The Tribune Democrat, Johnstown, PA

State News

June 29, 2014

GOP’s patchwork $29.1B budget speeds toward votes

HARRISBURG — A $29.1 billion Pennsylvania state government budget plan held together by a patchwork of cash diversions and other maneuvers was poised for its first floor votes Monday, the last day of the fiscal year after a rocky spring session for Republican majorities.

Republicans, who control the Legislature, unveiled the main appropriations bill Sunday night during an unusual weekend session as the clocked ticked down on the fiscal year. House and Senate floor votes on it were expected Monday, while a large companion bill had not been finished as of Sunday night.

However, Gov. Tom Corbett, a Republican, has not said how he will handle budget legislation after threatening during the past two weeks not to sign it until lawmakers pass a bill that cuts future public employee pension benefits and liberalizes state laws on the sale of alcohol.

Democrats promptly attacked the Republicans’ budget plan as inadequate for the state’s suffering public schools, saying it was built on flimsy assumptions in a bid to avoid a tax increase.

They also complained that the budget bill does little to reverse deep cuts in aid to schools and safety-net programs that Republicans engineered during the past three years to balance the budget.

“This is a failed budget,” Sen. Vincent Hughes, D-Philadelphia, told his Republican counterparts during a committee vote.

The big challenge for Republicans was to try to fill a $1.7 billion gap that was torn into Corbett’s $29.4 billion budget plan by a massive and unexpected shortfall in tax collections.

To do it without raising taxes, Republicans needed to scrounge up more than $2 billion in one-time items, including by postponing bills, raiding off-budget programs and draining reserves, Democrats say.

That is the highest dollar figure for such stopgaps in any year, not counting the $6.9 billion in federal recession bailout dollars that came to Pennsylvania from 2009 to 2011.

Republicans insisted their budget projections were sound, and they defended their efforts to assemble a viable budget plan amid a massive and unexpected collapse in tax collections.

Senate Appropriations Committee Chairman Jake Corman, R-Centre, said his chamber’s Republicans would have joined Democrats to support some sort of tax increase, but that House Republicans would not have supported one.

“The fact is, they didn’t have the revenue votes, they weren’t going to have the revenue votes, so you deal with the budget you have,” Corman said.

Under the Republicans’ budget plan, spending would increase $723 million, or 2.5 percent, over the current year’s approved budget. However, another $220 million would be added to the books of the nearly-ended fiscal year, rather than the new fiscal year, making the entire package a $943 million increase, or about 3.3 percent.

The Republicans’ budget bill would increase spending on public schools, public pensions, health care for the poor and social safety-net programs, like those for the intellectually and physically disabled. Republicans said the plan keeps a grab-bag of planned business taxes intact.

But it pares back some of the increases sought by Corbett in his $29.4 billion plan, including reducing Corbett’s new “Ready to Learn” block grant program from $240 million to $100 million.

A budget bill passed last week by the House had slashed some tax credit programs and counted $380 million from sales of wholesale or retail liquor licenses, even though Corbett-backed legislation to do that is essentially dead. The Senate bill got rid of both.

Democrats had proposed making up the shortfall by expanding Medicaid under the 2010 federal health care law, delaying planned tax cuts for businesses and increasing taxes on the booming natural gas industry and sales of tobacco products.

Those ideas have split House and Senate Republicans and ultimately were rejected by leaders of both.

Meanwhile, Democrats have opposed GOP ideas on pension cutbacks and liquor sales, and Republicans have been unable to corral enough votes from their members to get a bill on either subject to Corbett’s desk.

 

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