State House Sound Bites

Capitol reporter Katie Meyer covers Pennsylvania politics and issues at the Pennsylvania state capitol.

Treasury candidates push transparency, promise to root out corruption

Written by Katie Meyer, Capitol Bureau Chief | Nov 2, 2016 1:23 PM
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The major candidates for treasurer, Democrat Joe Torsella, left, and Republican Otto Voit, right. (Photos by AP and via voitforpatreasurer.com)

(Harrisburg) -- Pennsylvania's seen some big spending in its political races this election cycle.

Its US Senate race is the most expensive in the country, out-of-state money has poured into its Attorney General race, and millions have been sunk into presidential ads around the commonwealth.

But there's only one contest where the amount of money involved is in the hundred billions: state Treasurer.

The winner of that office will manage all of Pennsylvania's assets and investments, contend with the commonwealth's debts, and inherit an office marked by corruption.

In comparison with the candidates in Pennsylvania's higher-profile races, though, the contenders for Treasurer haven't done a ton of campaigning for themselves.

Instead, many of the higher-profile appearances by Democrat Joe Torsella and Republican Otto Voit have been on behalf of other candidates--namely Donald Trump and Hillary Clinton.

Voit has become a fixture at Trump's Pennsylvania events, and was actually the first statewide candidate to formally endorse the businessman.

His speeches at the rallies tend to mirror Trump's own: he frequently calls for a change to the "status quo," and advocates that Clinton be jailed.

Torsella has also spoken at several Clinton events. He's come out as strongly anti-Trump, imploring the crowd at one rally to "make sure that the closest Donald Trump ever gets to the Oval Office is the line for tickets to the White House tour."

But apart from being loyal to their parties' respective nominees, who are Voit and Torsella?

Despite extremely different backgrounds, both are billing themselves as being government outsiders.

Torsella has never held an elected position. He acted as deputy mayor of Philadelphia under Ed Rendell, served as a US Representative to the United Nations, and had two separate stints as President and CEO of the National Constitution Center.

He puts heavy emphasis on his plans to hold the state accountable for its spending.

"Treasurer is an independent fiscal watchdog," he said. "I intend to use that function and to beef it up, and I believe through doing that we can find many more efficiencies in the state government."

Much like the presidential candidate he supports, Voit has a more business-centric background.

He's notably been the president of the manufacturing and distribution company Keystone Dental Group for nearly two decades. He is also a veteran of the Persian Gulf War, and served on his local school board.

He's promoting one plan, which he's dubbed his "PA checkbook-dot-com initiative," that he says would "show everybody all across Pennsylvania in easy-to use terms, where all our revenue is coming from [and where] all our expenses are going."

Whichever man is elected will be taking over an office that's seen more than its share of controversy in recent years. Two of the last three treasurers have been federally prosecuted.

Barbara Hafer, who served from the late 1990s to early 2000s, is facing charges that date back to business ties she maintained during her Treasury tenure. The last elected Treasurer, Rob McCord, resigned early last year and ultimately pled guilty in federal court to attempted extortion.

Promises to root corruption out of the Treasury are hallmarks of both candidates' campaign pitches.

Torsella in particular is pushing to get rid of so-called "middle men," which are also known as placement agents. They are generally well-connected people who help investment companies do business with the state.

"The practice we have of paying middlemen to introduce money managers to the state has been at the heart of this ongoing corruption scandal, and that's not surprising," Torsella said. "So I've proposed--and I'm the only candidate who has proposed--banning middlemen."

Voit called the idea unnecessary.

"The treasurers themselves are the ones who have been corrupt," he said. "So he's not solving a problem, he's solving a symptom of the problem."

Voit has a different approach. As part of a strategy he calls the "Hope and Opportunity" plan, he says he'll cut down on working with big companies.

"I'm going to fire Wall Street," he said. "I'm going to hire Pennsylvania investment advisors, of which 20 percent will be minority-owned companies."

In Pennsylvania, the Treasurer's job is to oversee the state's funds, and process payments. They're also in charge of making certain decisions about state assets--like how to invest pension funds.

These duties often go on behind the scenes, but they can have a direct impact on Pennsylvanians.

During last year's budget impasse, for instance, the commonwealth went months with an incomplete spending plan, and so it fell to the Treasurer to decide if certain things-- like prisons--would be funded.

And this year, after revenues fell below projections in the first quarter, the Treasury provided the state with a line of credit to pay immediate expenses.

Both candidates said they'd probably handle that situation differently.

Voit said point blank, he doesn't approve of the credit line.

"I would not [provide one], because there is no clear plan on how to pay it back, he said. "As a steward of the taxpayers' money, it is my responsibility to say no."

Torsella said he thinks the current situation's a result of a bigger issue--the state not facing up to its financial problems.

"What you'll hear from me as Treasurer is pointing out when we're steering into dangerous fiscal waters," he said. "I'm going to make that--try to make that--much more understandable to the average citizen."

Whoever's elected may well have a chance to deal with this very issue.

Matthew Knittel, director of the state's Independent Fiscal Office, said while he expects some revenue growth post-election, the commonwealth might continue to struggle.

"It does appear that in particular business, and business investment, has been very weak and we keep expecting that to pick up and it hasn't," he said. "The latest data for the third quarter, in fact, showed--once again--weakness in business investment."

Torsella and Voit are the major party candidates running for Treasurer, but they're also joined by Libertarian James Babb, and Susan Combs, of the Green Party.

In the presidential race, Clinton is currently leading in Pennsylvania by about five points, according to an average of recent state polls.

In general, down-ballot candidates--like those running for statewide row offices like Treasurer--have better luck when the top of their ticket does well.

Published in News, State House Sound Bites

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