Of Calendars and Porn Taxes

Policy Blog may only be #6 in this weeks PA Blog Influence Ranking, but we made some noise over the weekend. The Pittsburgh Tribune Review featured a story on the cost of calendars printed and distributed on behalf of lawmakers. The defense:

"The calendar is one of the many informational materials made available to constituents, such as the Pennsylvania Manual, road maps, other travel information, packets of educational material for school groups, and brochures describing various state programs," said Erik Arneson, a spokesman for Senate Republicans.

We obviously don't agree, and even though the calendars don't cost much relative to the overall state budget, they serve no purpose other than to market sitting lawmakers to voters (note the "Compliments of [Lawmaker]" that appears on each calendars, though taxpayers, not lawmakers foot the bill).

Arneson's arguments didn't persuade the Trib either, as they called for "Killing the Calendars" on Sunday. That seems to be the consensus of GrassrootsPA readers (except "INSIDER") as well. UPDATE: Calendar coverage also made in into John Micek's blog and Capitolwire's "Under the Dome" (subscription service or email signup).

In other news, Tony Phyrillas' doesn't like the idea of a porn tax either. Citing my arguments and adding some of his own, Phyrillas puns, "It's a slippery pole that Sen. Orie is sliding down".

More Taxpayer Money Wasted on Promotions and Marketing

I'm not sure if readers are aware of this, but Congress recently passed something called a "stimulus" bill a few weeks ago.  In order to publicize the stimulus funding, Governor Rendell spent $100,000 to hire an outside public-relations consultant.   (HT: Grassroots PA).

Surely, given the budget shortfall and hiring freeze, they hired the best person they could find for the lowest cost, through competitive bidding.  The Governor wouldn't just hire someone with numerous political ties from doing "public-relations and political-campaign work for high-profile public officials including Rendell, former Mayor John F. Street, and former State Sen. Vincent J. Fumo."  Oh, right.

On a related note, John Micek notes that House Democrats are producing - at taxpayer expense - clips for the radio meant to sound like authentic news stories.   This comes from the tens of millions of dollars the General Assembly has for self-promotion (including things like "public service announcements", glossy newsletter, calendar give-aways, and the like).   Sen. Mike Folmer has legislation that would require all such advertising to state "paid for at taxpayer expense."

Why Calendars Matter

The latest story of Capitol Calendars bought at taxpayer expenses is a Tribune-Review article on Catherine Baker Knoll (as president of the Senate) getting her share. Other recent stories appeared in the Patriot News, the Morning Call, and the Pottstown Mercury.

The most common defense of calendars is not "what a great public service" they are, but "they don't cost that much" or "what's the big deal" (see here for example). Here is why calendars matter:

1) These calendars serve no purpose other than self-promotion. When I get a free calendar or giveway from a business, it is clear they want to promote themselves or a product they are selling. Same thing with lawmakers. Calendars are no different than a campaign mailer, only paid for by taxpayers. They are indefensible as an expenditure of state government.

2) Calendars are just one example of the many excesses of lawmakers and government officials. More troubling than the cost is that no one - save one gadfly from Altoona - saw anything odd about taxpayer purchased calendards. But that is just the latest in a long line of revelations:

• First the pay raise was repealed and several lawmakers started paying back their "unvouchered expenses" once they realized voters didn't like violations of the constitution.
• Then came revelations about bonuses afforded to staffers, which may have been tied to campaign work (illegally), followed by pronouncements about ending that practice.
• Then came some minor restrictions on "Public Service Announcements", at least during campaign season.
• That was followed by discovery of political polling done at taxpayer expense for "internal caucus use", again followed by promises to end the practice.

And after calendars, there will be more (best bet: stories about the cost of taxpayer-provided studios and video equipment for lawmakers to produce their own TV shows), until lawmakers turn over a new leaf and start eliminated excesses before the media and public express outrage.

3) Small costs add up. Sure a few hundred thousand is small potatoes in a $27 billion budget, but these things add up. In fact, I decided to look over the budget and find all the small ticket items and see what they add up to (the calendars are actually an expense from a larger budget item, but the exercise should prove informative). There were 203 programs receiving less than $1 million, which cost taxpayers $73 Million. Jumping up to programs receiving $10 million or less (equil to less than $1 per person) there were 450 programs costing taxpayers over $1 billion. And at $60 million - remember that this is the annual cost of Governor Rendell's energy plan, which he bills as the cost of a cup of coffee per/month - I found 571 programs costing $3.9 billion.



It goes to show you, a million here and a million there, and suddenly your talking about real money.

Fluid races could make Pa.'s late primary important

Peter Jackson commentary on the potential "influence" of the PA primary in April. While there has been a push to move the primary up in the calendar so that Pennsylvania will have more "influence" in the nomination, it is quite possible (given that no candidate - especially on the GOP side - is likely to wrap up the nomination early) that Pennsylvania could be the deciding factor.

I am of that mind as well - though we'll see how things play out - and think that moving up the primary to weigh in earlier would be like the Supreme Court hearing cases before the lower courts to "have more influence".

I would add that while Jackson notes that there is "not much activity on the ground" here in PA, we are three months away; but there is also not much activity going on in any of the 22 states voting on Feb 5 - all the candidates are currently campaign in Michigan, South Carolina, or Florida (but only in one of the three). Wyoming already had their caucus - and no one campaigned there - and Nevada is also upcoming, with little campaign activity. I imagine that on Feb. 5, only California will get serious attention (NY being conceded to Clinton and Giuliani). In other words, if we want attention from candidates, having a primary by itself a full month after the previous primary might be the best option.

The Cost of Pennsylvania's Prevailing Wage Law

Apparently my recent commentary on Philadelphia’s prevailing wages has stirred the city’s union waters, so I am posting the data analysis to support the article’s statement:

…the labor costs for public sector construction jobs in Pennsylvania average 37 percent higher than what the private sector pays for the same work and 44 percent higher in Philadelphia. Given the average cost of labor, this adds a little over 20 percent to the cost of every taxpayer-funded construction project.

I analyzed prevailing wage data for 268 projects in calendar year 2007. One project from each quarter was chosen from each of Pennsylvania’s 67 counties to account for any difference in wages by region over the course of the year. Four worker classifications were selected due to their presence in each project’s prevailing wage report and their lack of class types: bricklayer, carpenter, electrician, and plumber. The prevailing wages (obtained from the PA Department of Labor and Industry) were then compared to the 2007 average hourly wage for each profession in the respective county.



Focusing on Philadelphia, I compared the average wages from four prevailing wage projects in 2007 to the average market wages for the same year, as depicted in the table below.


The 20% additional project cost was calculated using the average cost of labor as derived from a survey of union contractors (45% of total project cost).

Pension Pain

Cross Posted at Capitol Domes

The stock market's steep decline is a source of angst for all those whose retirement account balances have taken a nosedive.

The financial discomfort of private-sector workers is compounded by their having to bolster the pension funds (SERS and PSERS) from which retirement benefits are paid to state and public-school employees.

Whereas most private-sector employees are enrolled in a "defined contribution" (DC) pension plan -- the retirement benefit of which rises and falls with the stock market -- government employees participate in "defined benefit" (DB) plans that guarantee a formulaic retirement benefit based on years of employment and average salary.

The retirement benefits of state employees' DB plans are not affected by the Dow Jones. They are funded with employee and taxpayer contributions, which are invested in the stock market. But if the SERS and PSERS portfolios underperform, more tax revenue is simply collected to straighten out the balance sheet.

The SERS and PSERS funds are facing losses of 30-40 percent for the calendar year. In order for these funds to have enough money to pay out the promised retirement benefits for state workers, taxpayers will have to chip in a good bit more.

Well before the recent slide in the Dow, the Commonwealth Foundation reported on the forecasted financial problems for SERS and PSERS.

Rep. Scott Boyd has introduced legislation that would place new state hires into DC plans. It wouldn't impact current DB plan enrollees and beneficiaries, but it would make future taxpayer contributions to SERS and PSERS more affordable and predictable.

Moreover, DC plans provide a long-term retirement benefit comparable to DB plans -- even with market fluctuations -- while not being subject to the politics inherent in the current DB plan paradigm (i.e., state unions and retiree associations constantly lobbying for a higher multiplier in the formula).

It is time state government follow the cue of the private sector and transition from DB retirement plans to DC plans.

Calendar Update

Our first batch of Capitol Calendars for Property Tax Relief are now for sale on eBay.
(Click here for details).

The latest Democracy Rising newsletter features a letter from Tim Potts to Rep. McCall demanding to be taken off "your mailing list for future mailings that are unrelated to your constitutional duties".