PRSRT STD

U.S. POSTAGE
PAID
HARRISBURG, PA
PERMIT NO. 529

Winter 2009

ves
epresentati
House of R OF PENNSYLVANIA
H
COMMONWEALT
HARRISBURG

king a
on ce ag ai n he re, thanks for ta the
or, liday season ew some of
Dear Neighb au ty an d th e bu syness of the ho nt of a ne w ye ar, I want to revi
gs! With the be closer to the ad ve
Season’s greetin rough my update. As we move r you. th at was the state budg a
et
to pa ge th ar ri sb ur g fo tr ai n w re ck
few minutes st year in H viously the end up with
ghlights of the pa l this year was ob fiscal year...all to for so long, I
lowlights and hi ating news story from the Capito ling for 102 days into the new ga continuing
The most domin anians endured political wrang us financial position. With the sa from the House Chamber
nnsylv
negotiations. Pe aves the Commonwealth in a pr
ecario total walk off any,
th at le bo th si de s of the aisle to plot a nal product was unpalatable to m
final budg et colleagues on ed, but the fi
ad a charge with fore that happen
was helping to le t. A budget w as co m pl et ed be
br in g
ions
further investigat ns
ou r di sg us s re po rt s
to signify t dismal. New re reform remai
including me. e, H ar ri sb ur g remains somewha on Pennsylvania-based health ca omy, even if it
dget passag eded work d state econ
Even after the bu w legislators and staff. Much-ne bama’s plan. And the national an .
of a fe ent O lutio ns
and indictments Congress tries to deal with Presid oblems that only have costly so g when those who choose to
th e U .S . en so m e pr ha pp en in to be
stalled as
ng tu rn ar ou nd , still brings burd ght? There are some good things ay be, the economy does appear
is in a cree pi n, ri it m nior-
s al w ay s da rk es t before the daw an ge . A dd iti on ally, sluggish as , my opportunity to achieve the se are
But it’ ly affect ch Personally more voices
das begin to slow e last few years. e that more and
lay personal agen r direction than it has been for th er than ever before. And I do se to “reform.”
heading in a heal
thie ai rm an is clos pa y ob lig atory lip service of the
y to be co m e a comm itt ee ch
H ar ri sb ur g runs....n ot ju st
I’ ve be en na med a co-chair
ity necess ar ho w
to really change opportunities have opened for
m e. ania’s
ch or us of ca lls I’ ve al so be en named Pennsylv
joining th e ersh ip ge 2). A nd
that two new lead ore on that on pa taxes.
I’m also pleased cus efforts in pension reform (m task force for streamlined sales re
azing
cently had an am ols
ep ub lic an C au e L eg is la to rs ’ e di st ri ct . W e
House R e of Stat dents of th in our scho
ational Conferenc e wonderful resi end a lot of time
delegate to the N energized by interacting with th erans Day commemoration. I sp m proud that, every day, my
I continue to be emorable Vet munity. And I’
lo ca l ve te rans for a very m set our educators are to our com ent red tape.
evening w ith as rnm ent you
ai n so th an kf ul for the incredible eve victory in battles with gove ilege that you allow me to repres most
and rem nts achi uing priv of the ut
t in helping reside I count it a contin tions on how my staff and I can be
staff is so diligen has its challenges, please know gg es
Though this job mments and su r!
L eg is la tu re . I welcome your co Christmas and a joyous New Yea
nn sy lv an ia w on de rf ul
in the Pe s have a
ay you and your
service to you. M

Respectfully,

Scott W. Boyd e, 43rd Legislativ

e District
e R ep re se nt at iv
Stat
 Pennsylvania Faces Looming Pension Crisis
In just a few short years, it is estimated
that as much as $5.9 billion will be needed
to cover the unfunded pension liabilities
of the Pennsylvania School Employees
Retirement System (PSERS) and the State
Employees Retirement System (SERS),
potentially translating into higher taxes
for Pennsylvanians in order to cover the
payout to retirees.
This pension crisis is expected to hit in
2012, and reach a historical high employer
contribution rate of 33.71 percent of pay
roll by 2015, due in part because it is a
defined “benefit” pension plan offered for
both public school and state employees.
A defined benefit pension plan means
school districts and the state are contractu-
ally bound to pay a certain amount every
month to school and state retirees. This
differs from many other defined “contri-
bution” pensions, such as a 401(k), in the
private sector.
The defined benefit pension plan is
funded through employer contributions
(i.e. public school districts and/or the state),
employee contributions and investments,
with investment earnings being the primary
source of funding for benefits. In fact, ac-
cording to PSERS, from 2000-09 invest-
ment earnings accounted for 59 percent
of funding, while member contributions
accounted for 26 percent and employer
contributions accounted for 15 percent.
However, like many investment funds,
the recession has greatly reduced the value
of investments in both PSERS and SERS.
Stock market downturns, inconsistent
employer contribution levels and changes
to the pension system benefit structure in
2002 have led to predicted double-digit
percentage increases in the employer con-
tribution rate in 2012.
It may seem that the simplest way to
avoid such pension spikes is to reduce or
withhold pension payments. However, the
state Supreme Court has ruled three times
in the last 20 years that the government
cannot legally alter or terminate pension
benefits. We are contractually bound to
make these payments to all current retirees
and employees.
PSERS employer contribution rate has
been 4.78 percent for about 12 years. It
currently predicts the employer contribu-
tion rate will nearly double by 2011, triple
to more than 20 percent in 2012, and
higher than that in future fiscal years. The
rate will not begin to plateau until the year
2024 at around 27.16 percent. This means
taxpayers will have to kick in potentially
hundreds of millions of dollars to make
PSERS fund solvent.
Solutions to this problem are difficult.
We could use education stimulus dollars
or gaming revenue to chip away at pen-
sion costs. Another solution is the possible
issuance of state bonds to pay off the
unfunded liabilities.
Of course, we also need to look at
changes in future pension benefits paid by
PSERS and SERS through the conversion
to a defined contribution pension for all
new employees in order to avoid such a
crisis from repeating itself in the future.
Even before I was selected as co-chair-
man of the House Republican Policy Com-
mittee’s Government Reform Task Force,
I have sought to address this very issue.
Two years ago, I introduced legislation to
lessen the blow of the 2012 pension spike
and have been disappointed at the lack of
action on my bill. I have introduced the
measure once again this legislative session
and am hopeful for forward momentum
and public debate on the issue. House
Bill 1174 would specifically move all new
Pennsylvania public employees from the
defined benefit pension plan to a defined
contribution plan, similar to a 401(k) or
403(b) plan. This pension system would
be provided for all public employees hired
on or after adoption of the legislation.
Unfortunately, this is a situation that
has the potential of affecting every tax-
payer in the state. I am working with my
colleagues in the General Assembly to
mitigate the impact on taxpayers as much
as possible while also correcting a system
that has proven problematic for the state.
I will continue to keep you updated as
this situation progresses and more solu-
tions are forthcoming.

You’re Eggs & Issues Breakfasts Please join me for breakfast and an update on
Invited!  Saturday, January 23
what’s happening in the Pennsylvania Legislature.
Several breakfasts will be held in various com-
Leola Restaurant munities through the legislative district. The meal
 Saturday, February 20
is free of charge, but residents are asked to RSVP
Willow Valley’s Robert Fulton Room
as to which breakfast they would like to attend.
 Saturday, March 13
Akron Restaurant Please make your reservations by contacting
 Saturday, April 10 the district office at (717) 464-5285 or logging on
Willow Valley’s Statesman Room to my Web site at RepBoyd.com.

I have been investigating alternative To accomplish this goal, I am offering

Saving Taxpayer
ways to communicate with you that are in- you the option of receiving future newsletter
formative, environmentally conscious and from my office in an online format. If you’d

Dollars with
cost effective. You are currently receiving like to make this switch, please take a mo-
my printed newsletters through the mail, ment and log onto my Web site at RepBoyd.

Electronic
and although constituents tell me they are com and click the “Have Your Newsletter
worthwhile, they are costly to mail. Using Delivered Online” icon. A simple form will

Newsletters
improved technology, electronic commu- be there for you to complete.
nication is an effective tool to keep you If you’d like to continue receiving this

www.
informed. Via e-mail and the Web, I am newsletter in print, you don’t have to do
able to communicate with you at a much anything. We’ll keep you on the mailing
reduced cost. list.
 2009-10 State Budget Wrap Up
The state budget was finally adopted
in October, more than 100 days after the
June 30 deadline. Most Pennsylvanians,
including myself, were relieved to see
the stalemate come to an end, but I am
concerned that the resulting budget was
not a good one for Pennsylvania.
In the face of a $3.2 billion deficit and
continued declines in state revenue, the
level of spending in this budget is just
too high. While House Republicans and
conservative Democrats were able to put
a stop to the governor’s proposed Personal
Income Tax hike for now, I am concerned
new taxes may be necessary in the next
year or two because sufficient cuts were
not made in this budget.
Here’s a general overview of the final
plan:
Tax Hikes
The budget includes a 25-cent-per-
pack increase in the state tax on cigarettes
and creates a new tax on “little cigars”
at $1.60 per pack. The state spending
plan also calls for a $374 million tax on
Pennsylvania employers at a time when
the Commonwealth’s workers and job
creators are reeling from the recession.
It does not include an increase in the
Personal Income Tax or in the Sales and
Use Tax. It also doesn’t include a sever-
ance tax on natural gas harvested in our
Commonwealth. The governor has said he
will pursue such a tax in the future.
Draining the Reserve Accounts
Budget negotiators balanced the state
spending plan, in part, by draining several
reserve accounts. The Commonwealth
had built up a $755 million Rainy Day
Fund that is intended to help in the event
of unanticipated expenses or economic
downturn. Using all that money this year
could come back to haunt us next year of
state revenues don’t improve in the next
few months (so far in the 2009-10 budget
year, revenues are more than $217 million
below estimates).
The budget also calls for depleting
the $708 million Health Care Provider
Retention Account and taking $100 mil-
lion from the MCare Fund. Both of these
funds are designed to help defray the cost
of medical malpractice insurance, as those
skyrocketing costs have prompted many
doctors and specialists to retire early or
take their practices to other states.
Furthermore, $150 million would be
taken from the Tobacco Settlement fund,
which receives money from a federal
lawsuit and allocates those funds for to-
bacco prevention and statewide health
care programs.
Draining the state’s reserve accounts
leaves nothing to fall back on next year.
Federal Stimulus Dollars
After being sworn into office, President
Barack Obama and Congress acted swiftly
to approve several bailout measures. One
of those was the American Recovery and
Reinvestment Act (ARRA), which, among
other things, provided federal dollars to
subsidize state budgets.
The Pennsylvania state budget includes
more than $2.6 billion in federal stimulus
money. Added to the nearly $25.2 billion
in state tax dollars and $1.7 billion from
the reserve accounts, the Commonwealth
will actually spend for the 2009-10 fiscal
year more than $27.8 billion.
Due in part to the extensive use of fed-
eral dollars for education, school districts
across the state received significant in-
creases in funding within the state budget.
Although I am an advocate for education,
this level of spending cannot be main-
tained once the federal money runs out in
a couple of years, which means taxpayers
will have to make up the difference.
House Republican Plan
House Republicans presented several
options through the budget process, in-
cluding the most comprehensive plan cre-
ated with the input of several key House
Democrats (House Bill 1943). Only partial
withdrawals from the reserve accounts
and none of these new and increased
taxes would have been necessary under
the House Republican budget proposal,
which was never brought before the Gen-
eral Assembly for consideration by the
Democrat-controlled House.
2010-11 Budget Process
We will be working on the 2010-11
budget in less than two months, and it
is essential that we avoid a repeat of the
2009-10 fiscal distaster and get a state bud-
get passed on time. There are several legis-
lative proposals currently being circulated
that might help expedite the process and
put measures in place to hold the General
Assembly more accountable. Hopefully,
those initiatives will be coming before the
House and Senate in the next few months.
Rest assured I will do all within my power
to get it done on time.
 Around the 43rd
One of the most enjoyable aspects of serving as your state representative is
the opportunity to interact with such a wide cross-section of folks in the district.
Throughout the year, it’s a privilege to participate in special events that welcome
our seniors, promote a healthy business environment, and that assist our
educators and our students.

Rep. Boyd holds elementary students in rapt attention while

he read Dr. Seuss during Read Across America week. Boyd
read at several schools throughout the 43rd Legislative District.
Pictured here are primary students at Lancaster Mennonite
School - New Danville Campus.

Rep. Boyd’s team in the 2009 Home Run Derby sponsored by the PA
Breast Cancer Coalition joined with a team sponsored by Rep. Eugene
DePasquale (D-York) for a Lancaster vs. York “Take a Swing Against
Breast Cancer” event. Boyd’s team won the contest at both the Lancaster
and York stadiums and set a record in the York contest. On the field at
Clipper Stadium in Lancaster are (from left) Mark Shoenfelt (owner
of B2B Baseball), Zack Shenk, Pete Gleason, Rep. DePasquale, Rep.
Boyd, Matt Turman, Mark Stuckey, and Frank Pinto, president of the
Pennsylvania Association of Community Bankers.

Rep. Boyd and retired State Sen. Noah Wenger (second

from left) were honored with a new plaque at the Lancaster
Farmland Trust’s Strasburg office. Looking on are Farmland
Trust volunteers and staff.

Rep. Boyd leads a Capitol event to honor Blue Star Mothers in

Pennsylvania. (Blue Star Mothers are mothers of children serving in the
U.S. Armed Forces.) Boyd welcomed West Lampeter Township resident
Mindy Rottmund (red sweater, back row) and other members of the
organization for the event. On the day of the event, House Resolution
248, sponsored by Boyd, received unanimous passage in the House to
honor name May as Blue Star Mothers month in Pennsylvania. Rep. Boyd joins three local veterans who participated in his recent “In
Their Words” Veterans Day event. From left are Thomas McInnes, Bob
Hershock, Rep. Boyd and Harry Ross.

State Representative Scott W. Boyd

West Lampeter Twp. Municipal Bldg., 852 Village Road, P.O. Box 268, Lampeter, PA 17537
Phone: (717) 464-5285 Hours: Mon.-Fri. 8 a.m. – 5 p.m. (Evening and Saturday hours by appointment)

432 Irvis Office Building, PO Box 202043, Harrisburg, PA 17120-2043

Phone: (717) 783-6422 Hours: Mon.-Fri. 9:00 a.m. - 4:30 p.m.

More news online at RepBoyd.com