DISTRICT OFFICES:LEHIGH COUNTY:

Northwest Centre, Suite 3026299 Route 309New Tripoli, PA 18066

Phone: (610) 760-7082

BERKS COUNTY:

127 Quarry Road, Suite 1Kutztown, PA 19530Phone: (610) 683-3385

HARRISBURG OFFICE:

PO Box 202187Harrisburg, PA 17120-2187Phone: (717) 787-3017

REP. GARY DAY

187

Legislative District

RepGaryDay.com

PRSRT STDU.S. POSTAGE

PAID

HARRISBURG, PAPERMIT NO. 529

Dear Neighbors,During my first term in office, I have worked with my Republican andDemocrat colleagues to identify waste in government and programs that can be trimmed in order to keep spending in check. This year, I again want toensure the tax burden on wage earners and working families remains reason-able.When creating a state budget, we must look at one simple fact: How muchrevenue is coming in determines what can be spent. We have to live withinour means.Sometimes this calls for some tough decisions and makes for some toughchoices. Last year for the first time in years, because of the efforts of HouseRepublicans, Pennsylvania’s budget was actually less than the previous fiscalyear. This came after a delay of 100 days and despite the governor’s call for more spending and taxes.When economic growth is low and unemployment is high, state revenuestreams dry up. When people lose jobs, they do not pay the personal incometax. Families with less income coming in spend less, meaning there’s lesssales tax revenue. So legislators are faced with difficult choices: restrictspending only to the revenue we have coming in or raise taxes.We have to decide whether we want higher taxes or less spending. Most of us here at home reduce our spending when faced with less income, so that’swhat I think Pennsylvania should do.In the end, the adopted budget was closer to House Republican proposalsthan the governor’s 2009 budget address or House Democrat proposals. Wehad $25.2 billion in General Fund revenue coming in, but still spent $27.8 billion because we relied on $2.6 billion in federal bailout money.That money is running out, and we have to spend less now or face theconsequences later.We have entered another budget season - which began on Feb. 9 when thegovernor gave his annual budget address. He requested $1.29 billion more inspending for the 2010-11 fiscal year budget, even though revenue has fallen$476.7 million below estimates.In this newsletter, I will provide some details about the governor’s propos-al, as well as some other legislative issues going on in Harrisburg.If you would like to contact me with any questions, please call my office or e-mail me atgday@pahousegop.com. My Web site is

RepGaryDay.com

Open House atBerks CountyDistrict Ofﬁce

Wednesday, March 316:30 p.m. to 7:30 p.m.Maxatawny TownshipBuilding127 Quarry Road, Suite 1Kutztown

To R.S.V.P. call (610) 683-3385.

Day Appointedas RepublicanSubcommitteeChairman

I am pleased to now serve on four legislative committees. I was recentlyappointed to serve as Republican chair-man of the Subcommittee on Arts andEntertainment of the House Tourism andRecreational Development Committeefor the remainder of the 2009-10 sessionof the House of Representatives. Thisappointment came from RepublicanLeader Sam Smith (R-Jefferson).I am also a member of the House Chil-dren and Youth Committee, the HouseInsurance Committee and the HouseUrban Affairs Committee, where I serveas Republican secretary.

Governor Proposes $1.2 Billion Spending Increase

I am concerned that thegovernor has proposeda state budget for the

coming ﬁscal year that ismuch more than taxpay

ers can afford, especially

given that he is asking

for more taxes totaling$874 million.

The governor is askingthat consumers and busi-

nesses pay more taxes

in order to ensure thatfuture budgets - after the

governor is out of ofﬁce- are not dangerouslyunderfunded.Unfortunately, we faceseveral economic chal

lenges:

•Recent economic re-ports have indicated that

General Fund revenuecollections have fallen

short of projections for22 consecutive months

through February 2010.

•

Pennsylvania is be

hind last year’s revenuecollection estimates byabout $476.7 millionduring the ﬁrst eightmonths of the 2009-10ﬁscal year.

•

By June 30, the

governor estimated that

the Pennsylvania budgetcould experience a short

fall of as much as $525million.Faced with such chal

lenges, budgeting is verydifficult for the GeneralAssembly, but apparentlynot for the governor.On Feb. 9, he proposeda $29.03 billion budgetfor fiscal year 2010-11.This includes $26.27 billion in anticipatedGeneral Fund revenueand $2.76 billion infederal stimulus money,which runs out after thisfiscal year. This amounts

to a spending increase of

4.6 percent more than thelast ﬁscal year.The proposal assumes$850 million in addition

al federal bailout moneythat has not yet been ap

proved by Congress.

Different Year, Different Proposed Taxesfrom Governor

As taxpayers might expect, Gov. Ed Rendell once again proposed new taxes to pay for spending – $874 million worth.As with any budget, all ideas should beconsidered and debated, but the ﬁrst thingwe need to do is make the state’s depart

ments even more efﬁcient and prioritize our spending accordingly.Of the $874 million in new revenue re

quested:

•

$531.5 million of these new taxeswould be a result of broadening thestate sales tax to include currentlyuntaxed items.

o The governor has proposed that 74 previously untaxed categoriesbecome taxed.o The annual sales tax a consumer pays will likely increase.o This plan is unlike the planadvanced by Rep. Sam Rohrer (R- Berks), who has proposed for many years that the sales tax be used to lower property taxes, not to pay for general expenses incurred by the state.

•

$140.2 million in taxes affecting businesses, including the removal of a sales tax discountincentive for them.

o Last ﬁscal year, the governor fought for a change in a key business tax – theCapital Stock and Franchise Tax – that cost businesses $374 million.

•

$41.6 million tax on smokeless tobacco and cigars, amounting to 30 percent of the saleprice.

o This was proposed last year and failed to gain any traction among legislators. It is about the same rate that cigarettes are taxed now.

•

$160.7 million in taxes on natural gas extraction.

o Pennsylvania has done incredibly well executing an idea advanced by House

Republicans that leases Marcellus Shale lands. This program brought in $180

million so far.o The governor has proposed two distinct new taxes on Marcellus Shale drilling,

the ﬁrst is a 5 percent tax on the value of natural gas at the wellhead, plus a 4.7-cent tax per 1,000 cubic feet of gas extracted.

Rep. Glen Grell (R-Cumberland, left) discusses thestate budget with Rep. Day during a recent com-mittee hearing in Harrisburg.

gday@pahousegop.com

Public School Employee Pensions Could Force Large Tax Increases

Because of downturns in the investments held by the Public School Employees Retirement System (PSERS), and because theemployer contribution rates have not changed for years, Pennsylvania and its 500 school districts could be facing double-digitincreases in employer contribution rates as soon as 2012. That could mean significantly higher taxes for everyone.Both the state and local school districts must contribute a portion of the costs paid to PSERS for public school employees.This benefit, by contract, guarantees these employees this retirement benefit.If not addressed by the Legislature soon, as more teachers and school employees begin to retire and draw upon pension in-come, we could see a funding crisis.•In his budget address, the governor has proposed an increase in the employer contribution rate to 5.78 percent from the cur-rent 4.78 percent.•However, this is much less than recommended by the Public School Employees Retirement System (PSERS) in December 2009. To ensure solvency of the fund, the PSERS board recommended that the employer contribution rate be increased to8.22 percent.•Both the state and school district pay into the PSERS Fund.•Nothing in the governor’s plan does anything to ensure that future employees will be required to participate in a definedcontribution plan.

Basic Education Funding

•

The governor proposed $5.23 billion in basic education spending for the state’s 500 school districts, which includes$654.7 million in federal bailout money.•

This is $354 million more than last year, a 7.28 percent increase.•

Pre-K Counts, a program making quality pre-kindergarten opportunities available to children and families, will be cut by $475,000 to $85.9 million.•Public library funding is cut by $1.2 million to $58.8 million statewide.

gday@pahousegop.com

Transportation Projects Paving Wayfor Safer Travel in the 187th District

Berks County

Route 222, Kutztown Bypass Rehabilitation .....................................................................................................................Recently Bid, $13 millionSR 1010, Blair Creek Inn Bridge ............................................................................................................................................To be Bid in mid 2010SR 1021 Bridge over Mill Creek.............................................................................................................................................To be Bid in late 2010Route 222 Betterment, Kutztown Bypass to Lehigh Co. Line ................................................................................................To be Bid in late 2010Route 662, Ontelaunee Bridge ..............................................................................................................................................To be Bid in late 2011

Lehigh County

Route 100, Widening from Schantz Road to I-78 .........................................................................................................................Ongoing ProjectRoute 100 and 309 Intersection Improvements ...................................................................................................................To be Bid in early 2010SR 4009, Newside Road Bridge ..........................................................................................................................................To be Bid in early 2010Route 309 Bridge over Mill Creek ..........................................................................................................................................To be Bid in mid 2010SR 4025, Frantz’s Bridge .......................................................................................................................................................To be Bid in mid 2010SR 4027 Bridge over Jordan Creek .......................................................................................................................................To be Bid in mid 2010Hunters Hill Road Bridge .......................................................................................................................................................To be Bid in late 2010SR 4037, Donats Road over Ontelaunee Creek ....................................................................................................................To be Bid in late 2010Route 100 and Clausville Road, Intersection Improvements .................................................................................................To be Bid in mid 2011 Also, these major transportation projects were completed last year: widening and signalizing ramps at the Interstate 78 and Route 100interchange; micro-surfacing from Adams Road to east of Route 100 at I-78; and safety improvements and widening at Route 309 at PackhouseRoad.Recent severe snowstorms once again closed major interstate highways for brief periods, including I-78, and have severely taxed both stateand local highway budgets.With the coming budget, we as a state need to ensure that the core functions of government are funded ﬁrst. Tax dollars should go towardroad repairs, bridge maintenance and highway safety improvements.This is not the time for expensive new projects and initiatives when the basic functions of government need to be accomplished ﬁrst.

On March 3, Rep. Day visited Fogelsville Elementary in the Parkland School District tocelebrate Read Across America

Route 222 Survey Results

Last year, I asked residents of the 187th District who live along the U.S. Route 222 corridor one question:What is the best way to alleviate trafﬁc congestion on U.S. 222?

It was not a scientiﬁc survey, but the results are interesting.Of four possible courses of action listed, as you can see, expanding to four lanes was favored by nearly 50 percent of the respondents.

222 is ﬁne the way it is. No changes are needed.

1 percent

Construct a bypass around local business districts.

25 percent

Improve the intersections in the region including where U.S. 222 intersects with Routes 73, 662, 863, and Genesis Drive.

26 percent

Expand Route U.S. 222 to four lanes.

48 percent

Rep. Day with Ironton Elementary Principal Lynette Smith and school mascot Star Stallion during Read Across America Day.