RockTheCapital.org

RockTheCapital.org (RTC) announced that it has asked the Internal Revenue Service and the Pennsylvania Department of Revenue to investigate the state and federal tax implications of “unvouchered expenses.” While public pressure forced the repeal of the illegal raises last year, many lawmakers are refusing to return the money to the taxpayers and others have opted to repay it over time.

Eric Epstein, RockTheCapital.org’s coordinator stated, “We should not reward people for doing the wrong thing. The voluntary repayment system is not working and has created disincentives for legislators to pay the money back to the General Fund.”

At issue is how the Internal Revenue Service (IRS) and the Pennsylvania Department of Revenue (PDR) will define, account, assess, monitor and verify the additional income.

 

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Information Letter Request

Response from the Department of Revenue

Letter to Thomas D. Kimmet, Office of the Cheif Counsel, Department of Revenue

Letter to Marilyn Baker, Manager, Customer Account Services, Department of the Treasury

State House Minority Whip David Argall’s (R-Schuylkill & Berks Counties) expense records reveal that the incumbent is collecting an exorbitant amount of supplemental, tax-free income in the form of “per diems.” A thorough review of Rep. Argall’s expenses for the period 2005 through 2007 indicates he routinely collected the maximum per diem allowable even as he assumed his duties on the Speaker’s Commission on Legislative Reform.

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Download Argall’s Expense Report

RocktheCapital.org has prepared a Citizen's Guide to cutting $559,083,601.60 million from the Pennsylvania 2009-2010 fiscal year budget without impacting social services, education, health care or infrastructure.

1. Reduce non-lapsing, leadership accounts by 90%: Estimated annual savings of at least $217.35 million.
2. Allow the Department of Public Welfare to directly purchase prescription drugs for 1.2 million Pennsylvanians receiving medical assistance: Annual estimated savings of $146 million.
3. Eliminate film tax credit and marketing budget: Savings of $75.5 million.
4. Reduce legislative budget by 20% of $350 million: Estimated annual savings of $70 million.
5. Reduce DCED’s budget by amount appropriated to six legislative non-profits: Rebate of $29.6 million.
6. Eliminate tourism promotion WAMS: Estimated savings of $15.6 million.
7. Eliminate the Independent Regulatory Review Commission:
   Estimated annual savings of $2.1 million.
8. Eliminate Public Service Announcements:
   Estimated annual savings of $1.35 million.
9. Require health care contributions by the House of Representatives and their staff of 1% of their gross pay: The estimated annual savings - based on 203 representatives and 2,038 employees - is at least $1 million.
10. Ten percent cut in the salary of the 22 highest paid Penn State vice presidents: Estimated annual savings of $583,601.60.

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Ten Budget Cutting Proposals: 2008

$313,358,707.34

 

1. Liquidate non-lapsing, leadership accounts $241.5 million
2. Reduce legislature spending by 20%: $57.2 million annually.
3. Eliminate BIG: $10.6 million one-time refund.
4. Eliminate PSAs: $1.35 million in annual savings.
5. Reduce PHEAA funding by the amount spent on “lobbying fees:” $1 million.
6. Reduce judicial office space spending by 20%: Minimal annual savings: $684,000.
7. Reduce Penn State University’s annual allocation by the amount of Graham Spanier’s annual base salary: $611, 367.
8. Reduce Turnpike funding by amount spent on “lobbying fees.” Minimal annual savings: $312,000.
9. Refund from Senate members who continue to profit from "unvouchered expenses”: $67,340.34.
10. Rep. Mark Cohen’s refund for using tax payer dollars for his book buying sprees and New York weekends: $34,000.

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Twelve Alternative Budget Cutting Proposals

$300,290,839.54

 

1. Liquidate leadership accounts and refund FYI 2008 appropriations: $219 million + $60.5 million = $279.5 million
2. [Or reduce legislature spending by 20%: $57.2 million annually]
3. Eliminate BIG: $10.6 million one-time refund
4. Eliminate PSAs: $6.24 million in annual savings
5. Reduce PHEAA funding by the amount spent on Board perks and frivolous litigation costs: $1.215 million
6. Reduce PHEAA funding by the amount spent on “lobbying fees.” Minimal annual savings: $1 million
7. Reduce judicial office space spending by 20%: Minimal annual savings: $684,000
8. Reduce Penn State University’s annual allocation by the amount of Graham Spanier’s annual base salary: $545,016
9. Reduce Turnpike funding by amount spent on “lobbying fees.” Minimal annual savings: $312,00o
10. Eliminate John Estey’s part-time job working for the state: $147, 443.
11. Rep. Mark Cohen’s refund for using tax payer dollars for his book buying sprees and New York weekends: $34,000
12. Senator Mellow promised refund of the “unvouchered expenses” he kept: $13,380.54

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The coalition of organizations seeking to improve state government has endorsed the following priorities as a “Roadmap for Reform” in 2006. We expect to see these priorities enacted between now and Election Day.

 

Download the Roadmap for Reform

Download the Reform Coaltion Introduction

The Turnpike Commission is expending millions of toll dollars to underwrite its inefficient operations and perpetuate “pinstripe patronage.”  Starting a toll war will not lead to economic prosperity or fix a broken system. Don’t buy into the PTC’s latest marketing burp that “this is not your father’s turnpike.”

It’s time to extend the efforts to reform state government by eliminating the Turnpike Commission, and collapse and consolidate its functions into the Pennsylvania Department of Transportation.  A bill introduced by Sen. Jane Orie, (R-Allegheny County) in April, 2007 would do away with the Pennsylvania Turnpike Commission and assign turnpike operations, maintenance, and reconstruction responsibilities to the Pennsylvania DOT...
 

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PHEAA’s stated mission, and presumably its authorized reason for existence, “is to improve higher education opportunities for Pennsylvanians”. Are PHEAA’s expanding operations, focus and utilization of resources outside of Pennsylvania consistent with its published Mission Statement and do such activities meet the single objective of the Mission Statement?

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Mr. Michael Hershock, the former Chief Executive Officer (“CEO”) of the nonprofit Pennsylvania Higher Education (“PHEAA”) Foundation (“Foundation”), was fired on March 2, 2009. The dismissal came after Foundation board members became aware of Hershock’s travel expenses when they reviewed records the Patriot News requested.

Mr. Hershock was PHEAA's CEO from 1994 to 2002. PHEAA was set up in 1963 to make student loans more accessible to college students.

A special meeting was convened to discuss Mr. Hershock’s travel expenses. The Board voted unanimously to oust Mr. Hershock from his part-time post that paid $150,000 a year.

 

Read the rest of the complaint to the IRS  and the IRS response. (PDF)

The Pennsylvania Higher Education Assistance Agency was created in 1963 by state law with the intent of providing a public service to the Commonwealth. Its initial mission was to assist students in paying for college, thereby making higher education more accessible to Pennsylvania residents. In 1966 the legislature expanded PHEAA’s role and allowed the agency to administer student grant programs.

Education costs now resemble home mortgage payments. Middle- income and working class families are struggling to keep the dream of a college education alive.

To read more, download the PDF.