Budget Wrap Up
continued from page 1.
Tax Increases
e uget ncues a -cent-per-pack increase in the state tax on ciga-rettes and creates a new tax on “littlecigars” at $1.60 per pack. The statespending plan also calls for a $374million tax on Pennsylvania employersat a time when the Commonwealth’sworers an o creators are ree-ing from the international economicrecesson.n addition, the budget includes atax on eca anage are r-ganizations (MCOs). The good newss tat we te state spenng panincludes the targeted tax increasesaove, ouse epucans were aeto block several new or increasedtaxes proposed by Gov. Ed Rendell.t varous ponts urng te ugetprocess, the governor called for botha ersona ncome ax ncreaseand an expansion of the state Salesan se ax . e were ae toblock both of these broad-based taxncreases.n addition, the governor proposeda severance tax on natura gas ar-vested in Pennsylvania. This wouldhave stunted the growth of Pennsyl-vanas emergng arceus aenatural gas industry, resulting in fewer goo-payng os or ennsyvanaworkers. We were also successful inavertng ts o-ng tax proposa.
Draining the Reserve Accounts
Budget negotiators balanced thestate spenng pan, n part, y ranngseveral reserve accounts. The Com-monwealth had built up a 755 millionRainy Day Fund that is intended tohelp pay for unanticipated expenses.That fund will be completely depletedduring the current budget year.he budget also calls for depletingthe $708 million Health Care Provider Retention Account and taking 100million from the MCare Fund. Both of tese uns are use to ep cover the cost of medical malpractice for theeat care nustry.urthermore, $150 million wouldbe taken from the Tobacco Settlementfund, which receives money from afederal lawsuit and allocates thosefunds for tobacco prevention andstatewide health care programs.y ranng te states reserveaccounts, nothing will be availablenext year. s cou e evastatngin the event the economy does notturn around. Given the fact that staterevenues are already $217 millionshort for the year, this is a seriousconcern.
Federal Bailout Dollars
After being sworn into office, Presi-dent Barack Obama and the Demo-crat-controlled Congress in Wash-ington, D.C., acted swiftly to approveseveral bailout measures. One of those was the American Recoveryand Reinvestment Act (ARRA), which,among oter tngs, prove eeradollars to subsidize state budgets.e ennsyvana state ugetincludes more than $2.6 billion ineera aout money. e to tenearly $25.2 billion in state dollars inthe final budget, this means the Com-monwealth will spend approximately$27.8 billion in the current spendingplan.Due, in part, to the extensive useo eera oars or eucaton, scoodistricts in the 68th Legislative Districtreceve moerate ncreases n un-ing within the state budget. Althougham an avocate or eucaton, tslevel of spending cannot be main-tained once the federal money runsout in a couple of years, which meanstaxpayers will have to make up the dif-ference. This, in my opinion, will createa serious funding gap and potentialcrss n te uture.
House Republican Plan
House Republicans presentedsevera spenng pans troug tebudget process, including the mostcompreensve pan create wt teinput of several key House Demo-crats (House Bill 1943). Only partialwithdrawls from the reserve accountsand none of these new and increasedtaxes would have been necessaryunder the House Republican budgetproposa, wc was never rougtbefore the General Assembly for con-seraton y te emocrat-controeHouse.
F ME INTN, VST ME ON
2010-11 Budget Process
e w e worng on te -budget in less than three months, andwe must follow our constitutional obli-gation to get a balanced state budgetpasse on tme.There are several legislative pro-posals currently being circulated thatmgt ep expete te process anput measures in place to hold theenera ssemy more accountae.Those initiatives should be comingeore te ouse an enate n tenext few months.
2009-10 Education Funding for 68
th
Legislative District
*Special education funding will remain the same as last year. Federal funding(ARRA) willprovide additional money; however, this funding is only available for three years.School District Basic Basic ARRA ARRA andEducation Education Funding Basic EducationFunding % Increase % Increase Canton Area $6.81 million 2.70% $368,021 7.5%Galeton Area $2.06 million 2% $150,166 8.4%Northern Tioga $12.39 million 5.21% $834,062 10.9%Southern Tioga $8.62 million 4.19% $678,589 10.8%Troy Area $9.10 million 3.78% $564,130 9.1%Wellsboro Area $5.97 million 4.74% $620,266 13.5%Rep. Baker received the 2009 Friend of Penn State Legislative Award, which was presented byPenn State University President Graham Spanier. Pictured above (from left to right) is Spanier;Baker; Baker’s wife, Brenda; and Penn State Alumni President David Han, M.D.
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