Monday, August 7, 2017

Pennsylvania in focus: Don’t make rate-payers clean up Harrisburg’s mess

By Watchdog News - August 07, 2017 at 07:55AM

The Patriot News opinion: Don’t make rate-payers clean up Harrisburg’s mess

Pennsylvania’s natural gas and electric utilities recognize the difficult choices facing lawmakers as they struggle to balance the state budget. In developing solutions, care should be taken to spread the burden of paying for state government fairly among citizens.

Tax legislation recently approved by the Pennsylvania Senate does not accomplish that goal.

Two-thirds of the additional revenue under that bill (over $400 million) comes from taxes on public utilities, including a new tax on the gross receipts of natural gas utilities and an increase in the current gross receipts tax on electric utilities.

Since regulated utilities have a right to recover their state tax payments, these new taxes are – in substance if not in form – taxes on utility customers.

Using utilities as collection agents for state government isn’t good policy.

First, it lacks transparency as costs of state government are presented to citizens on their utility bills rather than their tax bills.

ABC 27: Lawmakers move to protect own funds during budget stalemates

A bill that passed the Pennsylvania Senate comfortably late last month is designed to give lawmakers the explicit power to borrow money to pay their salaries, benefits and other costs during a state budget standoff.

The proposal, now pending in the House, would give them authority do the sort of borrowing that occurred during a lengthy budget stalemate with Democratic Gov. Tom Wolf in 2015.

The borrowed money would be deposited with the Treasury Department, which would then use it to pay the Legislature’s bills.

A Treasury Department lawyer says in a recent memo that his agency is obligated to pay salaries, benefits and core functions for the General Assembly and court system.

The Morning Call: Who says crime doesn’t pay? The Pennsylvania Supreme Court

Lackawanna County businessman Robert J. Kearns went community to community across Pennsylvania selling a plan that he and a partner said would save local governments big bucks on their electricity bills.

It was nothing more than a scam, prosecutors in four counties said, in which Kearns and a co-defendant enriched themselves at the expense of taxpayers, giving themselves big bonuses while the streetlight work they’d promised went nowhere.

Kearns is now a convict and is serving a six- to 12-month prison sentence in Northampton County, where he was found guilty of bilking $832,000 from Bethlehem Township. He surrendered in May after years of appeals, but his legal battles have only shifted to a different front — one that gives new meaning to the adage that crime doesn’t pay.

Ordered to make restitution to Bethlehem Township, Kearns says he shouldn’t have to pay back the money he stole.

And a recent ruling by the state Supreme Court may back his position, though it flies in the face of age-old wisdom: that if you steal, not only will you get in trouble, but you’ll have to make your victim whole.

In Pennsylvania, that bedrock principle has been called into question by the courts — especially for those who stole from the government.

At issue is the wording of the state’s restitution law, through which Kearns and countless others have been ordered by judges to make up for the losses their victims suffered. But under the Supreme Court decision, just who can legally be considered a victim is narrower than many judges, prosecutors and defense attorneys assumed.

The groundbreaking case involved Mike Veon, a former Democratic Party power broker and Beaver County state representative who served five years in prison after being convicted of public corruption in Harrisburg’s Bonusgate scandal.