Pension bill opposition threatens to derail state budget

HARRISBURG, Pa. -- Pennsylvania's state budget impasse ran aground in sight of land Wednesday over opposition in the state House to public-sector pension changes and a lingering dispute over new taxes.

Negotiators working feverishly to end the 6-month stalemate before Christmas said the pension changes, a Senate-placed condition on raising taxes, did not seem to be able to pass the House.

"We have been very firm that there will be no new revenue unless there is a pension bill sent to the governor and signed," Senate President Joe Scarnati, R-Jefferson, told reporters after meeting with House GOP leaders. "We have not seen that."

Democrats and moderate Republicans narrowly sent a $30.8 billion spending bill supported by Democratic Gov. Tom Wolf over key procedural hurdles in the House Tuesday, and there was widespread talk that Wolf could soon get the budget bill, taxes, pensions and related legislation.

But the pension bill has been a challenge, and when it went up for a vote in the House last weekend it was voted down overwhelmingly. It would alter the retirement benefits for newly hired teachers and state workers, and make other changes affecting current employees.

House Majority Leader Dave Reed, R-Indiana, said his chamber was going out of session and could be called back on six hours' notice. He said the House would not vote on the main budget bill without a specific proposal about the higher taxes needed to fund it.