
10 Ladies and gentlemen of the committee, thank
11 you for the opportunity to testify before the
12 Appropriations Committee today. My name is Joe
13 Markosek and I represent the 25th Legislative
14 District, including constituents in Allegheny and
15 Westmoreland Counties.
16 As chairman of the House Transportation
17 Committee, I was pleased to see the Governor's
18 proposed budget acknowledge and emphasize the critical
19 state of Pennsylvania's roads, bridges, and transit
20 systems. We are truly at a crisis in Pennsylvania.
21 The Governor's Transportation Funding and
22 Reform Commission report found that Pennsylvania is
23 faced with 5,913 structurally deficit bridges, the
24 highest number of any state; 8,528 miles of roads in
25 poor condition; and 25 percent transit service cuts
4
1 looming in the future.
2 Mr. Chairman, our Commonwealth is a center
3 for industry, a vital commercial shipping corridor,
4 and home to the sixth largest state population in the
5 country. Pennsylvania is truly the Keystone state.
6 More than 12 million residents rely on Pennsylvania's
7 infrastructure to support every aspect of their daily
8 lives.
9 Each year, manufacturers and distributors
10 rely on our waterways, highways, airports, and rail
11 systems to transport billions of dollars in raw
12 materials and finished goods. In fact, commercial
13 traffic accounts for 21 percent of the vehicles on our
14 interstates.
15 The port of Pittsburgh alone moves
16 approximately $8 billion in goods annually, which
17 equates to 53,000 jobs and more than $2 billion in
18 income to the region. Unfortunately, with an aging
19 infrastructure and inadequate funding for maintenance
20 and upgrades, our Commonwealth is crumbling. Like a
21 decaying tooth, we have haphazardly filled holes that
22 needed more attention and now our transportation
23 system is in need of a major root canal.
24 Allow me a minute to outline the scope of our
25 problem. Mass transit. In an age of rising gas
5
1 prices and growing cities, mass transportation has
2 grown faster than ever before. In the Commonwealth,
3 transit use by all modes increased by an average of 5
4 percent between 2004 and 2005. In fact, more than one
5 million Pennsylvanians use public transit on a daily
6 basis. That's more than 400,000,000 rides annually.
7 Unfortunately, transit has been unable to
8 bear that load adequately; and faced with aging,
9 decades-old equipment, fare increases and service cuts
10 have been their only alternative.
11 Mr. Chairman, we live in an era where the
12 cost of oil, environmental concerns, and traffic
13 congestion hang heavily over the minds of Americans
14 and substantiate the need for public transit.
15 This is not just an urban issue. Over 77
16 public transit systems across the state deliver people
17 to their jobs, schools, businesses, and family. In my
18 own district, I have heard the concerns of many
19 constituents who will be immobilized by pending
20 service cuts by the Allegheny County Port Authority.
21 These shortfalls will not disappear with
22 time. As federal funding continues to decrease, we
23 must come up with a way to fund and stabilize
24 statewide mass transportation.
25 Roads and bridges. And just as mass transit
6
1 has felt the hard-worn effects of this funding crisis,
2 so too have our roads and bridges. I'm sure everyone
3 in this room can bring up a particularly frustrating
4 road or highway that desperately needs repair. There
5 is a backlog of road projects that need to be attended
6 to for increased safety and reduced congestion. With
7 more than 120,000 miles of roads, Pennsylvania has the
8 distinct challenge of having some of the oldest
9 highways in the nation.
10 In addition to age, our state has more miles
11 than any other state that must deal with severe
12 winters. Pavements are susceptible to cracking and
13 expanding due to the temperature and weather changes
14 in the state. Also, the salt used during snow and icy
15 conditions decreases the life of a pavement as
16 compared to a southern state.
17 Finally, being in the economic corridor,
18 there is the inevitable commercial truck traffic that
19 will continue to degrade the roads more rapidly. Add
20 to that 64 closed bridges and 735 bridges with posted
21 weight restrictions last year and we have a limited
22 mobility of people, goods, and public safety vehicles.
23 Federal Highway Administration statistics
24 show that 27 percent of Pennsylvania's roads are rated
25 mediocre or poor. For the nation as a whole, that
7
1 number is 18 percent. Pennsylvania's infrastructure
2 must not continue to fall behind the national average
3 if it is going to be a leader in attracting jobs,
4 families, and tourists.
5 In our 2006-2007 budget, we took a step in
6 the right direction, allotting an additional
7 $20 million for bridge preservation and $10 million
8 for emergency highway and bridge repairs. The harder
9 question will be finding a solution that is
10 sufficient, sustainable, and reasonable and, at the
11 end of the day, has acceptance by a majority of the
12 Legislature and the public.
13 In his budget address, Governor Rendell
14 proposed some bold and creative solutions to cover a
15 $1.7 billion annual price tag the Transportation
16 Funding and Reform Commission says is necessary to
17 maintain the state's roadways and transit systems.
18 I'm looking forward to studying and
19 considering the feasibility of his suggestions.
20 Certainly there are many variables when you consider
21 leasing our turnpike or introducing a new tax. But
22 this is a big step in the right direction. I'm also
23 hoping to hear from my colleagues and work in a
24 bipartisan fashion to accomplish a long-lasting
25 solution that everyone in every part of the state can
8
1 live with. But one thing is clear. The days of
2 inaction are through. We cannot wait any longer.
3 I ask you and the committee for your support
4 in addressing this problem. Thank you.
5 REPRESENTATIVE KELLER: Thank you,
6 Mr. Chairman. I'm glad to see I'm not the only one
7 talking about ports these days. Thank you very much.
8 Representative Fleck.
9 REPRESENTATIVE FLECK: Thank you, Chairman
10 Evans, Chairman Civera, and members of the committee.
11 Governor Rendell's proposed budget for 2007
12 has many great initiatives. However, I'm not sure how
13 the Commonwealth might pay for these new programs,
14 outside of the obvious answer of raising taxes or
15 cutting other vital programming. My testimony will
16 address just a few of the funding cuts that will
17 affect not only the 81st Legislative District but the
18 entire Commonwealth.
19 First off, Science in Motion has been
20 eliminated in the Governor's budget. The SIM program
21 that originated at Juniata College is about to
22 celebrate its 20th anniversary. I'm a firm believer
23 in the program and quite likely the only legislator
24 who can speak with first-hand knowledge regarding the
25 benefits of such, as it was a vital part of my
9
1 curriculum as a student at Southern Huntingdon County
2 High School.
3 It's amazing and inspiring to me to see how
4 the initiative has grown from one van, with one mobile
5 educator, traveling to a handful of schools, into the
6 program that we have today. Based on the 2005-2006
7 program report, Science in Motion supported 5,165
8 classes during the '05-'06 fiscal year.
9 Equipment loans and prepared experiments were
10 delivered to an additional 6,447 classrooms.
11 Altogether, 217,366 student experiences were provided.
12 Science in Motion provided support to 698 teachers in
13 307 public, private, and parochial schools. Eleven
14 institutions of higher education serve as the hubs of
15 these programs: Cedar Crest College, Clarion
16 University of Pennsylvania, Drexel University, Gannon
17 University, Gettysburg College, Juniata College,
18 Susquehanna University, University of Pittsburgh at
19 Bradford, Ursinus College, Westminster College, and
20 Wilkes University.
21 Science in Motion is bringing vital and
22 creative science curriculum to our students and it's
23 doing it at a huge savings to the participating school
24 districts, an estimated $59,582 per school district.
25 As a former school board member, I can assure you that
10
1 SIM is providing an effective science program. I can
2 also assure you that if it were not for SIM, it's
3 highly unlikely that the local school board would
4 expend additional dollars for similar-type
5 programming.
6 SIM is able to loan equipment to individual
7 teachers. More often that not, the aforementioned
8 equipment is quite expensive and it's just not
9 feasible for an individual district to purchase
10 equipment that would only be used a few days each
11 year, whereas SIM can provide the same piece of
12 equipment to numerous districts within their service
13 area.
14 Just as importantly, because SIM has free
15 access to major equipment such as autoclaves and water
16 deionization systems already in place at the higher ed
17 support sites, there is no way that individual schools
18 can equip themselves with the same resources for the
19 same cost. Therefore, SIM school districts get the
20 advantage of the equipment but not the associated
21 cost, while saving overall tax dollars.
22 Upon entering higher education and technical
23 careers, SIM students are far more advanced than their
24 counterparts. Science in Motion is an effective
25 component of today's education experience. As our
11
1 nation continues to bemoan the loss of technical jobs
2 and industries to foreign markets and we worry about
3 poor student performance on international assessments
4 of math and science, this is something Pennsylvania
5 needs to do, not just for education but for the
6 economy.
7 In the last few years, Governor Rendell
8 introduced his initiative, Science: It's Elementary.
9 I believe Science in Motion is a continuation of
10 everything the Governor is trying to accomplish and
11 should be viewed as an integral component of the
12 overall science curriculum. The Governor is asking
13 for $15 million for the Science: It's Elementary
14 program, an increase of $5 million over the current
15 year; whereas SIM is currently being funded to the
16 tune of $2.5 million. Considering the overall impact,
17 that's pennies on the dollar.
18 I ask my colleagues to join me in support of
19 Science in Motion and I hope that we not only fund the
20 program but seek creative ways to expand it throughout
21 the Commonwealth.
22 Secondly, I would like to address the plight
23 of public libraries within the Commonwealth. For six
24 years, I served on the Huntingdon County Library
25 System board of trustees, four of which as president.
12
1 This year's budget calls for a paltry $250,000
2 increase. It doesn't begin to rectify the budget
3 crisis of the last few years. The public library
4 subsidy funding formula last ran in 2002. Since then,
5 public libraries have laid off employees, slashed
6 hours, and cut vital programming.
7 As a former library president, I've had to
8 make very tough decisions just to keep the doors open;
9 furthermore, it is a real struggle to meet the most
10 basic of requirements. We are operating at the
11 minimum number of hours as required by the standards.
12 The past few years we've barely kept our heads above
13 water. I wish this was a remote case solely found
14 within the Huntingdon County system. It is not. Many
15 libraries are fortunate to have large endowments;
16 however, given the volatile economic situation of the
17 last several years, our investments have yielded
18 little profit.
19 Within the past few years, we've been hit by
20 forces beyond our control. Rising fuel costs and the
21 increase in the minimum wage have exacerbated the
22 situation. Last year, the average wage, minus the
23 executive director, of the Huntingdon County Library
24 employee was $14,000. The impact of the minimum wage
25 increase has raised that to a whopping $15,000. In
13
1 February 2006, Huntingdon County saw the opening of
2 its first Wal-Mart; whereupon, I lost good seasoned
3 employees.
4 I fully realize the importance of local
5 giving. Nonetheless, local giving has remained
6 stagnant in the last decade due in large part to
7 demands from MH/MR as well as increased cost
8 associated with our judicial system. It's hard to
9 imagine but, once again, the local drug dealer has won
10 out over the local library.
11 I'm also greatly concerned over the cuts to
12 the Ag Department, cuts within the Department of
13 Aging, and cuts regarding economic development;
14 namely, business retention/expansion and small
15 business development centers. Nevertheless, in the
16 time remaining, I will change directions and discuss
17 briefly the areas of the budget that I feel are
18 questionable.
19 I'll start with the Classrooms for the Future
20 initiatives. While I like the idea in concept, I find
21 it hard to believe that we would place another mandate
22 on the local school district. For five years, I
23 served on my local school board. Should the
24 Classrooms for the Future initiative become reality,
25 we would face yet another unfunded mandate; whereupon,
14
1 we would have to hire additional technology support
2 staff to implement and monitor the program. Together
3 with the $90 million price tag, I'm not so sure this
4 is the year to do it.
5 As a member of the Education Committee, I
6 listened rather intently during last week's hearing.
7 The statement was made that additional monies needed
8 for textbooks can be rolled into the program because
9 books will, in all likelihood, become obsolete. I
10 think that was the line they used with the advent of
11 the computer. There will be no need to make a copy,
12 just save it on your hard drive. Yet this very
13 morning, I had to make 45 copies of my testimony. I
14 was also told in elementary school that I would have
15 to know the metric system because it too would be
16 obsolete by the turn of the century. I rest my case.
17 The increase in the Department of Public
18 Welfare bothers me greatly. While I don't doubt there
19 are citizens of our Commonwealth who desperately need
20 assistance, I think we are going about it the wrong
21 way. Perhaps the old proverb is true, give a man a
22 fish and he'll have a nice meal; teach him to fish and
23 he'll eat for a lifetime. We have lots of books at
24 our local library regarding the sport of fishing;
25 however, be sure to call first because in all
15
1 likelihood, it will be closed upon your arrival.
2 I appreciate the Governor's vision for
3 education and that is why I question the proposed
4 budget when it relates to important educational
5 institutions, such as the local public library, as
6 well as new and creative endeavors like Science in
7 Motion, especially since they both provide proven
8 results.
9 In closing, I'll leave you with the advice my
10 grandfather gave me upon entering college. Get a good
11 education. It's the one thing man can't take from
12 you. My testimony shouldn't be taken out of context.
13 I do believe this is an enormous budget and it would
14 appear unfathomable that I, Representative Mike Fleck,
15 a dyed in the wool, no new taxes, freshman, reform,
16 Republican, would ask for additional spending, because
17 that is incorrect.
18 I'm simply asking that we not cut current
19 programs that are vital to our constituents. This
20 budget appears to be educating or dare I say
21 attempting to reform our citizens within the public
22 assistance and/or judicial system. I realize the
23 enormous task at hand and I look forward to working
24 with my colleagues as we hammer out a budget that
25 works.
16
1 Thank you.
2 REPRESENTATIVE KELLER: Thank you,
3 Representative. I don't know if you know him yet, but
4 I think I'll have to introduce you to Representative
5 Samuelson. You and he have done a lot of the same
6 research.
7 REPRESENTATIVE FLECK: Thank you.
8 REPRESENTATIVE KELLER: Representative
9 Vulakovich.
10 REPRESENTATIVE VULAKOVICH: Good morning. On
11 behalf of the citizens of the 30th Legislative
12 District, I would like to thank you for the
13 opportunity to discuss the issues of law enforcement
14 and gaming as they pertain to the Governor's 2007-2008
15 budget as well as the cost-saving merits of my
16 legislation, House Bill 482, which is designed to
17 reduce the salaries of the Pennsylvania Gaming Control
18 Board by approximately $568,122.
19 In the interest of time, the majority of my
20 remarks will focus on how the Governor's more than
21 $26 million in misappropriated and shortsighted
22 funding cuts for both the Office of the Attorney
23 General and the Pennsylvania State Police could
24 negatively impact both of these law enforcement
25 entities' overall ability to ensure public safety and
17
1 successfully police Pennsylvania's newly implemented
2 slots law.
3 Well before gaming was expanded in
4 Pennsylvania in July 2004, members of the General
5 Assembly and the Governor were repeatedly warned about
6 the well-documented negative economic and social
7 effects of the implementation of casino gambling in
8 other states, such as increased organized crime,
9 political corruption, gun violence, gambling
10 addiction, bankruptcy, divorce, and domestic abuse.
11 How can we avoid the same losing propositions
12 with expanded gaming now a reality in Pennsylvania?
13 As former police sergeant of the Shaler
14 Township Police Department in Allegheny County, I must
15 concur with the conclusion of one of my constituents,
16 State Attorney General Tom Corbett, who maintains that
17 the best and only way to increase integrity and public
18 trust in our state's gaming industry is to have a
19 strong law enforcement presence in place.
20 Of course, in order to do that, Pennsylvania
21 must also have adequate law enforcement funding in
22 place. Best of all, as I will illustrate later in my
23 remarks, this critical task can be accomplished
24 without placing additional financial burdens on
25 Pennsylvania taxpayers.
18
1 Unfortunately, based on the number of law
2 enforcement line items completely removed from the
3 2007-2008 budget, it seems that public safety as well
4 as effective gaming oversight has been regulated to
5 the back of the line by Governor Rendell.
6 Recognizing that the Commonwealth has
7 extremely limited financial resources, the Attorney
8 General has requested a fiscally conservative
9 maintenance budget to ensure that the current staffing
10 level can be maintained with absolutely no new tax
11 increases.
12 However, if the Governor's proposed budget
13 goes through with its $4.4 million or 4.6 percent
14 funding cut, the Attorney General's Office stands to
15 lose approximately 77 positions. These include, but
16 are not limited to, drug law and drug law enforcement
17 task forces, the Child Predator Unit, capital appeals,
18 and tobacco law enforcement.
19 Also recognizing the inescapable reality that
20 expanded gaming and the associated potential for
21 increased corruption and organized crime are now a
22 very real possibility for this state, the Attorney
23 General has made an additional fiscally conservative
24 request for $799,000 in gaming enforcement funding
25 during the 2007-2008 fiscal year to begin operating a
19
1 Public Corruption Unit.
2 To that end, my first major piece of
3 legislation, House Bill 482, is specifically designed
4 to substantially address Attorney General Corbett's
5 request by:
6 One, reducing the annual salaries of the six
7 Gaming Control Board members from $145,000 to $64,178
8 and the Gaming Control Board chairman from $150,000 to
9 $66,810 to bring them in line with those in other
10 comparable state agencies such as the Liquor Control
11 Board.
12 Two, passing along those savings to the
13 Office of Attorney General, the state police, and
14 other independent state agencies that are responsible
15 for investigating and prosecuting public corruption
16 cases.
17 Alcohol and gambling raise similar types of
18 social concerns and the responsibilities and functions
19 of the Gaming Control Board are more closely related
20 to those of the LCB than those of other Commonwealth
21 boards and commissions that address totally unrelated
22 areas of government regulation.
23 If anything, some of the responsibilities of
24 the LCB are even greater since the LCB actually
25 operates a multi-billion-dollar industry while the
20
1 Gaming Control Board merely regulates such an
2 industry. The bottom line is that directors of
3 similar types of state agencies should receive similar
4 salaries.
5 Now that the licenses have been awarded and
6 many of the most important and difficult policy
7 decisions to set the slots law machinery into motion
8 have already been made, there is absolutely no
9 justification for these six-digit salaries today.
10 Collectively, these board salaries are
11 draining over a million dollars per year from slots
12 revenues that could be put to better use to hire more
13 law enforcement personnel to more effectively police
14 the slots law.
15 If enacted, my legislation contains an
16 effective date provision that immediately applies this
17 salary reduction to each board member. Once these
18 nearly $570,000 in savings are realized, they could
19 immediately be shifted to the budgets of the Office of
20 the Attorney General, the state police, and other
21 independent state agencies that are responsible for
22 investigating and prosecuting gambling and other
23 public corruption cases.
24 Another common-sense and fiscally responsible
25 way to improve the public's perception of the gaming
21
1 industry and also provide adequate law enforcement
2 funding with absolutely no tax increases would be to
3 completely shift all law enforcement agency functions
4 currently under the jurisdiction of the Gaming Control
5 Board to the state police to work in conjunction with
6 the Attorney General's Office.
7 Of course, the approximately $31.26 million
8 in state funding that the Governor has allocated to
9 the Gaming Control Board for gaming oversight should
10 be transferred in part to the Office of the Attorney
11 General and the state police for law enforcement.
12 Any additional revenue savings generated from
13 removing law enforcement jurisdiction from the Gaming
14 Control Board could be returned to state taxpayers in
15 the form of tax cuts, especially property tax cuts.
16 In conclusion, if the publicly stated mission
17 of the Pennsylvania General Assembly is to increase
18 integrity and public trust in our state's newly
19 expanded gaming industry, how can we refuse to provide
20 our law enforcement officials with the tools they need
21 to protect our citizens?
22 Moreover, if our state law enforcement
23 agencies are ill-equipped or understaffed to the point
24 where they cannot protect our citizens from organized
25 crime, illegal drugs, child predators, and other types
22
1 of corruption, none of our communities will be able to
2 prosper regardless of the final make-up of this year's
3 budget.
4 Put simply, without adequate funding to
5 ensure public safety, there is little hope for
6 Pennsylvania's future prosperity.
7 I look forward to working with the members of
8 this committee and the rest of state government to
9 find creative and cost-efficient solutions to maintain
10 the difficult balance between fiscal responsibility
11 and adequately funding essential government programs,
12 such as public safety and law enforcement, with no
13 additional tax increases.
14 Thank you.
15 REPRESENTATIVE KELLER: Thank you very much.
16 Representative Beyer.
17 REPRESENTATIVE BEYER: Good morning,
18 Mr. Chairman and members of the Appropriations
19 Committee. Thank you for your hard and diligent work.
20 I'm going to give you kind of a little laundry list of
21 things that I would like to bring to your attention.
22 Thank you very much, Mr. Chairman and members
23 of the House Appropriations Committee, for this
24 opportunity to share my thoughts with you on the
25 Fiscal 2008 budget blueprint that has been put before
23
1 us by the Governor.
2 We face significant challenges in the coming
3 fiscal year. And this blueprint, as proposed, has
4 ideas that are certainly worthy of serious
5 consideration. There are basic outlines for the
6 issues of healthcare, transportation, education, the
7 environment, and, certainly a major issue we have been
8 dealing with, meaningful property tax relief for our
9 hard working Commonwealth taxpayers. We are rounding
10 down to the end of the hearing process, and the
11 crafting and debate of the overall budget is soon to
12 begin on our legislative side.
13 There are areas in which we all agree. We
14 all agree that access to affordable, quality
15 healthcare for all Pennsylvanians is essential. We
16 agree that we shall continue to improve our
17 environment. We agree that we have to address our
18 transportation system and its proper maintenance, and
19 that very point, Mr. Chairman, was hammered home in
20 the recent St. Valentine's Day disaster.
21 The problem is, the Governor has put out a
22 blueprint on these issues and others but again has
23 left the heavy lifting to the Legislature. The
24 Governor has put forward a spending plan that contains
25 an increase of at least a billion dollars over fiscal
24
1 2007. The tax and fee increases total more than three
2 and a quarter billion dollars, and total spending in
3 this Commonwealth climbs to close to $28 billion.
4 The areas chartered for increases are raising
5 the sales tax to 7 percent; an oil company franchise
6 tax; approximately $77 million in new taxes on
7 cigarettes, cigars, and smokeless tobacco; $46 million
8 in tipping fees; business taxes of nearly sixty and a
9 half millions dollars coming from companies that do
10 not pay for healthcare coverage for their employees.
11 House Republicans have made proposals on
12 expanding the sales tax to go wholly toward property
13 tax relief. But in this instance, the Governor's
14 blueprint directs only half of the collected tax for
15 that purpose. It continues to be interesting to me
16 how our well-thought-out plans are pushed aside and
17 then suddenly Governor Rendell trots out a sales tax
18 proposal. Very interesting indeed.
19 This morning I would like to call your
20 attention to an extremely serious issue, not only in
21 my district but in many parts of our great
22 Commonwealth, school safety. You may recall the
23 recent revelations of alleged rapes that took place in
24 the Allentown School District. These acts have
25 saddened and sickened that community and have also
25
1 drawn Commonwealth-wide and, in some cases, nationwide
2 attention.
3 We are also aware of incidents of violence
4 that have taken place in Philadelphia, suburban
5 Harrisburg, Pittsburgh, and other communities. These
6 acts cry out for help and healing, and they also cry
7 out for action, action to protect our students,
8 faculty members, and staff in schools. That's why I
9 am here to make these proposals to you today.
10 We must retain funding for the Office of
11 State Schools Advocate. It is imperative that this
12 vital program remain in place. And to add to that, I
13 am proposing that we fund a safe school advocate for
14 school districts within cities of the second and third
15 class. No area, whether urban or rural, is immune
16 from these increasing acts of school violence. But we
17 must get help to these second- and third-class urban
18 areas where the lion's share of the acts are taking
19 place.
20 We must put a process in place that will
21 adequately deal with handling adjudicated youth within
22 our school systems, and there has to be a setting in
23 which memorandums of understanding can be reached
24 between the districts and the police departments that
25 serve them. That can be facilitated by the Office of
26
1 Safe Schools Advocate. The office can be a liaison
2 between schools and Children and Youth systems.
3 I also wish to call the committee's attention
4 to a couple of other very important issues today. The
5 United States Coast Guard Auxiliary, under the
6 auspices of the Department of Homeland Security,
7 continues its all-volunteer mission of providing
8 safety and security for our ports, waterways, and
9 coastal regions; and here in the Commonwealth of
10 Pennsylvania, they are actively involved with security
11 patrols and in boating safety instruction on the
12 Susquehanna and Lehigh Rivers, to name just a few.
13 A $50,000 line item in our budget is
14 necessary to help this great organization continue its
15 work. Senator Vincent Fumo, Democrat of Philadelphia,
16 has been funding this vital program in years past with
17 a grant from the Department of Community and Economic
18 Development. This funding stream of course, has been
19 at the discretion of the Senator, not the Fish and
20 Boat Commission where it belongs. I respectfully
21 request that $50,000 be allocated to the Fish and Boat
22 Commission exclusively for all Coast Guard Auxiliary
23 activities in our Commonwealth. This is a small
24 allocation and it would effectively serve thousands of
25 residents throughout the state.
27
1 Finally, Mr. Chairman and members of the
2 committee, the memories of the Valentine's Day snow,
3 sleet, and ice storm are still fresh and painful,
4 despite the moderating weather we are seeing now. On
5 that now fateful day, we saw part of our great
6 Commonwealth become literally paralyzed on three major
7 interstate highways due to a massive system failure in
8 coordinating clearing efforts. I have a question to
9 pose to you today.
10 We have been spending hundreds of millions of
11 dollars since 1999 on an 800-megawatt
12 Commonwealth-wide radio system, a system that enables
13 emergency agencies throughout the Commonwealth to
14 communicate with each other. I understand that in
15 this 2007 budget, approximately $120 million is being
16 requested by the Office of Administration.
17 I have also been informed that the Office of
18 Administration, who administers the financial
19 resources of this program, has summarily cancelled
20 events that would test the effectiveness of this
21 proposed system in Lancaster and Western Pennsylvania.
22 I urge the members of this committee to recall the
23 Secretary of Administration to question how these
24 dollars are being utilized and why this system has not
25 been in place after eight years.
28
1 Answers are not only needed, they are
2 demanded.
3 I thank you, Mr. Chairman and members of the
4 committee, for this time today and I wish you well in
5 the work that is ahead. I look forward to assisting
6 in giving my constituents and the Commonwealth of
7 Pennsylvania a budget that meets our needs and
8 respects the hard-working taxpayers.
9 Also, my final thing, I have introduced House
10 Bill 484. I introduced it last year. House Bill 484
11 is a new diesel technology tax credit. If this bill
12 is passed and funded, we would give businesses with a
13 $5,000 tax credit to purchase this new technology. I
14 have Mack Truck World Headquarters in my district, the
15 world's second largest manufacturer of heavy trucks.
16 It's a Pennsylvania, born and bred company. It's
17 based in Pennsylvania. It's owned by Volvo Group, but
18 everybody knows the Mack Truck brand.
19 It's so important that we incentivize these
20 businesses to replace their trucks. Sales for this
21 company have fallen off a cliff. And they have laid
22 off 450 workers. It's sort of an early warning that
23 we put this in place because the cost of this new
24 technology for businesses is prohibited and they are
25 deferring replacing their fleets because of it. It is
29
1 an increase of new technology between seven and ten
2 thousand dollars per truck.
3 What I'm asking is, why can't we give these
4 businesses a $5,000 tax credit? We employ people.
5 We're selling trucks. The state has no way other than
6 to benefit because we're now going to be receiving the
7 sales tax dollars on the sales of these trucks.
8 It would be the first of its kind in the
9 country. Pennsylvania would be a leader. Because if
10 we don't incentivize business, we're not going to
11 incentivize the environment.
12 We're telling businesses that if you buy
13 these trucks, they're not going to be as polluting
14 and, in fact, they're going to be cleaner and
15 healthier for all of us. It's a win-win for both.
16 I have capped it at $15 million because I
17 know we don't have all this money. How do we set it
18 up? I'm urging you to consider putting this into the
19 budget. This is a way to help tremendously -- it's a
20 Pennsylvania company -- not only a Pennsylvania
21 company but other companies that sell heavy diesel
22 technology.
23 Having said that, Mr. Chairman, I would like
24 to thank you and the members for this time today. I
25 wish you well in the work that's ahead. I'm not on
30
1 Appropriations and I don't envy you one bit. But I
2 look forward to assisting you and giving my
3 constituents in the Commonwealth of Pennsylvania a
4 budget that meets our needs and respects the
5 hardworking taxpayers of our great state.
6 Thank you very much, Mr. Chairman.
7 REPRESENTATIVE KELLER: Thank you. We have a
8 comment by Vice Chairman Dally.
9 REPRESENTATIVE DALLY: Thank you.
10 Representative Beyer, I want to tell you, you
11 made some excellent points. And on the issue of the
12 statewide radio system, I did question the appropriate
13 authorities on that issue when they came before us.
14 That's a concern of mine also.
15 I know on your tax credit bill, I think
16 that's a great proposal and something that I think
17 this Administration would embrace. Because I think,
18 despite their rhetoric, we continue to manufacture
19 jobs in this Commonwealth. So we have to do what we
20 can to maintain those positions and try to grow that
21 area of our economy. I don't see very positive steps
22 being taken in that regard. But your bill would do
23 that. Thank you.
24 REPRESENTATIVE BEYER: Thank you,
25 Representative Dally. I think it's a great first
31
1 step. By the way, this bill has been endorsed by the
2 UAW, Mack trucks, and every environmental group, to
3 volunteer firemen.
4 Representative Dally, on the 800-megawatt
5 system, I didn't realize that you questioned them on
6 that. I hope that the Appropriations Committee --
7 this is a substantial amount of money -- really
8 examines whether or not this money is being
9 appropriately allocated, why contracts are being
10 cancelled, why we don't have an effective system in
11 place. That's really important, I think.
12 REPRESENTATIVE DALLY: Thank you.
13 REPRESENTATIVE KELLER: Thank you. We're
14 over our time, but I would like to sit down and talk
15 with you further.
16 Thank you very much.
17 REPRESENTATIVE BEYER: Thank you.
18 REPRESENTATIVE KELLER: Representative Perry.
19 REPRESENTATIVE PERRY: Thank you for allowing
20 me to present my views as a first-term legislator.
21 And I gotta tell you, in this era of reform and
22 increased transparency -- not to be disrespectful with
23 you, but 45 copies of this is a little burdensome, you
24 know? I mean, 45 copies one after another that are
25 most likely going to end up in the trash. I mean,
32
1 pennies add up to dollars. That's a lot of spending.
2 REPRESENTATIVE KELLER: Before we go any
3 further, that's how many committee members we have.
4 REPRESENTATIVE PERRY: I understand. But
5 here again, if anybody ever wants to a copy, just ask
6 and I'm sure anybody would be happy to present them.
7 If we can base the near future on the recent
8 past, I and many Pennsylvanians are wondering how or
9 why this Governor and this government can be trusted
10 to live up to its claim of financial responsibility.
11 The Governor accuses oil companies of playing
12 a shell game while at the very same moment he is doing
13 precisely the same thing. He tells the taxpayers and
14 the press that his proposal increases overall spending
15 by 3.6 percent. Only after he moved many items out of
16 the General Fund can he claim this is a nearly
17 reasonable increase. Meanwhile, increased funding for
18 new and existing programs moved outside of the General
19 Fund make the overall increase closer to 7 or 8
20 percent.
21 The people of Pennsylvania should know the
22 truth and the truth is that since taking office, this
23 Governor has increased spending by $5.9 billion from
24 $20.4 billion. And with this year's proposed budget,
25 the increase in spending is $6.33 billion from the
33
1 year he took office. That's 34 percent.
2 He has proposed allowing the Pennsylvania
3 Turnpike to be leased to a private, possibly foreign,
4 company as a way to raise nearly $1 billion for road
5 and bridge maintenance. Citizens ask me, if some
6 foreign company can come to Pennsylvania and pay up to
7 $16 billion up front and still make a profit, why
8 aren't we able to make that money right now? Is our
9 turnpike being mismanaged? If so, why isn't this
10 Governor working on that problem so we have money for
11 our roads while we keep our turnpike, which we have
12 paid for many times over.
13 Now, oil companies should pay their fair
14 share from the profits they generate in the
15 Commonwealth. And taxing oil companies on their gross
16 profits to pay for mass transit is a great political
17 scheme. But does this Governor think we are naive
18 enough to believe that the oil companies won't just
19 pass those additional costs on to consumers at the
20 pump? Fining these companies for passing on costs
21 won't help consumers at the gas station. And
22 increased oil company costs won't help the state
23 employee's pension funds that have invested in oil
24 companies to the tune of $580 million.
25 Talk about a shell game. People in the
34
1 mid-state wonder why we are always forced to help fund
2 the state's entire mass transit budget while we here
3 only receive 1.57 percent of that budget. Meanwhile,
4 those who benefit directly from the state's two major
5 mass transit systems are rarely asked to pay a penny
6 more. If we in the mid-state have to pay for SEPTA
7 and the Port Authority of Allegheny County, then all
8 Pennsylvanians should be helping to fund the
9 Chesapeake Bay Initiative.
10 The Governor has proposed a new tax on
11 electricity to pay off $850 million in borrowing for
12 alternative power development and energy conservation.
13 If this is an investment, we want to know what the
14 return is. When will taxpayers reap the rewards of
15 this decision? And why hasn't the Governor told us
16 the actual cost to current and future taxpayers will
17 be more than $1.4 billion?
18 Who among us that is already in debt borrows
19 against our children's future to invest in programs
20 that have no prospect of financial return? Long
21 before I agree to throw taxpayer money at nameless,
22 faceless, out-of-state businesses, I would much rather
23 support alternative energy development and
24 conservation methods by empowering Pennsylvanians to
25 participate via initiatives.
35
1 Another shell game is the handling of the
2 Tobacco Fund. With Act 77, Pennsylvanians believed
3 that tobacco settlement funds were to be spent on
4 things like healthcare insurance for the uninsured and
5 disabled, smoking cessation programs, research, and
6 the like.
7 Last year, approximately $73.8 million and
8 interest earnings were redirected to offset General
9 Fund costs and free up more money for the Governor to
10 spend on his pet programs.
11 The point is that taxpayers are constantly
12 being asked to pay for something; then the money is
13 moved elsewhere and taxes have to be raised to make up
14 the newly created shortage. This practice does not
15 engender trust in our government's financial
16 accountability and discipline. It is a practice that
17 has to end.
18 To make matters worse, this governor now
19 wants to borrow against uncertain tobacco settlement
20 monies to fund more pet projects, once again leaving
21 taxpayers holding the bag long after he is gone.
22 Our Governor tells us he wants to increase
23 education block grants by $100 million, but he hasn't
24 told taxpayers in the mid-state that their schools
25 will be required to launch completely new pre-K
36
1 programs before being eligible to receive any of that
2 money. Since most of the mid-state won't launch new
3 un-needed programs, taxpayers here will be forced to
4 pay for another class of government dependents around
5 the state who will continually have their hands out
6 demanding we pay for this newly created socialized
7 daycare.
8 We are expected to support initiatives to
9 make curricula in high schools more rigorous by
10 providing laptops for special education students. On
11 the face of it, the intention seems quite admirable.
12 However, would taxpayers be willing to support this
13 expenditure if they knew the plan included a
14 sole-source contract through Lenovo to purchase
15 obsolete laptops from China? If we need these
16 computers, why are we not supporting American workers
17 by spending our hard-earned tax dollars purchasing
18 desktop computers made right here in the good old USA?
19 Among a long list of other new or increased
20 taxes and fees, the Governor has proposed a new 3
21 percent payroll tax on employers to pay for healthcare
22 coverage. As a business owner and person who has had
23 to make healthcare insurance cost decisions, I can
24 tell you that many employers will be very happy to pay
25 the new tax and allow their employees to receive
37
1 taxpayer-funded healthcare. I don't believe for a
2 moment that the estimated costs of this program will
3 not be quickly outpaced by the actual burden on the
4 taxpayer as it has in other states.
5 Now that all the state's combined welfare
6 spending has exceeded even the cost of education and
7 encompasses more than 35 percent of the budget, many
8 of the citizens I represent wonder why our welfare
9 costs have exploded since Governor Rendell took
10 office.
11 Pennsylvanians are generous people always
12 willing to offer a hand up, but our generosity has
13 been abused as evidenced by ever-increasing welfare
14 expenditures which have reached a staggering $10
15 billion in state spending.
16 Finally, this Governor has proposed
17 increasing sales tax by 17 percent and told you it
18 will provide a reduction in property taxes. It's
19 another shell game. Based on the Governor's proposal,
20 for every additional dollar we pay in sales tax, we
21 will receive only 30 cents in property tax relief.
22 The Governor fooled us by claiming that
23 state-sponsored gambling was going to provide
24 universal property tax relief. While many senior
25 citizens will receive some property tax relief from
38
1 gambling revenues, the fact is that those in the
2 middle class who may be struggling to send their
3 children to college and expect very little from state
4 government are, as of now, receiving nothing. They
5 and all Pennsylvanians deserve real property tax
6 relief.
7 Instead of increasing taxes and fees to fund
8 new programs, our Governor should be working to
9 relieve taxpayers and businesses of the crushing
10 weight of property taxation while finding solutions to
11 current vexing problems like the looming pension
12 crisis or COLAs for retired workers.
13 It is irresponsible and disrespectful to
14 offer this tax-increasing proposal to the citizens and
15 then say to the Legislature, Work it out. I think I
16 can sum up this budget's view of the 92nd District
17 when I tell citizens that it eliminates all money for
18 their senior center which will now be spent on more
19 government bureaucracy.
20 Leadership starts at the top and
21 Pennsylvanians demanded reform, transparency,
22 accountability, and fiscal discipline in the last
23 election. That demand included the Executive Branch
24 as well as members of the Legislature.
25 I respectfully suggest that the Governor
39
1 could do a great deal toward restoring confidence in
2 government and this institution by acting in good
3 faith, stop playing this annual shell game, and by
4 being completely forthcoming with the citizens of this
5 great Commonwealth.
6 Thank you again for taking the time to listen
7 to a colleague's view of the state budget.
8 REPRESENTATIVE KELLER: Thank you very much.
9 Representative Longietti, please.
10 REPRESENTATIVE LONGIETTI: Good morning,
11 members of the committee. Thank you for allowing me
12 to speak today.
13 This year, Governor Rendell presented a broad
14 budget proposal that addresses many of the issues and
15 principles important to the people of this
16 Commonwealth. I was encouraged by the dedication to
17 provide more funding for early education programs,
18 healthcare initiatives, and economic development
19 opportunities.
20 But I also understand that our goal as
21 elected officials should be to ensure fiscal
22 responsibility while crafting a budget that is fair
23 and that addresses the important needs of our
24 communities. That is why I am here today, to discuss
25 and advocate for a specific program that has been a
40
1 major asset to not only communities in Mercer County
2 but to communities across this Commonwealth.
3 I am speaking of the Weed and Seed Program,
4 which has been run by the Pennsylvania Commission on
5 Crime and Delinquency. The Governor's proposed budget
6 would cut this program by $492,000 in the next fiscal
7 year, of which I am opposed.
8 The Weed and Seed concept began as a federal
9 program in 1991, which focused on reducing crime and
10 poverty in large cities. Pennsylvania became the
11 first state to introduce a state-sponsored Weed and
12 Seed Program that focuses on smaller communities.
13 Currently, there are 15 Weed and Seed target areas
14 across the state, each of which have been documented
15 to make significant gains in dealing with the roots of
16 crime.
17 The goal of the Weed and Seed Program is to
18 make safer and revitalized neighborhoods through local
19 and state collaborative partnerships. It employs a
20 two-prong strategy: First, to weed out criminals who
21 participate in violent crime and drug abuse, and,
22 second, to seed in prevention, intervention,
23 treatment, and revitalization services to promote
24 community revitalization.
25 Weed and Seed is a community-driven
41
1 initiative. Target areas are selected where
2 grassroots organizations and local citizens are
3 motivated to accept responsibility for improving local
4 conditions.
5 The focus is to attack the underlying roots
6 that contribute to crime, such as unemployment, lack
7 of a quality education, and widespread poverty, and to
8 create order and opportunity. The participation of
9 these local leaders, using proven revitalization
10 strategies, makes Weed and Seed outcomes generational
11 and lasting concrete foundations within a community.
12 Oftentimes, local leaders come up with
13 innovative strategies designed to turn around their
14 communities. For example, Sharon/Farrell, which is in
15 my district, received the 2003 Weed and Seed Law
16 Enforcement Initiative of the Year Award for the
17 Operation Nightlight Program directed by the Mercer
18 County Juvenile Probation Office.
19 This program included police saturation
20 patrols in the targeted area and visibility patrols by
21 juvenile probation officers at youth-related evening
22 events to stem the tide of juvenile delinquency and
23 gang activity. At the same time, local ministers were
24 engaged to mentor identified at-risk youth to
25 eliminate criminal behavior and gang membership and
42
1 influence. As a result, infiltrations by New York-
2 and Detroit-based gangs were turned back.
3 The positive results in Weed and Seed target
4 areas have been marked. In Easton, York, and Chester,
5 crime was reduced by 20 to 60 percent in 2000, as
6 compared to the years before Weed and Seed was
7 introduced.
8 Targeted neighborhoods in the Pittsburgh area
9 experienced a reduction in crime of over 41 percent
10 due to Weed and Seed efforts.
11 The South Duke Street section of Lancaster
12 was revitalized from a magnet for the drug trade and
13 other crimes to a community where local officials,
14 non-profit organizations, and area banks worked
15 together to re-establish former businesses, attract
16 new businesses, rehabilitate homes, and address vacant
17 land and properties.
18 The Weed and Seed Program not only saves
19 communities, but it also saves money. For example,
20 the Sharon/Farrell Operation Nightlight Program
21 reduced juvenile probation days of care for the target
22 area by approximately 40 percent over a five-year
23 period, resulting in a cost savings of over $225,000
24 in actual dollars.
25 Adjusted for inflation, this one-year savings
43
1 would account for over half of the proposed $492,000
2 cut from the Weed and Seed Program contained in the
3 Governor's proposed budget.
4 Yet, these Operation/Nightline figures
5 represent but one of the 15 target areas across the
6 state. Therefore, I urge the Appropriations Committee
7 to closely examine and to restore funding to the Weed
8 and Seed Program, not only because it restores
9 communities but because these prevention dollars will
10 ultimately save a corresponding multiple of taxpayer
11 dollars spent through the justice system.
12 Thank you.
13 REPRESENTATIVE KELLER: Thank you.
14 Representative Gene DiGirolamo.
15 REPRESENTATIVE DiGIROLAMO: Good morning.
16 Thank you for the opportunity to be here.
17 Every day on TV or in the newspaper, we learn
18 about troubles of the latest celebrity or their family
19 struggling with alcohol and drug problems, about their
20 incarceration, hospitalizations, DUIs, and sometimes
21 death. In fact, the specifics are recounted in
22 incredible, agonizingly painful detail for all to see.
23 The suffering of the grieving families is all around
24 us and impossible to escape. I'm not going to mention
25 the celebrities because we all know who they are.
44
1 Alcohol and other drug addictions, of course,
2 is not reserved for celebrities. In fact, it is a
3 problem that affects one in every four families in
4 Pennsylvania and it is a serious, serious matter
5 indeed. For those who become addicted to alcohol or
6 drugs, the addiction will be fatal if it is allowed to
7 go untreated. I'm going to say that again. For those
8 who become addicted to alcohol or drugs, the addiction
9 will be fatal if it is allowed to go untreated.
10 According to the Health Department estimates,
11 over 800,000 Pennsylvanians have an untreated
12 addiction and are unable to get help; that is, over
13 800,000 of our neighbors, constituents, or friends has
14 a problem that will kill them if help is not provided.
15 Drug overdose deaths outnumber homicides, yet 800,000
16 Pennsylvanians need help and can't get it. What are
17 we doing?
18 I would just like to point out a couple of
19 articles that have been in the paper recently. This
20 was in the Philadelphia Daily News last year,
21 Representative Keller. Who Cries Out for the Junkies?
22 More Die by Needles than Bullets in the City.
23 Here's another article that was up here in
24 the Harrisburg Patriot-News recently. Crime Surge
25 Tied to Drugs and Guns. These are not problems, the
45
1 drugs and the violence and the guns, that are unique
2 to the city of Philadelphia or to Pittsburgh. It is
3 in every one of our neighborhoods. It's in Lancaster
4 County, Northampton County, Erie County, Bucks County,
5 all over our state.
6 Our counties have begun to cut back on
7 treatment because of lack of funds. They've begun to
8 ration treatment already with four months in the
9 fiscal year to go. Yet the toll of untreated alcohol
10 and other drug addictions is relentless and reaches
11 into one in every four families in each of our
12 legislative districts. One in every four families
13 among our neighbors, co-workers, and even among those
14 of us gathered here today knows about the heartache,
15 the suffering, and is struggling to help a loved one
16 at home with an alcohol or drug problem.
17 This is a peculiar illness. Its reach is so
18 long. You never know who is affected. You never know
19 what is happening even in the home of the member
20 sitting beside you.
21 I know, because a few years ago, it was
22 happening in my own home. You see, my oldest boy,
23 Gene, had a drug addiction. He was a heroin addict.
24 We struggled, me and my wife and the other members of
25 our family, every single day to try to cope and to
46
1 understand. Believe me, as a parent, maybe the worst
2 thing that could happen is that you could lose a child
3 but the second worst thing that could happen is having
4 a child that is addicted. Believe me, it's a
5 nightmare, a tornado roller-coaster ride that left us
6 bruised and empty. It was the darkest night I have
7 ever known. We struggled every single day to
8 understand what happened. We still do.
9 In the end, we were able to get help for our
10 son and I am proud to report to everybody that he is
11 seven years, almost eight years, into recovery. He's
12 married. He and his wife had our first grandchild
13 back in July. I like to think of recovery as a
14 miracle. It really is. It's a miracle.
15 I am so happy about this. But it is not
16 enough. It is not enough that my son or yours was
17 able to get help. We legislators can get things done
18 that others simply can't. It is not enough that we
19 can get help for our own. We cannot, must not, stop
20 here.
21 Let's properly fund addiction treatment
22 services. Let's set up a Department of Drugs and
23 Alcohol programs, put an agency in charge to lead this
24 battle of addiction. I've already introduced a bill.
25 It's House Bill 614. It was House Bill 1773 of last
47
1 session, which actually got a vote in the House and
2 passed almost unanimously.
3 My budget request is simple. We've lost
4 ground on the treatment front because of the loss of
5 federal -- and I want to highlight that -- the federal
6 IGT money, Intergovernmental Transfer Program.
7 Governor Rendell actually mentioned that loss in his
8 budget address.
9 I want to request $10 million for the Bureau
10 of Drug and Alcohol programs and the Department of
11 Health earmarked for treatment services.
12 And also I would like to request an
13 additional $500,000 to fund the Department of Drug and
14 Alcohol programs. Hopefully I can get that bill
15 passed and we can use that money for the program.
16 Thank you very much, Mr. Chairman and members
17 of the committee, for the time today.
18 REPRESENTATIVE KELLER: Thank you for that
19 heartfelt testimony.
20 Representative Metcalfe, please.
21 REPRESENTATIVE METCALFE: In this year's
22 budget address the Governor stated, quote, we are
23 gathered today to talk about the choices that we will
24 make together, this year and over the course of the
25 next four years, as we continue to put Pennsylvania on
48
1 the road to enduring progress, unquote.
2 The Governor claims that he is working to put
3 us on a, quote, road to enduring progress, unquote. I
4 believe that the Rendell road is better described by
5 Friedrich A. Hayek in the book that he first published
6 in March 1944 titled, The Road to Serfdom.
7 The road that Rendell has placed us on is one
8 of more economic power for the state and less economic
9 freedom for each individual Pennsylvanian. The
10 Governor continues to propose that the state take more
11 money from taxpayers through higher taxes, new taxes,
12 increased fees, and greater state debt.
13 Hayek wrote, "But when economic power is
14 centralized as an instrument of political power, it
15 creates a degree of dependence scarcely
16 distinguishable from slavery."
17 Can we trust that the Governor's defined
18 objective is really what he claims?
19 In the Governor's 2006 budget address, he
20 stated that, quote, we can achieve the goals set forth
21 in this budget without any increase in taxes, unquote.
22 At that time, the Governor proposed to increase
23 spending above and beyond the projected increase in
24 revenues.
25 I testified last year that he was trying to
49
1 convince us that the state could spend more than it
2 brings in but that taxes would not have to be
3 increased. I said, "He is setting us up for another
4 tax increase next year just as he did in December
5 2003." Well, next year is here, and what did the
6 Governor propose during his budget address on February
7 6, 2007? Tax increase, upon tax increase, upon tax
8 increase.
9 The Governor is proposing to increase the
10 state sales tax; the cigarette tax; and the tax on
11 garbage, known as the tipping fee. He is also
12 proposing to create new taxes on tobacco products, oil
13 companies, and businesses that do not provide
14 healthcare benefits for their employees.
15 This year the Governor proposes that we spend
16 $27.3 billion, almost a billion dollars more than last
17 year. The estimated growth of revenues for this
18 year's budget is only 2.3 percent compared to the 3.6
19 percent of increased spending proposed by the
20 Governor. Once again, as you can see, the Governor
21 wants to spend more than we have.
22 In addition to the increase in spending
23 reflected in the General Fund budget proposal, he
24 continues to move items that were funded through the
25 General Fund in the past into other funds for their
50
1 appropriations.
2 He also continues his reliance on one-time
3 revenue sources. The real spending increase in this
4 year's budget is much greater than the $27.3 billion
5 when you take into account the Governor's budgetary
6 sleight of hand. This year's budget would also
7 increase welfare spending by an additional $367.1
8 million.
9 One of the most troubling results of the
10 Rendell Road to Serfdom is that people continue to
11 vote with their feet as evidenced by our stagnant
12 population growth as we continue to lag behind the
13 rest of the nation.
14 A December 22, 2006, research brief from the
15 Pennsylvania State Data Center at Penn State
16 Harrisburg announced Pennsylvania's population
17 continues to grow more slowly than the nation as a
18 whole. The cost of the overhead of government for
19 Pennsylvania taxpayers is out of control.
20 According to the Pennsylvania Department of
21 Labor and Industry Center for Workforce Information
22 and Analysis, Pennsylvania's top 50 employers in order
23 are, No. 1, the federal government; No. 2, our state
24 government; No. 3, Wal-Mart; No. 4, the city of
25 Philadelphia; and, No. 5, the School District of
51
1 Philadelphia. That means that out of the top five
2 employers in Pennsylvania, only one, Wal-Mart,
3 actually generates tax revenue for the state rather
4 than consuming it.
5 The Governor misleadingly claims that his
6 economic policies have put us on the road to enduring
7 progress. In reality, his proposed 2007-2008 state
8 budget is not only a continuation but a reckless
9 acceleration of the same flawed tax, spend, and borrow
10 policies that he has made for the last four years.
11 His progress as defined by the results of his
12 actions is the growth of government. The policies of
13 the current Administration have increased government
14 spending, increased taxes, and increased debt. These
15 policies have placed a burden on our economy that has
16 clearly hampered our economic growth.
17 Again, they represent Pennsylvania's
18 modern-day Road to Serfdom. As Hayek correctly
19 summarized in the concluding chapter of his timeless
20 warning against government intrusion: "We must clear
21 away the obstacles with which human folly has recently
22 encumbered our path and release the creative energy of
23 individuals.
24 "The guiding principle in any attempt to
25 create a world of free men must be this: A policy of
52
1 freedom for the individual is the only truly
2 progressive policy."
3 The confiscation and transfer of wealth from
4 the hands of working citizens into the hands of
5 government has proven time and time again to have a
6 negative long-term impact on private sector
7 entrepreneurial endeavors that ultimately spur job
8 creation.
9 This year's budget should be a budget of
10 fiscal reform. This year's budget should return
11 economic freedom in the form of lower taxes to the
12 tax-paying men and women of Pennsylvania. This year's
13 budget should reduce spending and reduce the tax
14 burden on Pennsylvanians.
15 Thank you.
16 REPRESENTATIVE KELLER: Thank you,
17 Representative Metcalfe.
18 Representative Murt.
19 REPRESENTATIVE MURT: Members of the
20 committee, thank you for the opportunity to testify
21 today regarding the Governor's proposed budget for
22 2007-2008. I write to respectfully request that the
23 Governor's budgeted amount of $58,000 for the
24 Pennsylvania Tourette's Syndrome Association be
25 increased to last year's level of $100,000.
53
1 In the Governor's budget address on February
2 6th, many reforms for healthcare were proposed, but
3 sadly, there were cuts in funding for many areas in
4 healthcare, including Tourette's Syndrome. The
5 budgets from 2005-2006 and 2006-2007 allocated
6 $100,000 to cover research costs, tests for the
7 disease, treatment, and, most of all, for advocacy for
8 families throughout the Commonwealth. Many of these
9 families, who require advocacy, have no other place to
10 turn in their quest for help in finding an appropriate
11 educational program for their son or daughter.
12 With the new proposed budget allocating only
13 $58,000, almost half of what has been allocated for
14 the previous two years, many of these associated costs
15 will be placed upon the families of the patients. The
16 original $100,000 appropriation was not adequate, and
17 now by reducing it, we further adversely affect the
18 mission of this organization and the services that
19 these families who have a member with special needs
20 require.
21 This funding is critical to many families in
22 Pennsylvania. Initial doctor visits to determine
23 whether a child has Tourette's Syndrome are often of
24 frequent nature in order to track the symptoms that
25 the child is experiencing and then connect them to the
54
1 condition. Furthermore, extensive tests that include
2 MRI, CT, EEG scans, and blood tests to rule out other
3 diseases in the diagnosis stage are costly.
4 Additionally, in order to perform research
5 and studies to find the causes of Tourette's Syndrome
6 and to cure Tourette's Syndrome, funding is badly
7 needed. The association also provides statewide
8 community-based support for information, referral,
9 educational materials, individual education programs,
10 support groups, training, and workshops.
11 Mr. Chairman, in my opinion, the most
12 important mission of the Pennsylvania Tourette's
13 Syndrome Association is their advocacy on behalf of
14 children who have Tourette's Syndrome. Specifically,
15 this organization and their professional staff travel
16 the state, from Erie to Chester, and from Stroudsburg
17 to Pittsburgh, to help families who face difficulty in
18 working with their local school districts in finding
19 an appropriate educational setting or support services
20 for their child who has Tourette's Syndrome.
21 Mrs. Laura Umbrell, administrator of the
22 Pennsylvania Tourette's Syndrome Association, travels
23 throughout the Commonwealth every week to assist and
24 support families who badly need her assistance. Both
25 she and her staff provide this advocacy for families
55
1 who cannot afford legal counsel or a professional
2 advocate for their child.
3 Mr. Chairman, Mrs. Umbrell travels to your
4 hometown of Philadelphia every month to advocate for
5 families with a child or children who have Tourette's
6 Syndrome and need support in their dealings with the
7 School District of Philadelphia. Without appropriate
8 funding for this critically important advocacy, these
9 families will be denied the support they need for
10 their children. I know I ask for a small amount of
11 money, taking into account the multi-billion dollar
12 budget which you are working, but I cannot think of
13 another budget purpose more critically important than
14 this.
15 With all humility, I respectfully request
16 your support for full restoration of funding for the
17 Pennsylvania Tourette's Syndrome Association. Thank
18 you, Mr. Chairman and members of the Appropriations
19 Committee, for your consideration of my request.
20 Mr. Chairman, since I believe I still have a
21 few minutes, I wish to ask the committee to also
22 consider increasing the Governor's budget proposal of
23 $2.5 million for capital improvements to our 14
24 community colleges in Pennsylvania.
25 The Governor's budgeted amount is simply not
56
1 adequate to cover the deferred maintenance,
2 renovation, and new construction needs of our 14
3 community colleges in Pennsylvania.
4 This investment in capital projects is
5 required to continue to address the increasing repairs
6 to the physical plants of our community colleges, many
7 campuses that are now more than 40 years old.
8 This funding is also needed to empower the
9 community colleges to fulfill their critical transfer
10 and workforce development missions and also to build
11 for the future while serving the current educational
12 and training needs of a growing number of students.
13 Full funding for all the projects for
14 2007-2008 would require $16 million in state support.
15 This is, of course, not realistic in any budget year,
16 let alone this one.
17 Be that as it may, I urge the committee to
18 consider the community colleges' budget request of
19 $6.4 million in new capital projects for 2007-2008.
20 I respectfully remind the committee of our
21 community colleges enrolling more than 40,000 of our
22 residents at 47 campus sites throughout the
23 Commonwealth. I add that many of these students are
24 from the inner-city and from Pennsylvania's neediest
25 families.
57
1 I believe this is a wise investment by the
2 state. Thank you, Mr. Chairman.
3 REPRESENTATIVE KELLER: Thank you,
4 Representative Murt.
5 Representative Siptroth, please.
6 REPRESENTATIVE SIPTROTH: Members of the
7 committee, thank you for affording me the opportunity
8 to testify before the Appropriations Committee today
9 on behalf of my constituents in Monroe and Pike
10 Counties.
11 Let me begin by saying there are many
12 elements of Governor Rendell's budget proposal that I
13 find encouraging, despite the dismal position the
14 federal government has left us in by cutting funding
15 to programs Pennsylvanians depend on. But I am
16 confident where Washington has failed, Harrisburg can
17 succeed.
18 I am pleased healthcare has such a prominent
19 place on the Governor's agenda, and now the atmosphere
20 seems ripe with possibility to improve the quality of
21 life of every resident of the Commonwealth of
22 Pennsylvania.
23 I think we have the potential for a
24 constructive year on the horizon. However, in light
25 of the scaling back of IGT funds by the federal
58
1 government, I believe a primary task of the state is
2 to find the funds to support social services needed by
3 our residents.
4 My largest concern is regarding educating our
5 youth. While Pennsylvania has made extraordinary
6 progress and grand improvements in recent years to our
7 education system, I feel residents of my region are
8 still trailing our neighbors in the current equation.
9 Despite the nearly 3.5 percent increase in
10 funds for basic education, the additional 3 percent
11 for special education and important investments in
12 pre-kindergarten and renewed funds and increases for
13 accountability block grants, my local school districts
14 have problems using these resources effectively when
15 we face an even greater challenge.
16 Growth in Pike and Monroe Counties is
17 staggering. They are, in fact, two of the fastest
18 growing counties in the nation. And as more working
19 adults move into Pennsylvania from New York and New
20 Jersey, there are more families and thereby more
21 people to move on an already strained infrastructure
22 so roads need to be updated, children to educate,
23 children that require a top-notch education to get
24 ahead and to be prepared for the high-paying,
25 high-skilled jobs Pennsylvania is looking to attract.
59
1 Local districts are burdened by not only
2 educating the student body, but new facility
3 construction costs. Currently, local property tax
4 dollars supply 20 percent of our schools' revenue,
5 dwarfing state and federal support. Further, with the
6 large amount of undeveloped land, our school-age
7 population is likely to multiply, perhaps several
8 times.
9 The four school districts I represent,
10 Delaware Valley, East Stroudsburg, Pleasant Valley,
11 and Stroudsburg, serve over 27,000 students and the
12 number continues to multiply. One district has
13 indicated that debt service for the first time is the
14 No. 1 line item surpassing normal educational costs.
15 So while some schools in Pennsylvania are
16 able to build a new football stadium, refurbish
17 gymnasiums, or offer dozens of sports, we struggle for
18 classroom space and books. In the past session, I
19 hosted several meetings, roundtables, and hearings on
20 this issue.
21 At these gatherings, I received input and
22 feedback from State Education Secretary Gerald
23 Zahorchak; the president of the Education Policy and
24 Leadership Center, Ron Cowell; many of my House
25 colleagues; and the superintendents and business
60
1 administrators from each district. There is a
2 widespread understanding of our challenge and support
3 to find a solution.
4 In fact, I supported a bill in the last
5 session to allow for extraordinary growth supplements
6 for high-growth schools. Under the bill, 27 districts
7 would have qualified.
8 Again, Mr. Chairman, my district's
9 unrelenting population explosion demands additional
10 funding to succeed with the lofty goal of educating
11 Pennsylvania's next generation of nurses, police,
12 lawmakers, and parents.
13 I ask you and your committee to consider
14 granting supplements for rapid-growth school districts
15 in the Commonwealth and invite any member of the
16 committee to meet with me on this issue.
17 Thank you.
18 REPRESENTATIVE KELLER: Thank you.
19 We're a little ahead of schedule, so we're
20 going to take a break for the stenographer. We'll
21 call some members and see if we can get them down here
22 sooner.
23 (Break.)
24 REPRESENTATIVE KELLER: We're going to come
25 back into session now.
61
1 Representative Mantz, thank you for coming
2 down and jumping ahead of a couple of the other
3 people. We appreciate your cooperation. You may
4 start.
5 REPRESENTATIVE MANTZ: Thank you. Members of
6 the committee, I thank you for the opportunity to come
7 before you today. My reason for testifying is
8 two-fold: first, to offer my observations and
9 concerns about the Governor's budget proposal in
10 general and, second, to discuss a specific budgetary
11 issue impacting my district.
12 There are several things in this budget I
13 find troubling, but one of my greatest disappointments
14 is the continued failure by our Governor to adequately
15 address the need for genuine property tax relief.
16 Many people across this Commonwealth, and
17 certainly the people I represent in Berks and Lehigh
18 Counties, are vocally demanding real, and by that I
19 mean substantial, relief from skyrocketing school
20 property taxes, and certainly not the token relief
21 provided by Act 1 of 2006. While low-income seniors
22 could see as much as $650 in a property tax rebate
23 later this year under Act 1, most families will see
24 far less relief, and probably not until at least next
25 year, if not later.
62
1 In my own home school district, the Kutztown
2 Area School District, the Tax Study Commission has
3 recommended, and the school board has agreed, to place
4 a question on the primary election ballot seeking an
5 increase of 1.2 percent in the earned income tax.
6 However, any family earning more than $61,200
7 a year will end up paying more in income taxes than
8 they are saving in property taxes. In many
9 neighboring districts, the income threshold is even
10 lower. In other words, very few people will actually
11 see a reduction in their overall tax burden.
12 By including some money for property tax
13 relief in this budget, I believe the Governor is
14 acknowledging the glaring deficiencies of Act 1, but
15 once again, he is doing far too little to address this
16 very serious problem. School property tax elimination
17 is the remedy that our restive electorate, and
18 certainly a large segment of my constituency, is
19 demanding our Legislature effectively provide now.
20 Recognizing the momentum building around the
21 Commonwealth caucus plan and its efforts to eliminate
22 school property taxes in favor of a sales tax, the
23 Governor has, indeed, called for an increased sales
24 tax. But the sales tax revenues realized will only
25 help reduce, not eliminate, school property taxes.
63
1 Even more noteworthy, and equally disheartening, is
2 the fact that only about one-third of the $1.4 billion
3 collected from the Governor's increased 7 percent
4 sales tax will actually go back to homeowners for
5 property tax relief.
6 This is simply unacceptable. We need to
7 provide meaningful property tax relief now or, at the
8 very least, a credible and realistic school property
9 tax reduction plan culminating in the complete
10 abolishment of any reliance on property taxes to fund
11 public education. This unfair, inequitable, overly
12 burdensome tax, this vestige of economic feudalism,
13 born of the days when a person's wealth or means was
14 measured by the extent of his land holdings, must be
15 eradicated, sooner rather than later.
16 Also very disturbing to me is the high level
17 of spending that infects not only the General Fund
18 budget but the overall operating budget of our state
19 government as well. Taking this year's proposed
20 budget into account, spending during the Rendell
21 Administration, which began only four years ago, has
22 increased by more than $6.8 billion. This year alone,
23 the Governor is seeking $2.4 billion in increased
24 taxes and fees.
25 Simply put, the Governor is going in the
64
1 wrong direction with his budget proposal. He is
2 ignoring the public's outcry for lower spending and
3 less government. As elected representatives of this
4 Commonwealth, we must step in and bring his spending
5 under control.
6 I strongly support enactment of a taxpayer
7 bill of rights that would set necessary limits on how
8 much state spending may increase from year to year.
9 We expect Pennsylvania's families to live within their
10 means; we, as their elected government officials, must
11 do the same.
12 In closing, I would like to take a moment to
13 touch on a local issue of interest to the
14 Kutztown/Berks County area within my 187th Legislative
15 District. I previously submitted written testimony on
16 this topic and now refer you to that testimony for the
17 full details of my argument on this issue.
18 But to summarize, I am working with
19 Representative Scott Boyd to introduce legislation
20 asking the state to provide financial support to those
21 municipalities that either host within their
22 geographic borders or are in close proximity to the 14
23 state system universities. This subsidy will both,
24 one, help offset the increased demands placed upon the
25 local law enforcement budgets of these 14 SSHE
65
1 municipalities when school is in session and, two,
2 offset the suppressed collections of their respective
3 municipal earned income taxes.
4 The Borough of Kutztown is a wonderful place
5 in which to live; and without question, the university
6 contributes to the economy and quality of life we
7 enjoy in the area. However, the decreased local
8 income tax collections and increased demands on law
9 enforcement take their toll on our community and its
10 taxpayers.
11 I thank you again for the opportunity to
12 testify.
13 REPRESENTATIVE KELLER: I think we're going
14 to have to take another short break.
15 (Break.)
16 REPRESENTATIVE KELLER: Representative
17 Siptroth would like to correct the record, please.
18 REPRESENTATIVE SIPTROTH: Thank you,
19 Mr. Chairman.
20 I would like to correct the record. On page
21 2 of my testimony, local districts are burdened by not
22 only educating the student body, but new facility
23 construction costs. This is the correction.
24 Currently local property tax dollars supply -- this
25 should read 80 percent versus the previous testimony
66
1 of 20 percent.
2 REPRESENTATIVE KELLER: Thank you.
3 REPRESENTATIVE SIPTROTH: Thank you,
4 Mr. Chairman.
5 REPRESENTATIVE KELLER: We'll also take a
6 short break here.
7 (Break.)
8 REPRESENTATIVE KELLER: I would like to call
9 the committee back to order, please.
10 Representative Swanger.
11 REPRESENTATIVE SWANGER: Thank you,
12 Mr. Chairman and members of the committee, for
13 allowing me to speak here today. I bring greetings
14 from the people of the 102nd District in Lebanon
15 County, home of Lebanon Bologna in the heart of the
16 Pennsylvania Dutch Country. As a Republican true to
17 Republican principles of fiscal responsibility, I hope
18 you will consider my testimony while drafting your
19 2007-2008 budget proposal.
20 After defeating a 14-year incumbent last
21 year, I was sent to Harrisburg with a strong and clear
22 mandate from the people I represent; namely, reduce,
23 or at least limit, the growth of state spending and
24 vote against state tax increases of any type. State
25 budget increases of more than double the rate of
67
1 inflation have got to stop.
2 I personally heard nothing in the Governor's
3 budget address that mentions aggressive cuts in
4 wasteful spending. New state spending programs are
5 added each year, but it seems little is done to
6 evaluate existing programs to determine whether or not
7 they are effective. I believe we must reassess our
8 priorities and put our dollars where they are most
9 needed, that is, caring for our most vulnerable
10 citizens who are unable to care for themselves.
11 I urge every member of this legislative body
12 to think of themselves as elected tax collectors. We
13 must be very careful not to over-reach our legal
14 authority. I know there will be pressure to raise
15 taxes for new programs that have the same purpose of
16 old programs, but with newer names.
17 We must be very careful not to go down a path
18 that will limit solutions for potential revenue that
19 we can use to position Pennsylvania for a better
20 future, but I assure you I will be looking at every
21 option besides tax increases. We need to embrace new
22 ideas to manage our budget creatively by looking to
23 other states that have brought spending under control
24 and determining what works and what doesn't.
25 It is my hope that we can build a consensus
68
1 for a budget agreement by finding a way to live within
2 our means. I believe I was elected to deliver a
3 strong message to this committee and our Legislature
4 from the citizens of my district. They want the days
5 of tax and spend government in Harrisburg to be over.
6 As we begin to debate our budget, we must first admit
7 to ourselves that we have a spending problem, not a
8 taxing problem.
9 Before we ask our fellow citizens of this
10 Commonwealth to make more sacrifices for the common
11 good, isn't it fair to ask our own legislative body to
12 first look at cutting its own spending? Shared
13 sacrifice is a powerful argument in the court of
14 public opinion. Benefits such as retirement plans,
15 caucus services, per diems, and other legislative
16 perks should all be on the table. When I was a county
17 commissioner, we sometimes asked department heads to
18 cut 5 percent from their budgets in lean years.
19 Shouldn't Harrisburg do the same?
20 Also, we need to change the way Harrisburg
21 does business. One of my biggest frustrations as
22 county commissioner was dealing with unfunded state
23 mandates. This practice needs to be eliminated. All
24 mandates on local government should be funded by the
25 state with real dollars, not borrowed from some future
69
1 revenue source. Governor Rendell suggests the state
2 borrow at least $1.3 billion to finance his new
3 program expenditures. Our Legislature needs to be
4 strong enough to say no to this type of economic plan.
5 You may ask where I would propose cutting
6 state spending. In the few weeks that I have served
7 in this august body, I have learned that welfare
8 spending has now surpassed what we spend to educate
9 our children. Something is drastically wrong with
10 this picture. I would propose that we look at welfare
11 spending as a good place for budget cuts. Let me
12 emphasize I am not proposing that we turn the elderly
13 out of nursing homes. What I am proposing is
14 placement of those who are able to work in jobs that
15 will help them break the cycle of poverty, for keeping
16 people dependent on welfare is perpetuating poverty.
17 Thank you again for this opportunity to
18 convey my message. I look forward to being a part of
19 the solution for Pennsylvania, not the problem.
20 REPRESENTATIVE KELLER: Thank you,
21 Representative Swanger.
22 REPRESENTATIVE SWANGER: You're welcome.
23 REPRESENTATIVE KELLER: Representative Eddie
24 Day Pashinski.
25 REPRESENTATIVE PASHINSKI: Thank you, members
70
1 of the committee.
2 On behalf of the Healthcare Reform Task Force
3 organized by my office, I humbly submit the following
4 proposal for grant funding. The primary intent of the
5 proposal is to determine measurable and viable methods
6 of reducing the costs of healthcare delivery to the
7 people of the state of Pennsylvania.
8 The HRTF, established in my district, wishes
9 to demonstrate tangible evidence for the same, as well
10 as determine the feasibility of establishing a
11 statewide infrastructure to enable and enact the goals
12 of similar efforts that are in parallel with ours. We
13 envision the prototype for this system to be developed
14 and tested first within my district to gather credible
15 data on its true viability.
16 Other organizations, such as the Pennsylvania
17 e-Health Initiative, have been conducting research
18 into various aspects of these problems and are
19 organizing strategies that will eventually lead to
20 legislative recommendations. Our efforts intend to be
21 synergistic with theirs as well as the Governor's
22 GOHCR Prescription for Pennsylvania, and we wish to
23 collaborate closely and contribute to their efforts by
24 making our research available to them as well as other
25 concerned policy advisors and legislators within our
71
1 great state.
2 I and the HRTF hopes that the leadership will
3 respond favorably to this effort to better serve the
4 citizens of the state of Pennsylvania by assisting
5 healthcare professionals and consumers alike with
6 enabling methods and technology in order to reverse
7 the damaging costs trends in our state.
8 On page 1, go to background, just those two
9 paragraphs. The cost of healthcare continues to rise
10 at an unacceptable rate, placing an undue burden on
11 the individual healthcare consumer as well as the
12 small to medium business employer. It's likened to
13 that of a runaway freight train with no brakes.
14 Within the state of Pennsylvania, numerous studies
15 have indicated that the burden of these costs has
16 dampened the growth of the overall economy via various
17 consumer mechanisms, as well as reduced the
18 attractiveness of new business creation within the
19 state.
20 A unique opportunity to develop methods of
21 reversing this trend now urges exploration. The
22 Healthcare Reform Task Force of Northeastern
23 Pennsylvania, established by Representative Pashinski
24 and supported by various concerned organizations,
25 wishes to demonstrate tangible and reproducible means
72
1 by which healthcare costs can be reduced via the
2 implementation of best practices and emerging
3 technologies.
4 The study outlined within this document will
5 provide irrefutable evidence for the same and will
6 serve as a basis for legislative action. The
7 Healthcare Reform Task Force envisions the state of
8 Pennsylvania as the ideal success story in an area of
9 governmental action that has failed elsewhere due to a
10 lack of proper strategy. As outlined in the scope of
11 this proposal, only a multi-tiered and comprehensive
12 approach will serve as a foundation for broad-scale
13 adoption and goal realization. Until now most efforts
14 have been limited in scope and addressed only a
15 sub-sect of the overall problem. In other words,
16 they've only put the Band-Aid on the problem.
17 If you will now refer to the document titled
18 Northeastern Pennsylvania Healthcare Reform Task
19 Force. This Task Force is a volunteer commission that
20 I developed several years ago. Our statement is to
21 work in unison with our Governor's Prescription for
22 Pennsylvania. We intend to provide a proof of concept
23 for the plan to reform healthcare in our state. And
24 we want to create a model which will enable affordable
25 healthcare, provide quality healthcare, and make it
73
1 accessible to all Pennsylvanians.
2 A man once said, a chicken in every pot and a
3 car in every garage. It's time to modernize that. We
4 believe that basic healthcare is the right of every
5 citizen in the great United States of America.
6 Therefore, our goal is to make basic healthcare
7 available to all Pennsylvanians.
8 The history of the Northeast Pennsylvania
9 Healthcare Reform Task Force goes back over four years
10 ago. We put together this group of volunteers two
11 years ago. It is comprised of doctors, nurses,
12 lawyers, quality control/standard compliance,
13 healthcare administrators, information technology
14 experts, Internet security experts, academia, and
15 government policy advisors.
16 Our goal is to study the feasibility of a
17 simplified communications platform for healthcare,
18 demonstrate a viable solution prototype, and test
19 methods of cost reduction by implementing the
20 following technologies: electronic medical records;
21 regional health information network, better known as
22 RHIN; and disease management protocols.
23 What is the cost of hospital medical errors
24 and readmissions for complications and infections?
25 $965 million each year, over 20,000 Pennsylvanians
74
1 affected by avoidable hospital charges.
2 The next page. What is the cost of improper
3 chronic disease management? $1.7 billion. And I
4 would like the committee to notice that diabetes is
5 over $700 million. Diabetes is the kind of disease
6 that affects all the other organs and causes other
7 catastrophic problems. These are avoidable
8 hospitalization chronic diseases.
9 The next page. Healthcare costs are rising
10 yet Pennsylvanians are not getting better care or
11 getting healthier. $3.5 billion for the additional
12 days of hospital care due to potentially avoidable
13 hospital-acquired infections. $1.7 billion
14 hospitalizations that could have been avoided. This
15 is your oil change. We have come to know that 3,000
16 miles we should change the oil in our car. If we
17 practice proper management of these kinds of avoidable
18 diseases, we can save this kind of money.
19 $965 million for readmissions and certain medical
20 errors.
21 The next page. Let's find the fixes.
22 Address the inefficiency by implementing innovative
23 methods, reduce chronic care hospitalization by
24 implementing disease management protocols, and
25 eliminate common errors and costly redundancies
75
1 through secure and comprehensive information sharing.
2 What are our goals? Establish a testbed for
3 best practices and emerging technology. We want to
4 collaborate with other workers in this reform endeavor
5 throughout the state; produce credible substantiation
6 for a system for broad-scale information management
7 and exchange in a manner that is, one, cost effective
8 and uncomplicated to implement as well as maintain,
9 mission critical and highly available, and secure and
10 auditable; provide evidence that the Prescription for
11 Pennsylvania is a pragmatic and viable plan; recommend
12 legislative action to further the efforts of
13 broad-scale reform specifically in the areas of EMR,
14 electronic medical records, RHIN, regional health
15 information networks, and disease management.
16 The methods: Establish this RHIN prototype
17 in the district of 121; enable ten clinics to submit
18 to the RHIN via electronic medical records systems;
19 connect one hospital to the smaller clinical
20 environments via the RHIN; assess in real time the
21 benefits and weaknesses of the system -- and by the
22 way, the system can be up and running within 90 days
23 of approval -- provide disease management tools to
24 doctors to monitor chronic patients; and prove that
25 the combination of the above can reduce error, reduce
76
1 the costs, improve quality of care, and make high
2 quality care more accessible.
3 The next page offers you a diagram of what a
4 RHIN looks like. The problem in the past, they have
5 used electronic technology only in parts of the
6 system, never once connecting. There are only four
7 systems that connect in the entire United States of
8 America. The people that put this program together
9 sit on my volunteer commission, two brilliant people,
10 one a doctor, one a nurse, who have developed the
11 technologies.
12 How much will it cost? $875,000 for the full
13 pilot program, a small amount of money when you
14 consider we're spending over $6 billion in errors and
15 problems.
16 The return on our investment is higher
17 quality healthcare, better outcomes, improved
18 efficiency, and lower costs.
19 How can I prove it? IBM did it, on the next
20 page, in 2005 in Santa Cruz, California. If you'll
21 take a look at the column that says, as-is costs,
22 compare it to the real costs and notice the
23 percentages of savings. I say to you the smallest
24 percentage of saving was 50 percent and the highest
25 was nearly 90 percent in savings.
77
1 Next page. The grand total projected savings
2 for Santa Cruz before the RHIN was implemented,
3 $2,701,484 in costs; after the RHIN was implemented,
4 $563,698, nearly an 80 percent savings.
5 I'm offering you three ways. If this
6 committee and the Appropriations Committee suggest and
7 approve of this, we have a basic program for $375,000
8 which could connect one hospital with three clinics,
9 primary care only; an intermediate program which would
10 connect one hospital with five clinics -- this would
11 be your general medicine -- and deploy the RHIN; and,
12 last, which would be the most effective, is to connect
13 one hospital with ten clinics, all specialties and
14 deploy a regional health information network
15 prototype -- that, of course, is the RHIN -- and
16 monitor and collect the disease management protocol's
17 effect on quality and costs.
18 The next page identifies how the money would
19 be allocated. Phase I of the grant requirements:
20 Personnel -- that's Steering Committee. That's pro
21 bono -- honorarium for the Steering Committee is
22 $2,500 times 4; the Technical Advisory Board -- that's
23 UMI, the consulting principal. That's also pro
24 bono -- Honorarium for TAB; administrative assistants
25 would be getting $14.50 an hour times 2,000-plus
78
1 hours.
2 The equipment. We would need an Enterprise
3 Class Server of $14,000 and laptops for the various
4 physicians and the various satellites.
5 Supplies and expenses would be approximately
6 $1,000 per month. The consultants, Medical
7 Informatics, would be $25 an hour and the policy
8 development group would be $25 as well.
9 The incentive. Clinical information
10 infrastructure improvement grants, $25,000, to help
11 take the paper records and move it onto electronic
12 records, as well as the Hospital Information
13 Connectivity Grant, which would do the same. It would
14 take all the paper records that we would have
15 permission for and move them onto the EMR.
16 Future funding. Phase II. We could expand
17 this in Luzerne and Lackawanna Counties for $2.75
18 million.
19 Phase III. We could do seven counties in
20 northeastern Pennsylvania for $11.85 million; and for
21 the entire state, only $47 million.
22 When you take a look at that, it is a paltry
23 sum of money when you can save -- even if we only save
24 half of the $6 billion. This is a paltry sum.
25 I beg the chairman of this committee and
79
1 those that have the power to grant this to consider
2 the fact that we are all in a healthcare crisis. This
3 is a viable method that can help us get out of that
4 situation.
5 I thank you for your consideration and your
6 time. Thank you.
7 REPRESENTATIVE KELLER: Thank you,
8 Representative Pashinski.
9 REPRESENTATIVE KELLER: Chairman Stairs.
10 REPRESENTATIVE STAIRS: Thank you. This
11 committee has been pretty busy the last couple of
12 weeks. I appreciate the opportunity to speak to you.
13 I guess we had a snow delay a couple of weeks so you
14 had to reschedule your member presentations.
15 It's great to be here. I appreciate the work
16 the Appropriations Committee does. As we all know,
17 this is going to be a tough year. Of course, every
18 years starts out as a tough year. I guess we'll see
19 how tough it's going to be. With a lot of hard work,
20 I think we'll be able to address our needs.
21 I want to speak on some education issues.
22 And I'm just going to highlight my prepared remarks.
23 I know you hear a lot of long presentations. I'll try
24 to keep mine very brief. I do want to pull out some
25 numbers and just kind of refresh you with these so
80
1 when we begin our deliberations on education, we will
2 have some numbers.
3 A couple of concerns I have, to be begin
4 with, there's a program, $2.5 million, New Choices/New
5 Options. I support this program and it's been
6 eliminated. I will certainly join other legislators
7 to try to reinstate that program.
8 A big program I think that I have concerns
9 with is the job training and economic development. We
10 in Western Pennsylvania have noticed a lot progress.
11 A lot of monies have been allocated to increase and
12 enhance business and encourage growth. We're still
13 not there yet. We need a lot of help, particularly in
14 job training, dislocated workers, and preparing our
15 young people for the workforce. There's a cut that we
16 have to change.
17 One of my favorite projects -- and it's kind
18 of like a broken record -- is cut every year and we
19 reinstate it every year. We're going to have to go to
20 bat again for the Science in Motion program. This
21 originated at Juniata College, but it's pretty much
22 statewide. I say pretty much. There's a school in my
23 area that would like to become a part of this,
24 St. Vincent in Latrobe, because our area is not
25 included. I've seen firsthand what this does for
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1 rural education. It gives young people an opportunity
2 to see modern and high-tech instruments that their
3 schools cannot afford, the mobile lab coming around.
4 I'm going to be joining my rural colleagues in pushing
5 for help in reinstating money for Science in Motion.
6 Certainly good news, we're able to increase
7 basic education funding and higher education funding.
8 As you heard from the secretary as well as the
9 different institutions, the public institutions in our
10 state, there's always greater needs than what we can
11 provide. I think we made a good start. If we can go
12 beyond that, I applaud that. I know we do have a
13 tight budget.
14 The thing that really concerns me -- and I
15 think it is kind of a dire thing that we're seeing --
16 is when the Welfare Department and their programs,
17 very worthwhile programs, exceed that of the programs
18 in education for children's education. It appears to
19 be the first time now that this has happened. We've
20 always endeavored to make sure that education was the
21 No. 1 item in our budget. We're seeing a change
22 there. I know the needs are there for welfare and
23 health services in that area. But we cannot take one
24 moment to back down from helping education.
25 The Block Grant Program, which is increased,
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1 is probably the most popular education program that we
2 have initiated in recent years. The school districts
3 really have adopted this quite well. They like the
4 idea of giving state money with no strings attached.
5 I think for the most part they know how to better
6 spend it than we do in Harrisburg. We're getting, I
7 guess you'd say, the most bang for our bucks in that
8 area.
9 One concern I do have is with the increase in
10 the Block Grant this year, $100 million. Some of that
11 goes towards a competitive grant program. I'm all for
12 competition. I think that that brings out the best in
13 us. And also, being very realistic, in many of our
14 poorer districts, whether they're rural or industrial
15 areas of the state, they just can't afford to have a
16 person that competes in the grant writing process.
17 Maybe we can work it out to make that a little bit
18 better.
19 In my last comment I want to talk about
20 PHEAA. This is something that has really been very
21 beneficial to our college students and to our higher
22 education students. The Governor held this, I guess,
23 at last year's level. You know, the more money PHEAA
24 is able to receive from the state, we can continue the
25 grants.
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1 PHEAA is unique. When I first got on the
2 PHEAA board maybe 15 years ago, we were -- I don't
3 like to use the word a basket case -- but we were
4 financially coming to the state and asking for money
5 to operate PHEAA. Well, with good management, good
6 board members, good employees, and with the state
7 helping out, PHEAA is able to be a national
8 organization doing higher education and work in other
9 states, generating millions of dollars, which we're
10 able to bring back to Pennsylvania and to help not
11 only students who are of traditional school age but
12 also veterans serving abroad now are getting
13 forgiveness on loans. We have to make sure that not
14 only our young children are getting a good start --
15 the Governor proposes preschool education -- but also
16 make sure that our higher education is getting help
17 also.
18 I just wanted to point out a few things. I
19 know this is going to be an interesting budget year.
20 I want to make sure that some of my thoughts are on
21 the record. I look forward, as I serve on the
22 Education Committee, to work with you as we not only
23 do the budget on education but the whole budget this
24 year.
25 Thank you very much for your kindness.
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1 REPRESENTATIVE KELLER: Thank you, Chairman.
2 Representative Mike Sturla.
3 REPRESENTATIVE STURLA: Members of the
4 Appropriations Committee, thank you for the
5 opportunity to testify today about the 2007-2008 state
6 budget.
7 I am here today as the Representative of the
8 96th Legislative District, which includes the city of
9 Lancaster, but I am also here as a Representative
10 sworn to serve all the citizens of Pennsylvania.
11 Today I am asking for equity in property taxes, equity
12 in education funding, equity in transportation
13 funding, and equity for municipalities in terms of how
14 they pay for and provide local police and fire
15 protection for their citizens. This is not about
16 urban versus rural or rich versus poor or Republican
17 versus Democrats. This is about equity for all
18 Pennsylvanians.
19 Like Governor Rendell, I believe we must
20 build on our historic property tax relief and work
21 hard to ensure that more Pennsylvanians qualify for
22 property tax relief. Quite frankly, at this juncture,
23 I am less concerned with which tax we increase to
24 shift the burden and reduce homeowners' property taxes
25 than I am with how that relief is distributed once the
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1 shift occurs.
2 For many years now, citizens in
3 municipalities and school districts with a
4 disproportionate amount of tax exempt properties have
5 shouldered more than their fair share of the property
6 tax load. Whether it's forest lands, universities,
7 homeless shelters, or other non-for-profit agencies,
8 these municipalities and school districts often are
9 host to an array of services that benefit constituents
10 outside their borders but do not share the loss of tax
11 revenue.
12 As a result, I propose that any new revenue
13 generated to shift the burden from property taxes
14 first address the inequities present in these
15 situations. I know Representative Walko and others
16 have proposed payment in lieu of taxes, PILOT,
17 legislation to deal with this issue in the past and I
18 encourage the committee to adopt this as part of any
19 tax shift plan. This affects cities, boroughs, and
20 rural townships alike. It is a matter of fairness.
21 Governor Rendell should also be commended for
22 proposing a 3.47 percent increase for basic education
23 funding and a 3.1 percent increase for special
24 education. We all know that a quality education is
25 the key to ensuring that children have a successful
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1 career and future. We must continue to increase their
2 learning opportunities, but we must do it as equitably
3 as possible. As a result, we need to make sure that
4 additional state funding is going to the school
5 districts that need it most, especially in the area of
6 special education.
7 The state's current formula, based on
8 statewide special education figures, treats every
9 school district as having 15 percent of their students
10 in special education regardless of whether they have
11 less or more than that amount. This formula was
12 established in the early '90s as part of an attempt to
13 curb the rising cost to the state for covering excess
14 costs. This means that a school district with 10
15 percent of their students in special education gets
16 funded like they have 15 percent and a school district
17 with 25 percent of its students in special education
18 gets only 15 percent.
19 This could be corrected by changing the
20 formula to reflect actual numbers in each district
21 without additional funding. The statewide average
22 would still be 15 percent, although there would be
23 some winners and losers under this scenario. Until we
24 can change this inequitable funding stream, I
25 recommend that the additional $29.1 million in the
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1 proposed budget should only go to school districts
2 that have been identified as having 15 percent or more
3 students in special education.
4 This method was adopted in several of
5 Governor Ridge's budgets for additional special
6 education funding. It guarantees that districts
7 struggling with high numbers of special education
8 students are helped without taking dollars from those
9 districts that have benefited for years from the
10 current inequitable formula. Again, this affects
11 urban, suburban, and rural school districts throughout
12 the state and it is a matter of equality and fairness.
13 With Pennsylvania in the midst of a
14 transportation crisis, I feel it is time we take a
15 good hard look at how we fund roads in Pennsylvania
16 and which roads we fund. Rather than sell off or
17 lease an asset that the state owns that currently has
18 the potential to not only fund itself but generate
19 additional revenues, I believe we should divest
20 ourselves of those roads that have a cost/benefit
21 ratio that cannot be justified, the roads less
22 traveled, if you will.
23 I propose offering the least traveled roads
24 in the state to local municipalities and county
25 governments, free of charge, with the option of
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1 closing the road completely if the locals feel there
2 is no longer a need for the road. I would propose
3 that the state divest itself of an amount of roads
4 equal to the recommended $965 million annual increase
5 needed to properly maintain the current system.
6 Our Commonwealth has some of the best back
7 roads in the country, but should the state really be
8 responsible for these roads while well-traveled roads
9 decay and are listed as some of the worst in the
10 country? Vehicle miles, not lane miles, should
11 determine what the state maintains and we should only
12 maintain those roads that we have the money to do
13 currently.
14 I believe Pennsylvania's municipalities
15 deserve fairer funding in terms of firefighters and
16 police protection. I applaud Governor Rendell for
17 continuing his proposal of $25 million for volunteer
18 firefighters, but why must our paid municipal
19 firefighters be overlooked yet again? I am not
20 suggesting we touch any of the volunteers' money.
21 Rather, I am merely advocating a bill that I
22 will be re-introducing this session to establish an $8
23 million grant program for paid fire, emergency service
24 organizations, and rescue squads to ensure they too
25 are receiving the best equipment and safety gear
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1 possible. Because of the close proximity of row
2 houses, many municipalities do not have the option of
3 relying on volunteer fire departments and should not
4 be penalized for stepping up to the plate to provide
5 paid service.
6 Regarding police protection, if the 75
7 percent of the state's population that pays for their
8 own policing through local taxes is going to continue
9 to subsidize police protection for areas that do not
10 provide a local policing presence, then I think the
11 fine monies generated from state policing should go to
12 help offset the costs, not into the pockets of the
13 local municipality that does not provide any service.
14 I will be re-introducing a bill that would
15 phase out fine monies over a five-year period to
16 prepare some municipalities for this loss in revenue.
17 This would be a ten to fifteen million dollar cost
18 savings for the state, even though the cost of
19 providing this free service to 25 percent of the
20 state's population exceeds $300 million per year.
21 In closing, I would urge the Appropriations
22 Committee to look at this sort of in a broader view
23 throughout the state, not only in these programs but
24 others.
25 Thank you for your time.
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1 REPRESENTATIVE KELLER: Thank you,
2 Representative Sturla.
3 REPRESENTATIVE STURLA: You're welcome.
4 REPRESENTATIVE KELLER: This draws to a close
5 the Appropriations Commitment hearings on the budget.
6 I would like to thank everyone. I guess our work is
7 done. Of course, for Miriam and Ed, the hard work
8 begins today. Thank you for all the help you have
9 given us.
10 Thank you.
11 (The hearing concluded at 11:40 a.m.)
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1 I hereby certify that the proceedings
2 and evidence are contained fully and accurately in the
3 notes taken by me on the within proceedings and that
4 this is a correct transcript of the same.
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8 ______Jean M. Davis, Reporter 9 Notary Public
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