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Senator Wayne D. Fontana


Pension Reform of 2010

CapitolGovernor Corbett recently vetoed a part of the 2014-15 budget connecting his actions to the Legislature’s lack of movement on pension reform.  However, if one would take a better look at Act 120 of 2010, they would see that the Legislature has already taken steps to preventing a major financial crisis, and we need to allow this act to play out before the Legislature continues to take further action on a crisis that may already have been averted.

In 2010, the General Assembly and Governor faced rapidly rising employer pension contribution rates, known as “rate spikes,” due to underfunding by state government and local school districts as a result of political decisions made nearly a decade ago under a republican administration.  In addition, investment returns had failed to meet expectations as a result of one of the stock market’s most volatile periods in recorded history.  For these reasons, employer contribution rates were slated to begin climbing and then jump sharply to nearly 30 percent, by 2012-13 for the Pennsylvania State Employees’ Retirement System (SERS), and for the Pennsylvania Public School Employees’ Retirement System (PSERS) by 2015-16.  Because of the benefit increases, underfunding and investment losses, the unfunded liability would soon grow to $47 billion.

As a response to the pending employer contribution, the Legislature passed, in an overwhelmingly bi-partisan manner, Act 120 of 2010 that was designed to provide some critical relief to undo some of the fiscal irresponsibility of prior decisions made.  In other words, Act 120 established a predictable plan with moderate increases in employer funding through a series of small steps over several years, rather than all at once when the rate spikes would begin by 2012.

Specifically, the benefit changes affect only individuals who became SERS members on/after January 1, 2011, and PSERS members on/after July 1, 2011:  

  • Reduced pension benefits for new employees by over 20 percent;
  • Increased the retirement age to 65 for new employees;
  • Reduced monthly payment multiplier for retirees by changing the underlying formula
  • Created a “shared risk” provision for new employees that increases employee contributions if actual investment returns fall below assumed returns
  • Vesting was changed from 5 years to 10
  • Eliminated the lump-sum withdrawal of an individual’s contributions at retirement

The law also established a plan for increasing employer contributions to gradually restore the state and school pension plans to full funding while at the same time actually lowering the cost to the state’s and schools’ pension systems.  This was achieved by putting in place “rate collars” that capped the growth of employer contributions to 3 percent in FY 2011-12 and increasing to 4.5 percent thereafter until no longer needed.

During the most recent budget negotiations, the Pennsylvania Senate took pension reform a step further by unanimously passing legislation that would enroll all elected officials in a 401(k) style retirement plan that will save the state nearly $700 million over the next 40 years.  Although this is not a significant reduction when you put it into context of how many years it would take to achieve this savings, it is another step forward that we have taken to decrease Pennsylvania’s debt.

Please keep in mind that state employees, which includes state troopers, corrections officers and state veterans home employees among many others, along with public school teachers did not create this situation and should not be punished for administrative inefficiencies.  There are over 250,000 Pennsylvanians who depend on the state’s defined benefit pension system and have paid their fair share over the past decade through their employee contribution. We owe it to all taxpayers to allow Act 120 to play out before we erase the progress we have recently made.

Did You Know…

Did you know the benefit cut to new employees as a result of Act 120 of 2010 is estimated to generate $33.1 billion in savings to the Commonwealth by 2043-44?

10th Annual FontanaFest

Fontanafest FontanaFest The 10th Annual FontanaFest is rapidly approaching!  This year’s event is changing venues and will be held at Highmark Stadium at Station Square, home of the Pittsburgh Riverhounds, on Saturday, August 9th from 11 a.m. – 3 p.m.

Members of the Riverhounds will be present and children in attendance will have the opportunity to participate in soccer activities on the field with them from noon – 1:30 p.m.  Other activities include inflatables, balloon making and crafts, along with the chance for children and families to receive important information on exercise, nutrition, healthy lifestyles, health care, education and jobs and job training.

Lunch will be provided from noon – 2 p.m. for all guests and once again IT’S ALL FREE!  Station Square will be providing free parking in the Stadium’s West Lot for attendees from 10:30 a.m. – 3:30 p.m.

FontanaFest is a 501(c)(3) and would not be possible without the tremendous support of our sponsors.  I want to thank the following organizations for their contributions to the 10th Annual FontanaFest:

Pittsburgh Riverhounds

Station Square

I.B.E.W. Local 5


Laborers' District Council of Western PA

Steamfitters Local 449

Point Park University

Peoples Natural Gas

Pittsburgh Plumbers Local 27

Pennsylvania Beverage Association

Eat'n Park Restaurants

Frank B. Fuhrer Wholesale

Flu/Pneumonia Shots & Senior Clinic – SAVE THE DATE

Flu ShotI am hosting my annual Flu/Pneumonia Shot & Senior Clinic on Tuesday, September 30th from 11 a.m. – 2 p.m. in Quinn Hall at the Church of the Resurrection in Brookline.  American HealthCare Group will be providing the free vaccinations to any senior with the Medicare Part B health insurance card.  Make sure to bring your card with you.

There will also be several organizations from around the region in attendance, providing seniors with important information on available services and resources.  I will continue to update you with additional information on the Flu/Pneumonia Shot & Senior Clinic moving forward, but please save the date – Tuesday, September 30th!

New Regulations for Electric Suppliers

PUCThe Pennsylvania Public Utility Commission (PUC) released a consumer alert last week regarding new regulations for electric suppliers. As of July 14th, new regulations have taken effect to enhance information in electric generation suppliers’ (EGS’) contracts and to ensure shopping customers are notified properly as their contract ends or terms change. The regulations require suppliers to now: display key contractual terms and conditions more prominently, especially for customers on variable rates; include an EGS Contract Summary with each contract; provide historical pricing data for customers on variable rates; and prominently mark customer notices of contract expiration or changes in terms.  For more information on consumer rights and protections, please visit

Table Games Revenue Increases

GamingLast week, the Pennsylvania Gaming Control Board released its monthly table games revenue report for the 12 Commonwealth casinos.  Table games revenue for the 2013-14 Fiscal Year increased 2.6 percent over the 2012-13 Fiscal Year.  Total gross table game revenue this year was nearly $732 million and total tax revenue came in at $105 million.  Table games are taxed at 14 percent, with the majority of that revenue directed into the state’s General Fund and the remaining funds directed to local governments.

Gross revenue from slot machines totaled over $2.3 billion during the 2013-14 Fiscal Year and tax revenue from slot machines totaled over $1.2 billion.  Slot machines are taxed at 55 percent and the revenue is directed as follows:  34 percent for property tax reduction; 12 percent supporting the horse racing industry; five percent is placed in a state economic development fund; and four percent goes to local governments that host casinos.

 To view the Gaming Control Board’s Monthly Report, please visit

Cinema in the Park

CinemaThe City of Pittsburgh Citiparks is once again hosting Cinema in the Park this summer at seven parks around the city of Pittsburgh.  Movies begin at dusk on their scheduled dates.  To view a listing of scheduled movies and the dates and locations, please click here.  Movies will be shown through the end of August at the following parks:  Arsenal Park in Lawrenceville; Brookline Memorial Park; Flagstaff Hill in Schenley Park; Grandview Park in Mt. Washington; Highland Park; Riverview Park; and West End/Elliott Overlook.

Play Well Allegheny Basketball Camps

PlayWellAllegheny County is hosting a series of basketball camps this summer for boys and girls at North Park, Boyce Park and South Park.  The camps are open to kids ages 10 – 15 and are designed to teach fundamentals, improve skills, run through drills, and have fun with local coaches and players with experience in the NBA, NCAA and W.P.I.A.L.

The North Park sessions are scheduled for August 4 – 6, Boyce Park for August 7 – 9, and South Park for August 11 – 13.  Camps meet daily from 10 a.m. – 3 p.m. on outdoor courts with a lunch break at noon.  Campers should bring their own lunch.  For more information on cost and registration please call 412-350-2455 or email

Sports LogoMayor’s Cup

The Brookline and Elliott girls’ under 12 softball teams reached the BIG League Sports Slow Pitch championship game, which was played on July 12th at PNC Park.  Brookline defeated Elliot in the title game and was awarded the Mayor’s Cup, which is awarded to the winning team.  Congratulations to both teams on great seasons! 

Fontana Fact

Since its founding in 1758, the city of Pittsburgh has always ended with an “h” in its spelling, with the exception of a 21-year period from 1890 – 1911.  During a time when many states had several towns and cities with the same name, President Benjamin Harrison created the United States Board on Geographic Names to develop a process in the naming of cities and towns throughout the country.  The Board decided to standardize all place names that ended with “burgh” and ordered that the “h” be dropped.  Following this decision, a 20-plus year campaign by the city’s residents demanded the Board restore the “h” in the name Pittsburgh.  In July of 1911 the Board, in a letter to U.S. Senator George T. Oliver, announced the restoration of the “h” in the name “Pittsburgh.”  A copy of that letter was re-printed in the Pittsburgh Gazette on this day in 1911.

Offices of State Senator Wayne D. Fontana

  Brookline District
932 Brookline Blvd.
Pittsburgh, PA 15226
Phone: 412-344-2551
Fax: 412-344-3400
543 Main Capitol
Box 203042
Harrisburg, PA 17120
Phone: 717-787-5300
Fax: 717-772-5484
Kennedy Township
Kenmawr Plz.
524 Pine Hollow Rd
Kennedy Twp, PA 15136
Phone: 412-331-1208
Fax: 412-331-2079
Beechview Satellite
1660 Broadway Ave.
Pittsburgh, PA 15216
Phone: 412-343-2080
Fax: 412-343-2418
Utilities Gaming Cinema