Triple-Dippers, Solar Bankruptcies and No-Bid Contracts: State Roundup

By PA Independent Staff

HARRISBURG – It was a bit of an ugly week for taxpayer funds.

Despite some action from the state House, a loophole allowing retired state workers to collect a paycheck and unemployment benefits remains open for now.  Meanwhile, a solar energy firm in Pittsburgh that got $10 million from taxpayers is going bankrupt and a new no-bid contract means residents and business in Pennsylvania will be paying fees of $2 or more for some online government services.

Big dippers: Three scoops into state coffers for re-hired state workers on unemployment

The House of Representatives unanimously passed a bill to ban “triple-dipping,” or the practice of state retirees who come back to work temporarily and then receive unemployment benefits.

House Bill 421, sponsored by Rep. Adam Harris, R-Juniata, would prohibit unemployment eligibility for public- and private sector employees who leave a job to protect their pension benefits.

State law says retirees who come back to work cannot hold the position for more than 95 days or they lose their pension checks and health benefits.

But since the term of employment is predetermined, the state’s unemployment system considers the leave involuntary. That’s when employees becomes eligible for unemployment compensation, on top of their pension benefits and temporary salary.

It’s a legal loophole through which hundreds of people have jumped. In 2010 and 2011, more than 450 state retirees received a combined $2.1 million in unemployment compensation, according to House calculations.

Solar energy firm going bankrupt after $10 million federal subsidy

A Pittsburgh-area solar energy company that received more than $10 million as part of the federal stimulus is asking a federal judge to allow it to file bankruptcy.

Ten former employees at the Flabeg Solar U.S. Corp plant have petitioned a federal judge for severance pay after they lost their jobs last month as the plant was shut down. The 10 employees listed in the filing are seeking $197,000 in severance pay, according to court documents.

In 2009, when President Barack Obama announced a round of $2.3 billion in tax credits for 183 clean-energy projects in 43 states, including the $10 million for the Flabeg plant in Pittsburgh, he promised the investment would return 17,000 new jobs.

“Building a robust clean energy sector is how we will create the jobs of the future — jobs that pay well and can’t be outsourced,” Obama said in a statement at the time.

The $10 million awarded to Flabeg Solar was for the production of high-temperature solar mirrors to be used in solar energy power plants.

According to a report from the Pittsburgh Tribune-Review, the state and Allegheny County chipped in another $9 million to help get the plant off the ground.

Users will pay fees for sole-source services contract

Pennsylvania entered a sole source, no-cost contract with an online services company called NIC USA to take over operation of its online services.

NIC creates and maintains online services for more than 3,500 governmental bodies, including 28 other states.

The state pays NIC nothing out of its own budget. Instead, the site work gets funded by adding “convenience fees” to certain online transactions residents or businesses might complete, like a license renewal.

Dan Egan, spokesman for the Office of Administration, said the NIC contract was precipitated by multiple issues with the current system.

“No one company does everything that NIC does and can do in a way that isn’t going to cost us tens of millions of dollars,” Egan said.

State Rep. Robert Matzie, D-Beaver, expressed his concerns about NIC in a letter to Attorney General Kathleen Kane and Auditor General Eugene DePasquale. He protested the fact it was a sole source contract, meaning there was no competitive bid process.

“It shouldn’t have been done without an RFP (request for proposals) to see what other companies could’ve provided,” Matzie said.

Online voter registration legislation introduced

State Sen. Lloyd Smucker, R-Lancaster, sponsored a bill to create online voter registration in Pennsylvania.

“The idea is to give additional options and provide greater convenience, and hopefully increase participation in voting,” Smucker said.

Smucker said he got the idea from a constituent who wondered why Pennsylvania didn’t have an online system like those used in other states.

Residents would be able to register online up to 30 days before an election. They also would be able to change their party affiliation, address or name on the online form.

Smucker acknowledged that an online system does open the possibility for fraud. But to safeguard against false registrations, those who register online would be required to enter part of their Social Security number and another identification number, like a driver’s license.

Corbett continues negotiating over Medicaid

Gov. Tom Corbett is continuing to seek a special deal with the federal government to increase flexibility in how Pennsylvania will administer Medicaid under the new federal health care law.

Corbett met Tuesday with federal Secretary of Health and Human Services Kathleen Sebelius, who is in charge of Medicaid, the health insurance program for the poor that is funded jointly by the states and the federal government.  On Wednesday, the governor described the meeting as productive but said it lacked any sort of definitive agreement between the two sides, though he acknowledged he wasn’t expecting one.

“There are ongoing discussions that will continue to flow back and forth,” Corbett said.

Corbett declined to go into the details of the negotiations, but earlier on Wednesday his office issued a statement that implied Corbett was seeking a deal similar to what the federal government previously granted to Arkansas.

Under the provisions of that arrangement — struck by Democratic Gov. Mike Beebe — Arkansas would be able to use the private health insurance exchanges that are a part of the federal health care overhaul to cover Medicaid patients.

Conservative groups warned that such a deal would be a bad one for the state and pointed to a Congressional Budget Office report indicating Arkansas would be on the hook for $3,000 for each new Medicaid patient in the health exchanges. Democrats continue to urge Corbett to accept the full Medicaid expansion, which they say will provide coverage for 800,000 people and will be mostly paid for by the federal government.

March a slow month for tax collections

Revenue Secretary Dan Meuser reported that Pennsylvania collected $4.2 billion in revenue for March, about $69 million less than the state was expecting.

The three major types of taxes that fund Pennsylvania government – corporate, sales and personal income taxes – all came up short of expectations for the month.

Even with the slow month, tax collections for the year are slightly above the state’s target for the year.  Pennsylvania has brought in more than $20 billion from taxpayers since the fiscal year began on July 1, 2012.

PSP investigating attack videos against PA rep

The Philadelphia Inquirer’s Angela Columbis reported this week Pennsylvania State Police are investigating who is behind a pair of anonymously posted videos attacking state Rep. Tarah Toohil, R-Luzerne.

The House Republican caucus requested PSP look into who was behind the videos, Columbis reported. Investigators have questioned at least a half-dozen people, including lawmakers. More from the Inquirer:

On its face, the investigation is a high-tech whodunit as police work to trace the videos. Behind that lies a messy tale of Capitol politics and personality.

Toohil, 33, entered last fall’s campaign with reason to be confident. She had, after all, faced stiffer competition: In 2010, as an upstart tea party candidate little known outside her Luzerne County district, the young lawyer had toppled Todd Eachus, one of the House’s most powerful Democrats, helping her party gain a majority in the 203-member House and positioning her as a bright new face in Harrisburg.

Then, last Oct. 16, a video titled “Pizza Party” was posted on YouTube.

Set to music that sounded ripped from a 1980s music video, “Pizza Party” displayed photos of a younger Toohil – at a table with what looked to be marijuana and a bong; she was also seen leaning toward another young woman, as if to kiss her on the lips.

The other video attacking Toohil, released before Election Day 2012, featured an image of a Guy Fawkes mask and voice-over demanding Toohil change her stance on marijuana legalization.

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