PolicyBlog

Senate Seeks to End Generational Theft

Commonwealth Foundation — Thu, 31 May 2012 15:10:00 EST

This week, Senate Majority Whip Pat Browne, Sen. Mike Brubaker, Senate Appropriations Chair Jake Corman, and Senate Majority Leader Dominic Pileggi announced plans to introduce pension reform legislation. The new plan would put all new participants in SERS, which includes state workers and state legislators, and PSERS, which includes public school and other covered employees, hired after Dec 1, 2012 into a defined contribution plan, like a 401(k).

Defined contribution plans protect taxpayers and benefit participants because they can provide competitive, predictable and current benefits—meaning liabilities cannot be deferred onto future generations. The big flaw with the current system, a defined benefit pension, is not so much the generosity of the plan, but the mixture of pensions and politics.

When investments do well, lawmakers have political incentives to enhance benefits (even retroactively) for active members and retirees. However, when investments lag, taxpayers are forced to pay more, and lawmakers again have perverse incentives to kick the can down the road and push the costs onto future generations.

This was indeed a major part of the "reforms" passed in 2003 and 2010 which delayed "unaffordable" payments, only to require higher payments in the future. Such deferral strategies received the full support of a number of groups, including organized labor and many elected officials, since this freed up money for other uses and everyone knew these plans would eventually have to be made whole.

The day of reckoning has arrived, as taxpayer contributions for state and school employees' pensions are expected to rise from $1.7 billion to $6.1 billion over the next 5 years. That increase comes to an additional $1,000 per Pennsylvania household in a combination of state and local taxes.

To be sure, the proposed Senate reforms would not erase the massive liabilities already accrued. Rather, they would prevent future manipulation, fiscal catastrophes and continuation of generational theft.

While government union bosses claim 401(k)-style retirement plans—which are standard in the private sector—are an insult to employees, defined contribution plans can indeed be just as favorable as traditional plans, and have many additional benefits for workers. For more on this, see our pension resources page.

For more on the proposed pension reform, see a news clip from ABC 27 and check out CF Senior Fellow Rick Dreyfuss's appearance on PCN-TV's call in show.

While more can be done to address the pension and retiree healthcare crisis, including reforming local government pension plans and looking at future benefits for current employees, the Senate's proposal represents an important start to addressing the pension crisis.

Here are the Commonwealth Foundation's Five Principles for Pension Reform:

Establish a Unified Defined Contribution plan for new state and local government workers, school employees, judges, and legislator.
Prohibit pension obligation bonds or other post-employment benefit (OPEB) bonds on a statewide basis.
Mandate pension and OPEB liability management reforms for current and any newly created liabilities.
Consider modifying unearned pension benefits to the extent legal and feasible.
Consider funding reforms only after prior steps are achieved.

Appropriations Chair Endorses Spending Limits

Commonwealth Foundation — Thu, 31 May 2012 11:55:00 EST

Last week in his remarks at the Pennsylvania Press Club, Sen. Jake Corman endorsed the idea of spending limits for Pennsylvania state government. Corman expressed support for Sen. Mike Folmer's proposed legislation, similar to Colorado's Taxpayer Bill of Rights (TABOR), which returned billions to taxpayers and fostered an economic boom in the Centennial State. Pennsylvania Independent takes a look at Sen. Corman's remarks, and the implications for Pennsylvania.

In addition to Sen. Folmer's proposed Taxpayer Protection Act (SB 7), two similar proposals have been introduced in the House: HB 974, sponsored by Rep. Scott Perry, and HB 116, sponsored by Rep. Tim Krieger, which would amend the state constitution to limit future spending.

Spending limits are needed, as we've pointed out before, because lawmakers work under perverse incentives to spend every dollar available to them in good times, resulting in unsustainable growth in spending and tax increases (or in rare cases, spending cuts) during recessions. Indeed, the budget passed by the State Senate this month spends $300 million more than expected revenues, using up much of the state's fund balance.

If state spending limits like the Taxpayer Protection Act had been in place since 2002, allowing spending to increase with inflation and population growth, General Fund spending would be $26.8 billion next year. Moreover, spending would have increased at a steady, sustainable rate, and taxpayers would have kept billions of their own dollars—almost $8,000 per family of four.

For more on spending limits, check out our BudgetFacts: State Spending Limits for Pennsylvania.

Nearly One Million Found in Out-of-State Welfare Fraud!

Commonwealth Foundation — Wed, 30 May 2012 17:29:00 EST

The facts are starting to get in the way for critics of welfare reform. By reviewing just three months of non-contiguous out-of-state EBT card transactions (November 2011 to January 2012), the Pennsylvania Department of Public Welfare uncovered 653 cases of out-of-state welfare fraud, saving taxpayers $970,107.

While this is a small fraction of the $2.6 billion spent on food stamps in Pa. this year, it's nothing to scoff at given the small sample of cases examined. After all, any amount going to those working the system robs the truly needy.

The EBT card review is just the latest in a long line of waste, abuse and fraud efforts by the Department of Public Welfare. Last summer the department sifted through hundreds of thousands of backlogged Medicaid eligibility reviews and found over 100,000 ineligible individuals were collecting benefits, some of them deceased. In the fall, the department created the Office of Program Integrity and is collaborating with the Office of Inspector General to pursue SNAP (food stamp) and cash assistance (TANF) overpayments throughout the year, but there is much more to do.

As Auditor General Jack Wagner noted, our fraud problem is extensive. We'll get a better idea of how prevalent food stamp fraud is after DPW completes reviews of EBT card purchases in neighboring states. In the meantime, the House should consider HB 1948, sponsored by Tim Krieger, to establish the Electronic Benefit Transfer (EBT) Card Management Program, which develops controls and procedures to identify EBT card fraud and abuse.

Fraud, waste and abuse in the welfare system is a big problem. That's why our February welfare report recommends aggressively ferreting out waste, fraud and abuse to protect benefits for the truly needy and encourage the ultimate goal of independence.

Readers Ask, We Answer: Education Spending

Commonwealth Foundation — Wed, 30 May 2012 10:20:00 EST

A reader asked us to help clarify the claims of Yinzercation blog on state education subsidies. The blogger claims the Corbett administration is being disingenuous about state K-12 education subsidies when they say they are returning education spending to pre-stimulus levels.

The gist of the Yinzercation post is this:

In 2008-09 (pre-stimulus), under Gov. Rendell, the state spent $9.597 billion on PK-12 education ("basic education").

In 2011-12, under Gov. Corbett, the state spent $9.225 billion on PK-12 education ("basic education").

Big problem here—the 2008-09 spending numbers included stimulus funds, $1.2 billion to be exact. And while most of the federal aid was earmarked for Medicaid spending, it freed up state dollars to be spent elsewhere (like education). And subsequent increases of state tax dollars for Medical Assistance has crowded out other areas of spending.

The actual last pre-stimulus year was 2007-08, when the state spent $9.328 billion on PK-12 education. The 2011-12 budget represents a reduction from 07-08, but only a 1.1 percent cut. For 2012-13, Gov. Corbett proposed $9.588 billion, or a $260 million increase over pre-stimulus spending levels.

When Districts Choose, Kids Lose

Commonwealth Foundation — Tue, 29 May 2012 16:16:00 EST

What if you were awaiting a letter to find out where local officials were going to send your child to school next year? What if one of the possibilities was a school that had more violent incidents than days of school?

Last month, Erie School District announced the pending closure of three elementary schools and the elimination of grades six through eight at three other schools. One of the closing schools is Burton Elementary School, which was in the bottom 5 percent of schools in academic performance in the 2009-10 school year, when it also had the dubious distinction of being the fifth most violent school in Pennsylvania (a fact which the Erie School District superintendent publically scoffed at when confronted with a CF report on school violence last fall).

Closing one of the most violent elementary schools in the state doesn't rid Erie of failing schools, though. In the 2010-11 school year, seven schools in Erie School District failed to have more than 60 percent of their students at grade level in reading. At these same seven schools, 670 violent incidents were recorded in just one school year.

As schools close and attendance boundaries change in the Erie School District, parents are left with little to do but wait and see where district officials will send their children. For many, where these lines are drawn is a matter of failure or success, safety or compromise. "Basically, we had no choice," Laura Anderson told the Erie Times-News. "My daughter would have gone to Wilson (Middle School) over my dead body."

Sound dramatic? Think again. Last school year, Laura Anderson's daughter would have had a one-in-two chance of being involved in a violent incident at Wilson Middle School. More than 250 violent incidents were recorded in the school that year. Anderson is choosing to send her daughters to a private school instead.

Unfortunately, the district didn't announce the closings and boundary changes until weeks after deadlines for the Catholic Diocese of Erie and Earned Income Tax Credit scholarships, making it impossible for those without the financial means to afford a private school to choose a safer option. As it stands, parents have yet to find out where their children will be assigned. The district says parents will be notified by June 30.

Without school choice, students in Erie School District - and in failing schools throughout the state - are at the mercy of the five digits in their ZIP code. With school choice, parents in Erie could rest assured that they have chosen the safest and best school for their child, regardless of what schools close or where new boundary lines are drawn.

$27B + $15K = What?

Commonwealth Foundation — Tue, 29 May 2012 15:24:00 EST

The Pennsylvania Department of Education recently released school financial data for the 2010-11 school year. The latest data shows public school spending and revenue increased yet again in 2011, reaching $27 billion statewide. Public school revenues were $26.9 billion, while expenditures were $26.6 billion.

Since 1995, school revenues grew by 108 percent (or 45 percent after adjusting for inflation). In 2010 dollars, revenue per student grew from $10,000 in 1995-96 to more than $15,000 last year.

As mentioned last week, school district fund balances also grew, to $3.2 billion.

How YOU Benefit if Lawmakers Act on Corrections

Commonwealth Foundation — Tue, 29 May 2012 12:01:00 EST

Correcting the commonwealth's criminal justice system is urgent. This is why Gov. Tom Corbett made it clear that he wants to see reform legislation on his desk by June 30. We couldn't agree more with the Governor.

The ailing corrections system can do better for communities, taxpayers and offenders. Here's a look at how it misses the mark:

Communities: Nearly 45 percent of Pennsylvania parolees released into communities return to prison within three years, making for a "corrections" system that simply isn't correcting.
Taxpayers: The breakdown in our corrections system caused the prison population to skyrocket, demanding more state prisons, staff and tax dollars. This unsustainable growth in corrections spending is part of the four-alarm fire that threatens Pennsylvania's fiscal house.
Offenders: Kyle was kept incarcerated, after being granted parole, an extra 100 days because he couldn't pay a $13.70 fine. This prevented him from rejoining his 4-year old daughter and the workforce, plus housing Kyle this extra time cost taxpayers more than 100 times the amount of the fine.

State corrections spending is unsustainable and fails to deliver acceptable results. Corrections Sec. John Wetzel is leading the charge for meaningful reform by not seeking an increased budget for the first time in a decade. Flat funding is possible only because the Department's budget includes $2.8 million in savings expected from legislative changes.

The Justice Reinvestment Initiative (JRI) workgroup has thoroughly researched the state's criminal justice system, vetted and proposed Pennsylvania-specific data-driven solutions. You can find a summary of the recommendations here.

The JRI recommendations could be introduced in a new bill introduced or amended into SB 100, which addresses some of the same issues and currently sits in the House Judicial Committee. With few session days left before the budget deadline, legislators must act quickly to meet Gov. Corbett's important deadline.

Passing the JRI reforms along with SB 100 means you would benefit by living in safer communities, where more offenders are rehabilitated to become productive members of society. Corrections reform also means less of your hard-earned income would be taken away in taxes, and the dollars you already contribute to the corrections system could have more impact.

States such as New York and Texas have embraced similar policy changes, significantly reducing both their crime and imprisonment rates over the past decade. These states and others demonstrate that corrections reform can improve public safety while saving tax dollars.

The Booze Business is a Lose Business for Taxpayers

Commonwealth Foundation — Thu, 24 May 2012 17:33:00 EST

I heard on the radio this week another ridiculous ad against allowing retail stores to sell wine or liquor, funded by UFCW dues to play on stations across the state.

Today's myth/lie that deserves busting is the idea that the state-run liquor stores "generate $500 million a year for the state budget and all taxpayers."

They don't! State liquor stores collect $500 million from taxpayers and consumers. More than 80 percent of that money is generated directly from taxes on buyers—both alcohol taxes and sales taxes. The rest comes from the standard "markup" the Pennsylvania Liquor Control Board (PLCB), the government monopoly retailer, puts on every bottle they sell.

The PLCB wants you to believe that without them, this revenue dries up. Truth is: Privately-owned liquor stores would collect taxes just the same.

Moreover, the PLCB is losing money. The newest financial report confirms that government in the booze business is a lose business. The PLCB ended the 2011 fiscal year with negative $31 million in net assets, having lost $23 million in 2010-11, and $54 million in 2009-10.

Guess who's responsible for paying off those debts? Remember once again, every dollar the PLCB generates is money taken from consumers and taxpayers.

For more on the failure of government-run liquor stores, visit FreeMyDrink.com. And for more on how the UFCW uses government-collected union dues for political action and to enrich union bosses, check out our policy report The Squeeze.

Gov. Corbett Is Right: Real Corrections Reform, Right Now

Commonwealth Foundation — Wed, 23 May 2012 15:12:00 EST

We here at CF are proud to be part, along with Gov. George M. Leader, his family, and many others, of a transpartisan coalition favoring "real corrections reform, right now." That is why this morning, I attended the release of the recommendations of the Justice Reinvestment Initiative working group.

At the meeting, Gov. Corbett made clear that he supports the report, wants to see its recommendations made into legislation, and wants that legislation on his desk by June 30. The JRI recommendations reflect the principles upon which our coalition has agreed and I couldn't agree more with Gov. Corbett's sense of urgency.

I also received the following comment this afternoon from Gov. Leader:

The release of the JRI report, with the support of stakeholders across our criminal justice system, demonstrates the importance of "real corrections reform, right now." In the business world, where I've been since my governorship, when we have problems, we get good information and use it quickly to solve them. My family and I hope the General Assembly will do the same here, and we applaud Gov. Corbett and Secretary Wetzel for their leadership.

Save Our Schools or Save Our Kids?

Commonwealth Foundation — Wed, 23 May 2012 14:30:00 EST

Throngs of anti-parental choice supporters have rallied in Philadelphia today, demanding more taxpayer dollars for their cause. According to Philadelphia Inquirer reporter Kristen Graham via her Twitter feed @newskag, protesters were loudly shouting "Save our schools," while waving signs that read, "Save our Schools: Stop Privatizing."

While it is nice to finally see and hear their honest priorities, we can't help but wonder who is going to be saving our kids from public schools like University City in Philadelphia where less than 5 percent of 11^th graders reached proficiency in reading and math. Should we be saving failing and violent schools or saving the kids forced to attend them?

Despite the lack of any evidence that proves more dollars make more scholars, these adults continue to demand more money to stop parents from choosing where their child goes to school. Please hear from one such Philadelphia parent, Lorenzo White, who says school choice is the only way out.

Why Families Like Cyber and Charter Schools

Commonwealth Foundation — Wed, 23 May 2012 11:30:00 EST

Nine-year-old Ashley Matunis and her sister, 6-year-old Anna (pictured right), are typical girls who enjoy pizza and pretzels. They are also typical of the kind of students who attend cyber schools. They go to Pennsylvania's largest such school, PA Cyber, which now educates more than 11,000 students across the state.

As the girls' mother Sarah Matunis notes, cyber school meets her daughters' needs in a way regular schools cannot: Third-grader Ashley is learning quicker than average in math, and is now freely learning at the 4th-grade level. Anna was diagnosed with Type I diabetes before she turned 5, so cyber school allows her to keep up with school at home while her mother keeps tabs on her health. "We finally feel like our tax dollars are being used well," she said.

The Matunis girls are just two of some 90,000 students in Pennsylvania in charter schools, which include cyber schools. And the waiting list is 30,000 strong. They and other charter school families gathered in Harrisburg yesterday for their annual day on the hill to remind legislators why school choice is so important: It gives families like the Matunis a chance at an education best-suited to how their children learn and function. Pennsylvania families want lawmakers to protect school choice, and provide more of it.

As for Ashley and Anna, school choice means they could be the next Hannah Tuffy, a Scranton native who is the first graduate of PA Cyber to be accepted to the prestigious U.S. Military Academy at West Point. Let's give more families the schooling options they need to succeed like Hannah.

Corrections Coalition, Dynamic Duo Dandy Says Patriot

Commonwealth Foundation — Tue, 22 May 2012 16:45:00 EST

Hats off to the Patriot-News Editorial Board for calling for an end to the status quo approach to criminal justice that has failed Pennsylvanians.

Today's editorial highlights the dynamic father-daughter duo of former Gov. George Leader, Pennsylvania's 38th Governor, and his daughter, Jane Janeczek. These two crossed party lines to form a coalition to restore commonsense to Pennsylvania's criminal justice system.

The Patriot-News had this to say about the coalition:

When groups as diverse as the conservative-leaning Commonwealth Foundation and the liberal-leaning American Civil Liberties Union are standing together calling for action, lawmakers would have to be deaf not to hear.

The Commonwealth Foundation is pleased to be a part of this important and timely group. Over the last 30 years, the state's prison population grew by 500 percent, drastically outpacing violent crime rates. As the prison population exploded, the state needed more prisons, staff and tax dollars. State corrections spending is now the third-largest department in the General Fund Budget.

The Patriot-News sums the problem up:

The "lock 'em up and throw away the key" mentality has not produced safer communities. Certainly the most egregious offenders will need to spend their life behind bars, but the vast majority - 90 percent - of offenders spend time behind bars and then re-enter society.

Our corrections system is not preparing people adequately for what happens after they are released. Human services, police, religious and other community groups are rightly asking: Can't we do better?

As this editorial board understands, the answer is yes. Other states such as Texas and New York have been able to significantly reduce both their crime rate and imprisonment rate, saving tax dollars while improving public safety.

Another promising group working to correct the state's corrections system is the Justice Reinvestment Initiative (JRI), a working group commissioned by Gov. Tom Corbett. JRI will release its formal recommendations tomorrow, stay tuned to learn how these reforms can provide meaningful changes.

For more, visit CommonwealthFoundation.org/Justice

Pennsylvania's Economy Struggles to Compete

Commonwealth Foundation — Tue, 22 May 2012 12:00:00 EST

In three separate studies on the state's economic competitiveness and business climates, Pennsylvania remains near the bottom of the pack.

The 2012 Alec-Laffer Economic Competitiveness Index, ranks states economic performance and outlook (1 being the best, 50 the worst). According to the index, the Keystone State ranks 40^th in economic outlook for 2012 thanks to several factors, including:

50^th in Top Marginal Corporate Income Tax Rate
32^nd in Top Marginal Personal Income Tax Rate
50^th in Levying Estate/Inheritance Tax
45^th in Remaining Tax Burden (additional taxes beyond those already ranked)
41^st in Recently Legislated Tax Changes

Another study by ChiefExecutive.net placed the Keystone State as the 43^rd best state for business—a four position drop since last year. CEOs found, "Pennsylvania...is regulation heavy even for very small 1-2 person businesses," this despite a "positive" ranking in the development trend indicator as a result of the natural gas boom.

The general business climate is one thing, but how is the outlook for small businesses? The Thumbtack.com/Kauffman Foundation Small Business Survey found that Pennsylvania's small business climate is mediocre, earning a C for overall friendliness to small businesses. Although the survey gave business start ups a C+, the commonwealth received a C- for hiring regulations, and a D in jobs training programs.

Pennsylvania remains a relatively unattractive place to begin or operate a business. Crippling taxes, heavy regulation, and burdensome bureaucracy have held back the Keystone State's economic growth.

How to Fix What's Broke in Education

Commonwealth Foundation — Tue, 22 May 2012 10:00:00 EST

Harrisburg Patriot-News columnist Nancy Eshelman rightly sounded the alarm Sunday on Pennsylvania's public education system:

It's the same old story. Every spring, threats of higher taxes, slashed programs or both hang over our heads like thick black clouds.

It's time to yell, "Enough!"

This isn't a midstate problem. Schools across Pennsylvania are slashing and burning programs while jacking up taxes. What we need is someone in power to step up and lead the charge to fundamentally change the way we do business. Our system is broken. We need a better one, one that doesn't rely on property taxes, one that treats education with the importance and respect it deserves.

Ms. Eshelman is correct when she points out that Pennsylvania's public education is broken. But there is a proven policy solution that allows teachers, schools and families to do more with less: School choice. Twenty states have passed education reform that includes opportunity scholarships, or vouchers, to low-income students, and scholarships through tax credits.

The results speak for themselves. After 20 years of trying school choice, our best studies show all or some voucher students improve academically through the policy. The best part? Nineteen of 20 studies show that competition through school choice improves public schools, too. By contrast, simply increasing funding for flagging school districts does not fix the entrenched problems driving persistent failure.

School choice is the new solution Pennsylvania needs to fix its broken education system. With school budgets strained and taxpayer dollars stretched, it's also the remedy that will help students, families, teachers—and our public schools.

Pennsylvania's Pension Iceberg

Commonwealth Foundation — Mon, 21 May 2012 13:30:00 EST

Laura Olson of the Pittsburgh Post-Gazette has a story on the crisis in Pennsylvania's public pensions, and Gov. Corbett injecting pension reform into the budget discussion:

Even with the revised payment plan approved in 2010, the state's obligation will increase dramatically in the coming years. The current budget accounts for $1.1 billion in pension payments, a cost that spikes to more than $4 billion annually by 2016.

"Does anybody here see the economy growing fast enough just to cover the pension increase?" Mr. Corbett asked during his Hershey appearance earlier this month. "So we have a problem. We have an iceberg right in front of us."

David Fillman of AFSCME blames the legislature for underfunding the plan: "'We knew this 10 years ago, we knew this was coming," Mr. Fillman said.

But Mr. Fillman's complaints about the underfunding of pensions seems to be inconsistent with the fact he and his group fully supported legislation to defer these same contributions. Examples of this are Act 40 of 2003 (which actually created the 2012 contribution plateau) and Act 120 of 2010 which established the pension "collars" and further underfunded PSERS and SERS.

In fact, while the Commonwealth Foundation was sounding the alarms about the "iceberg" facing Pennsylvania's pensions, Fillman was denying any threat from rising pension costs (emphasis added):

In short, the Commonwealth Foundation has cherry-picked data and predicted the "worst-case scenario" for every possible variable, twisting the data to further its agenda of attacking public service workers and gutting government. The Commonwealth and SERS are already tackling this issue: Pennsylvanians should rest assured that Pennsylvania is not the Titanic, and there are no icebergs in our pension fund's future.

What is even more troubling is that state employees are forced to fund AFSCME's lobbying effort against pension reform. AFSCME union dues are taken directly out of state workers' paychecks without them ever seeing the money, with taxpayers funding the collection of AFSCME's political dollars. This is how Fillman (who earned $206,000 in compensation in 2011) and AFSCME put the squeeze on Pennsylvanians.

Cal U Waste Begs for Higher Ed Reform

Commonwealth Foundation — Mon, 21 May 2012 10:50:00 EST

The Senate's budget included more funding for state universities than Governor Corbett proposed, but new discoveries of wasteful spending should give lawmakers pause.

Gov. Corbett proposed a 30 percent cut to state-related schools, such as Penn State, and a 20 percent cut to state-system schools such as Shippensburg and California University in his February budget proposal.

In exchange for a full restoration of funds, state schools agreed to hold tuition increases to inflation (3.2 percent). But this should be taken in context, considering tuition at Penn State and Pitt doubled over the past decade. The truth is, increasing or even maintaining higher ed subsidies will do little to address rising tuition.

As Senator Corman admitted:

I think the governor's made a good case over the last year or so that higher reimbursement from the state doesn't necessarily mean lower tuition, but we wanted to make sure it did.

So what is driving up tuition? Part of the answer is wasteful spending. The firing of long-time California University of Pennsylvania president Angelo Armenti Jr. highlights a culture of wasteful spending and irresponsible borrowing.

Under his leadership, the school built a 6,500 seat convocation center with the help of a $19.1 million grant from state taxpayers. Project mistakes and overruns ballooned the price tag to $59 million, and debt service on the project next year alone will total $2.5 million. The audit spurred by complaints also discovered the university spent $16,000 to purchase a new refrigerator and freezer for the President's home.

Stories like these have motivated Rep. Brad Roae to introduce a new package of bills aimed at prohibiting wasteful spending.

Roae's Keep Tuition Affordable Plan presents ten bills designed to reduce tuition and increase the efficiency of state-system schools. His plan includes:

A moratorium on non-emergency construction;
Requiring full-time professors to teach at least 15 credit hours;
Prohibiting a ban on cost-saving part-time professors;
Freezing PASSHE tuition next year;
Making student activity fees optional;
Ending free tuition for family members of employees; and
Redirecting state aid to student grants.

The final and most important bill would distribute subsidies to students rather than institutions, a more effective way of reducing college cost. Legislators need to restructure public university funding in order to create more value to university students, parents, and taxpayers.

Chart: School District Fund Balances Nearly Tripled in 14 Years

Commonwealth Foundation — Thu, 17 May 2012 13:30:00 EST

PA Independent reported on Monday that Pennsylvania school districts' fund balances reached $3.2 billion in 2011 (they compiled the data from the PA Department of Education's (PDE) school funding portal).

This represents a dramatic increase over recent years, with schools reserves almost tripling since 1997, and doubling in just the last 6 years, according to PDE data.

Taxpayers Screaming at PLCB Waste

Commonwealth Foundation — Thu, 17 May 2012 11:00:00 EST

Another day, another story of waste at the Pennsylvania Liquor Control Board. ABC 27's Dennis Owens reports on the PLCB buying extravagant wine, then selling it at a discount (and not charging taxes or the usual 30 percent markup).

In all, the PLCB spent just over $27,000 on eight bottles of Screaming Eagle Cabernet and sold them for just over $20,000 - a $7,000 dollar loss - which leaves critics with a bitter aftertaste. ...

The PLCB did not collect the usual markup. If those taxes and fees are factored in, the losses on those wines is closer to $22,613.

This is just the latest in a long train of abuses. Just in the last two weeks, stories have surfaced about the PLCB's Wine Shrine, the $2.5 million the monopoly seller of wine and spirits lost in broken or missing bottles, and the $100,000 the PLCB spent on an iPhone app.

If anyone is benefiting from the PLCB's monopoly, it is investigative reporters, who don't have to go too far to find another story of government wasting your tax dollars.

Visit FreeMyDrink.com to take action.

Who Should Need the Government's Permission to Work?

Commonwealth Foundation — Wed, 16 May 2012 15:52:00 EST

What's more dangerous, an incompetent barber or incompetent emergency medical worker? Most people would say and EMT, but a barber has to undergo almost nine times the hours of training as an EMT before they can get a license to practice in Pennsylvania.

The Institute for Justice this week released a new report looking at occupational licensing requirements across the 50 states for mid- and low-income jobs. They discovered dramatic occupational licensing inconsistencies that undermine the public safety argument used by licensing proponents. For instance, only three states license interior designers and only five states license shampooers.

In Pennsylvania, 44 of the 102 occupations surveyed required licenses, including manicurist and upholsterers. Overall, Pennsylvania's occupational licensing burden is lighter than many states—ranking 38th among the states in licensing burden on residents, due to relatively low fees and education requirements.

As we've pointed out before, these regulations are often not about protecting consumers, but preventing competitors to existing businesses. For those truly worried about ugly living rooms from unlicensed interior designers or a bad hairdo from an unlicensed hair braider, there are less costly ways to protect consumers.

Broken Bottle Booze Bonanza Baffles Bourbon Barons

Commonwealth Foundation — Tue, 15 May 2012 16:00:00 EST

Another day, another alliteration, another wasteful Pennsylvania Liquor Control Board practice uncovered by the media. This time, a hat tip to Ben Simmoneau of CBS 3 Philadelphia for his report uncorking a putrid potables policy whereby consumers can simply pour out contents, break a bottle, return it to the PLCB and they will replace it, no questions asked! You can't make this stuff up.

The bottom line for the Viceroys of Vine: They lost $2.5 million worth of wine and liquor: bottles broken, stolen or just plain missing. The year before, it was $3 million. And that was a year the whole system only made $52 million, according to the report.

But no worries, drinks are always on the house. And by house, I mean taxpayers, who will continue to bear the burden of government-sold booze until privatization finds its way. Until then, stay thirsty comrades.