Barry Shutt intends to display his new Pennsylvania pension debt clock in the East Wing Rotunda at the state capitol complex in Harrisburg, next to the cafeteria.
He hopes the exposure will prod lawmakers to deal with a pension-debt problem that has triggered the wrath of bond-rating agencies.
"If we display it where many people walk past it every day and see that this debt is rising by $143 per second, they'll realize how big a problem it is. We've got to do something," said Shutt, a retired state employee and pension overhaul activist. "The clock is portable, so if they kick me out, I can set it up elsewhere."
Pennsylvania, one of the lowest-rated states, has received five downgrades in the past five years, with rating agencies citing pension debt. Moody's Investors Service rates the commonwealth's general obligation bonds Aa3. Fitch Ratings and Standard & Poor's rate them AA-minus.
Shutt, who worked for the state's agriculture department for 20 years, plans to unveil his real-time electronic clock – made in Illinois and patterned after the national debt clock in New York's Times Square ¬– at 11 a.m. Wednesday at the rotunda.
Joining Shutt will be State Rep. John McGinnis, R-Altoona; Hummelstown, Pa., actuary Richard Dreyfuss; and another citizen advocate, Eric Epstein.
Dreyfuss, an adjunct fellow at the Manhattan Institute for Policy Research and a retired Hershey Foods executive, estimated the unfunded liability at $63 billion for the state's two major pension systems, the State Employees' Retirement System and the Public School Employees' Retirement System.
He said his estimate simply adds interest at 7.5% per year to the unfunded liability based upon the most recent publicly-available actuarial valuations, June 30, 2015, for PSERS and Dec. 31, 2014, for SERS. Using the systems of the Government Accounting Standards Board and Moody's, he also used the market value of assets in contrast to the actuarial value of assets.
Dreyfuss also based his estimate on the current 7.5% assumption for the annual return on assets.
Debate over solutions to the pension debt percolates as the state as mired in an eight-month impasse over Gov. Tom Wolf's proposed $30 billion budget for fiscal 2016. Wolf in late December approved three-fourths of that budget to free up funds for school districts and social service agencies while holding out for increased basic education aid.
Earlier this month he presented a $32 billion spending plan for fiscal 2017.
Shutt said the $143-per-second multiplies quickly. "If you have a 20-minute cup of coffee, that's $172,000. If you take a one-hour lunch, that adds up to another $515,000."
He opposes the issuance of pension obligation bonds – Wolf had proposed $3 billion of such borrowing in the fiscal 2016 budget. "It can't be done with a bond because we still owe the bond," he said.
McGinnis, a retired Pennsylvania State University professor and the author of the pension-related book, "Future Forsaken: Pennscam and the Demise of the Commonwealth," has a bill pending the legislature that would eliminate Pennsylvania's public pension debt over 20 years instead of 30 with level dollar funding, about $7 billion annually.
The bill is still sitting in committee.
While lawmakers are split over tax-and-revenue packages to plug a $2 billion state budget deficit, let alone the pension liability, Shutt said some younger legislators who otherwise oppose tax increases for new spending would favor them only if they pay down the pension debt.
