State House Sound Bites

Capitol reporter Mary Wilson covers Pennsylvania politics and issues at the Pennsylvania state capitol.

No-tax budget teed up for final votes Monday

Written by Mary Wilson, Capitol Bureau Chief | Jun 29, 2014 11:27 PM
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Photo by Mary Wilson / witf

A roughly $29.1 billion state budget is poised for final votes in the House and Senate Monday.

The plan includes no new taxes, and appears likely to go to the governor before the midnight deadline.

Democratic lawmakers and some Republicans are noting the number of one-time funding sources and optimistic tax revenue forecasts baked into the plan.

The proposed spending blueprint relies on nearly $250 million in transfers from funds for small business loans and other programs.

It assumes $125 million in savings to come with federal approval of the governor's proposed alternative to Medicaid expansion.

The measure increases by $20 million the estimated revenue from the governor's proposed expansion of natural gas drilling under state parks and forests. Lawmakers and staff said the new figure is based on conversations with people in the drilling industry.

"This is called moving the numbers around," said Sen. Scott Wagner (R-York), who took office in April. "That's what they call it in the private sector."

But GOP legislative leaders defended the maneuvers.

"Nothing too out of the ordinary for a tight budget year," said House Speaker Sam Smith (R-Jefferson). He acknowledged the optimistic revenue estimates included in the plan. "Just a little bit, there," he said. "Little tweak there."

The tweaks include scaled-up revenue growth estimates for the fiscal year beginning in July, as well as the current fiscal year. Lawmakers chalked up the latter adjustment to better-than-expected June tax collections.

"Everything's an estimate," said Sen. Jake Corman (R-Centre), chairman of the Senate Appropriations Committee. "Hopefully we're correct."

The proposal restores tax credits the House GOP voted to cut. It also replaces $380 million that the House's budget assumed would come from liquor privatization (a bill that has been stalled for a year).

The proposed budget includes no increase to the main $5.5 billion pot of money for schools. But it doubles a $100 million block grant and targets the money for growing school districts.

"I think that's probably the first time to recognize these schools that are busting at the seams with growth but not getting any more money to educate," said Corman.

The Senate Appropriations Committee approved the measure Sunday evening, readying it for final votes in the full Senate and full House. Spokesmen for the Republican caucuses of both chambers expect final votes will happen Monday.

Published in State House Sound Bites

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Comments: 1

  • Maria Smith img 2014-10-27 04:38

    I just don't understand, and feel free to explain it to me... Reducing or removing income tax sounds great! But, if all to get there, we are raising State sales tax, borrowing from the KDOT bank, cutting funding to schools and safety net programs and cutting out long standing deductions, what is the benefit? And all this to lower the rate less than 1 percent. If the State does in fact opt to get to zero income tax, what will have to give up to pay for it? It is like touting that you paid off your mortgage early, only to do that, you used all your retirement funds and borrowed the rest from small installment loans lenders.

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