Corbett unveils $28.4B state budget

Written by Craig Layne, Morning Edition Host/Reporter | Feb 5, 2013 11:52 AM
Tom Corbett

(Harrisburg) -- Governor Corbett has unveiled a $28.4 billion dollar state budget. Speaking at the State Capitol this morning, he outlined a spending plan that does not raise taxes and represents a 2.4 percent increase in spending from the current year. It includes $90 million in basic education spending and the start of a $1 billion block grant that would fund certain programs for four years from the proceeds of selling state liquor stores. The budget proposal includes the elimination of the Capital Stock and Franchise Tax, and the reduction of corporate net income tax to 6.99 percent over 10 years.

The budget also delves into pension reform, proposing new state and public school employees be enrolled in a 401(a) plan that would be require state workers to contribute at least 6.25 percent of their salary and teachers to contribute 7.5 percent. Current employees will not see any changes to benefits already accrued, Corbett said. Retirees will not see any changes in benefits, he added.

In an effort to begin plugging the commonwealth's $3.5 billion transportation funding hole, the governor called for removing the cap of $1.25 per gallon on the wholesale price of gasoline. He also proposed reducting the state gasoline tax by a penny per gallon this fiscal year, and by another cent in 2014/2015. The tax is currently 12 cents per gallon.

Corbett's proposed spending plan slashes funding for the state Agriculture Department by 9 percent. Farming is the state's largest industry. It keeps funding flat for the Attorney General and Auditor General's offices. The Pennsylvania Higher Education Assistance Agency's funding also remains the same. Higher education sees a negligilbe increase of .001 percent ($200,000). Basic education gets a 1.7 percent funding boost under the budget. The Department of Community and Economic Development sees the highest boost in funding under Corbett's proposal, at 7 percent.

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