State House Sound Bites

Capitol reporter Katie Meyer covers Pennsylvania politics and issues at the Pennsylvania state capitol.

Tension rises between House GOP and Wolf; general fund teeters near zero

Written by Katie Meyer, Capitol Bureau Chief | Aug 29, 2017 9:24 PM

The governor sent an ultimatum-like letter to House leaders, urging them to finish a budget before the state's fiscal situation gets any worse. (Photo by AP)


(Harrisburg) - The main fund the commonwealth uses to pay its bills would have hit zero this week, if not for a $700 million transfer from the state's Motor License Fund.

A spokesman for Governor Tom Wolf said the transfer buys the state a little time, and allows it to at least make payments to school districts for the start of the school year.

Governor Tom Wolf sent a dire letter to House Republican leaders Tuesday urging them to pass the Senate budget plan quickly, or else state programs could be affected.

In recent weeks. the state Treasury and the governor have been warning repeatedly that the general fund is close to empty.

Usually when that happens, the Treasury loans money to tide the fund over.

But Treasurer Joe Torsella has said he won't do so without balancing the budget--which still $2.2 billion short.

The short-term Motor License transfer is highly unusual, and the money will likely run out around September 15.

It's unclear what Wolf will do if that happens and there's still no revenue plan in sight. Treasury Spokesman Michael Connolly said options include deferring payments or freezing spending.

"What we have is revenue that's going to be coming in, and we have obligations that are due to pay some things," he said. "The governor's office could decide to do that with some things and not others; they could try to do that with everything, or none of it."

Among the payments due on the 15th are payroll for state workers, including lawmakers and their staff.

Meanwhile, House GOP Spokesman Steve Miskin said his caucus doesn't think the governor is committed to negotiating.

"He's never called a meeting," Miskin said. "What concrete thing has the governor done to try and build a consensus?"

House Republicans are working on a plan that allegedly balances the budget on one-time fund transfers, instead of borrowing and tax increases.

It's unclear if it will get enough support to pass the House, much less be agreed to by the Senate and governor.

The House is scheduled to resume session September 11-- four days before the general fund likely hits zero again.

Published in News, State House Sound Bites

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