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Scarnati talks budget, Marcellus Shale, Santorum

April 30, 2012

State Sen. Joe Scarnati

PUNXSUTAWNEY — On the eve of lawmakers returning to Harrisburg to hash out details of Gov. Tom Corbett's proposed 2012-13 budget, state Sen.
Joe Scarnati said there's bright spots and not-so-bright spots.

"Revenues are improving, so that's a bright spot," Scarnati, who also serves as president pro tem in the state Senate, told The Spirit last Thursday.

A $700 million shortfall, however, is not a bright spot, he said, and neither is the slow pace of recovery.

"We are improving, but the numbers are slow," Scarnati said. "That's still not a lot of comfort to people. But the lights are getting a little brighter."

There are a number of factors — the housing issues, the price of gasoline — hampering recovery, he said.

As lawmakers pretend to tackle Corbett's proposed $27.1 billion spending plan, Scarnati said they need to wake up and see "the elephant in the room that’s sucking every dollar:" The State Employees' Retirement System (SERS), which he described as "a bubble about to burst."

"It's a delicate, delicate situation," he said. "With the state pensions, people don't want to talk about it. We're going to lose hundreds of millions of dollars into more pensions, or we have to talk about it, how to help."

He said Tom Ridge, who was governor when Scarnati was first elected to the 25th District in 2000, believed that the actuaries showed that the then-new SERS program could sustain itself.

"But what was created was not sustainable," Scarnati said. "This is about where to direct the money safely, and there's no better place to start than the state legislature.

"It's the elephant in the room, along with runaway spending in the state Department of Public Welfare," he said, noting that lawmakers must figure out how to direct and invent funding toward the community, such as schools, recreational opportunities and more.

"We need real statesmen, real leaders to step up and do it," Scarnati said.

Scarnati also spoke about these issues:
• He said all of Pennsylvania's 53 counties passed ordinances giving authority to municipalities and townships to pass resolutions which will allow them to receive impact money from Marcellus Shale gas extraction. Payments to those counties and municipalities should starting arriving in October.

Jefferson County has "pockets" of Marcellus activity, while areas such as Clearfield, Potter and Tioga counties, for example, are heavy.
Scarnati said those areas are on the "thick of the shale," while in Jefferson County, there are splintered shares, with "plenty of jobs," regardless.

He cited the case of Superior Hose & Fittings in Brockway — his hometown — that now employs 110 people. Instead of hauling in its needed equipment from elsewhere, the company is now manufacturing its supplies in the Brockway area.

There are still Marcellus-related needs such as hospitality and manufacturing, but companies "face the problem with getting skilled workers that can pass a drug test," he said.

In some cases, a company looking to hire employees may look at a field of 100 people, then narrow that down to 10, but fewer than five pass the drug test, Scarnati said.

He said he believes drug testing for such jobs is up to individual employers, but when dealing with multimillion dollar equipment, no one wants an impaired individual operating it.

About Pennsylvania's efforts to make Marcellus Shale drilling efficient and safe, Scarnati said, "There are still people distrustful of drilling, and the EPA and the DEP, but we've found a balance with protecting the environment."

• Speaking just over two weeks after former U.S. Sen. Rick Santorum's departure from the race for the Republican presidential nomination, Scarnati said he believed Santorum's biggest challenge was money, despite winning a few early primaries.

Despite Santorum's departure from the race, Scarnati called him "the new standard-bearer for conservatives."

Now that former Massachusetts Gov. Mitt Romney is emerging as the all-but-certain Republican presidential nominee, it's time to compare him not to the other challengers, but to President Barack Obama, Scarnati said.

"If you look at the failures of this (Obama) administration versus the success of a businessman like Mitt Romney, that's going to be the debate," he said.

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