State House Sound Bites

Capitol reporter Katie Meyer covers Pennsylvania politics and issues at the Pennsylvania state capitol.
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Wolf banking on unconfirmed Treasury loan for payments this month

Written by Katie Meyer, Capitol Bureau Chief | Oct 11, 2017 2:58 PM
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The governor held a press conference Wednesday to tout savings from his GO-Time initiative. (Photo by Katie Meyer/WITF)

 

(Harrisburg) -- Governor Tom Wolf has gone public over the past two days to promote his plan to balance the state budget without action from the legislature.

It mostly involves borrowing, and a number of smaller cost-saving measures. But a lot is still unknown about it.

For instance, Wolf's plans to borrow money against the state liquor industry and Farm Show complex in Harrisburg could see challenges from lawmakers who think the governor doesn't have the authority to make those decisions.

The state Liquor Control Board held a voting meeting Wednesday and briefly discussed the governor's proposal. But a spokeswoman says while the LCB recognizes they need to act expeditiously, they have to get more information before deciding whether to go forward with securitization. 

It's also not clear how much the governor is expecting to make from managing state complements and other cost saving measures.

But one of the biggest questions is whether the state can make short-term payments.

Sizeable Medicaid payments are coming due this week and public school costs have to be covered by the end of the month. Wolf said the general fund is hitting a low point right now, and will need a loan from the Treasury if it's going to meet those obligations.

"We have, actually, a big reimbursement coming from the federal government for money we have spent. But I think there's like a three or four-day gap, sometime right around now," Wolf explained.

The Treasury has said it won't authorize a loan without a plan to balance the budget, and so far, the office said it doesn't have enough information from the governor. 

But Wolf maintains he's extremely sure the administration won't have to delay any payments.

When asked at a press conference what his backup plan is if the Treasury says no, he said he's not making one.

"I don't have [a backup plan]," he said. "That's how confident I am that the Treasurer will see great virtue in what I'm doing to manage the finances of this state."

Wolf had previously indicated the lending was a done deal, but clarified, saying he didn't mean to put words in Treasurer Joe Torsella's mouth.

Republican lawmakers have criticized the potential loan, saying the budget's no more balanced now than it was two months ago, when the Treasury refused to lend cash to cover expenses.

It's still unclear exactly when Wolf thinks the Treasury will authorize a loan, or how much it will be. His office didn't respond to questions about what day mid-month payments are due. 

Published in News, State House Sound Bites

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