PRSRT STDU.S. POSTAGEPAIDHARRISBURG, PAPERMIT NO. 529
Time is Now to Get Serious About State Budget
I commend the governor for hisstated intention to get the budget doneon time this year. In each of his sevenyears however, the governor hascreated a crisis and only negotiatedseriously after the ﬁscal year ended.In fact, this tactic last year led to abudget stalemate that went a record101 days beyond the state mandatedJune 30 deadline. It disrupted lives,hurt families and interrupted importantprogram funding. To get this budgetdone on time, the governor must provehe is serious and get to work beforeJune 30. If he does, both parties in theLegislature will gladly reciprocate.In his remarks, the governor boasted about digging out of a budgethole. However, it is a budget hole of his making. While state revenues arein decline, the budget hole of whichhe speaks cannot be blamed on thisalone. In fact, our current ﬁscal crisisis as much the result of the governor’sspending policies as any reduction inrevenue.During eight years of Gov. Rendellbudgets, the rate of inﬂation has risenby about 24 percent, yet state spend-ing is nearly double that in the sameperiod! If state spending increasesunder Rendell had kept pace with in-ﬂation, we would be looking at a $25.2billion budget this year, instead of $29billion. Revenue would be sufﬁcient tosustain this level of spending.Another problem with the pro-posed budget is that it relies heavilyon federal stimulus dollars, which willhelp to grow state programs for whichfunding will not be available in futureyears.The governor’s current budget planis only balanced assuming the federalgovernment comes through with the$800 million in stimulus funding itpromised; $92.5 million in revenue israised through table games and $180million is raised through leasing morestate land for Marcellus shale gasdrilling. This revenue is speculativeat best and a perfect storm is looming.Two years from now, federal stimulusfunds will dry up at the same timePennsylvania’s pension crisis will hit.This could leave the state billions of dollars in debt.Governor Rendell also proposes toreduce the sales tax rate from 6 per-cent to 4 percent and broaden the listof products and services to be taxed.Yet, when I supported efforts to do thisto
school property taxes,Democrats in the Legislature decriedit as regressive, unfair and unwork-able. I believe this action should onlybe taken for the purpose of eliminat-ing school property taxes as opposedto a tax increase to accommodateincreased state spending.Pennsylvania is facing a potential$525 million shortfall by the end of thisﬁscal year (June 30). Now is not thetime to ramp up spending on the hopethat Pennsylvania’s economy will turnaround. While the governor brags of eliminating programs and positions tocut spending, he continues to fund andpropose tax credits for big Hollywoodin the amount of $60 million.We must pass a budget that re-ﬂects the economic realities our stateand our citizens are facing. To avoidlayoffs and disruption of governmentservices, I am urging legislation be ad-opted to continue the previous year’sbudget, minus a percentage acrossthe board reduction reflecting anyend of year deﬁcit. This proposal willensure a continuation of state servicesand funding for vital needs while a ﬁnalbudget is negotiated.
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