Gov. Tom Corbett is proposing reforms to ease the burden on taxpayers posed by the two massive pension funds for state employees and public school teachers that are currently underfunded. The state’s two big pension funds are in trouble because of a combination of volatile stock market performance, underfunding by the state — and the 2001 pension grab in which state lawmakers gave themselves a 50 percent pension increase and then gave most other state workers and public school teachers a 25 percent pension increase.

Corbett is proposing some sensible reforms, like governors in other states, that would shield taxpayers from some financial pain by asking current beneficiaries to pay more into the system and by shifting new hires to a defined-contribution program, similar to the 401(k) plans that most private-sector workers have for their retirement.

Pension reform is a high, if also controversial, priority, in many states. But a lesser-known reform than relates to public employee pensions is also getting some well-deserved attention. That reform effort has to do with binding arbitration between a municipality and its organized employees and would require that the municipality’s ability to pay be considered in the arbitrator’s ruling.

In Pennsylvania today, an arbitrator may consider the municipality’s financial condition, or ability to pay, but it is not mandatory. That should change. It makes no sense to ignore a municipality’s ability to pay when arbitrating a contract dispute.

This week, the Coalition for Sustainable Communities (CSC), which includes chambers of commerce and business groups, urged Corbett and state lawmakers to expand pension-reform efforts to address the burdens placed on struggling municipalities by artibration rulings that do not consider the ability to pay.

Brian Jensen, executive director of the Pennsylvania Economy League of Greater Pittsburgh and a member of the CSC, noted that “a financially distressed municipality can go into an arbitration hearing and end up with an award that they cannot afford to pay. There’s no provision in the law to forbid that.”

Jensen is right to argue for mandating the ability-to-pay provision. It’s common sense and a small step toward protecting taxpayers.

Beyond requiring that arbitrators consider the municipality’s ability to pay, the CSC offers other ideas, including that arbitrations be open to the public and that both parties share the cost of arbitration, which is currently paid for by the municipality.

In New York State, Gov. Andrew Cuomo is being criticized by labor groups for his plan dealing with the same issue. Cuomo, a Democrat, wants wage and benefit increases produced by arbitration to be capped at 2 percent if the municipality has an average reserve fund that is less than 5 percent of its budget, or if the local tax rate is in the top 25 percent in the state.

Cuomo admits the “ability to pay” concept is controversial, and he was blasted by the head of the International Association of Firefighters, who said the reform measure would “eviscerate the binding arbitration rights” of emergency responders.

Most people would disagree — seeing the idea as an overdue common-sense change that would give the taxpayers some minimum level of protection.

Corbett should embrace the CSC reform proposals, giving greatest weight to the ability-to-pay provision. Only the most biased observers will fail to see the logic in that change.

If Corbett feels the need for political cover, he can look to Cuomo, and other governors, including Democrats, who see the need for reforms to level the playing field between taxpayers and public employee unions.