HARRISBURG, Pa. (AP) — A Republican lawmaker’s proposed new approach to public pension reform is getting compliments from an unusual source — Pennsylvania’s largest teachers union.
Mike Crossey, president of the Pennsylvania State Education Association, said Monday that Rep. Glen Grell’s plan represents “an interesting new direction” in the debate over skyrocketing costs in the state’s two major public pension funds.
Crossey says past proposals requiring future employees to enroll in a 401(k)-style program amount to using a sledgehammer to fix the problem.
Grell proposes borrowing $9 billion to help make up for years of pension underfunding and creating a “cash balance” retirement plan for new employees that guarantees an annual return of at least 4 percent. He says savings over 30 years would offset most of an unfunded liability estimated at $41 billion.