- Associated Press - Wednesday, June 29, 2016

HARRISBURG, Pa. (AP) - The Pennsylvania Senate took quick action on the House’s just-passed budget package Wednesday, a day before the state government’s fiscal-year deadline, although divisions remained over how to pay for the nearly $31.6 billion spending plan.

The Republican-controlled Senate voted 47-3 after making changes to the plan the House passed a day earlier with bipartisan support.

Both chambers adjourned Wednesday, to return Thursday. House Speaker Mike Turzai, R-Allegheny, said his chamber would move quickly to review the Senate’s changes, but did not say how his chamber would handle it.

The swift movement comes barely two months after the end of a record-breaking stalemate that marked the first budget between Democratic Gov. Tom Wolf and the Republican-controlled Legislature.

The spending plan passed by the Senate calls for a 5 percent increase, or $1.5 billion, driven primarily by pension obligations, prisons and human services, as well as $200 million in new aid for public school operations and instruction, a 3 percent increase.

“It increases higher than what we’d like. It does that because of the items we’re forced to pay for,” Senate Majority Leader Jake Corman, R-Centre, said. “We still want to make investments, and we did that in education. It’s a significant investment in education, despite these difficult times.”

However, there is no concrete agreement on how to pay for an election-year budget plan that the Legislature dramatically slimmed down from what Wolf originally sought.

In a statement, Wolf praised the Senate’s budget plan, but his office was noncommittal on whether he would sign it, should the House pass it.

The state’s 2016-17 fiscal year begins Friday.

A House strategy to raise $1 billion to plug state government’s deficit-plagued finances has thus far been panned by Wolf as inadequate, and it was not clear how much support it had in the Senate.

Also unclear Wednesday was whether the $1 billion could wipe out the long-term deficit that has damaged Pennsylvania’s credit rating. The Legislature’s Independent Fiscal Office has projected the deficit to be $1.8 billion in the 2016-17 fiscal year.

The House’s $1 billion would theoretically come from higher tobacco taxes, brisker wine and liquor sales, more legalized gambling and tax delinquents. In particular, the proposal to expand casino-style gambling in Pennsylvania to the internet, airports and off-track betting parlors has prompted criticism by Senate Minority Leader Jay Costa, D-Allegheny, that it is based on unrealistic projections.

The House also had yet to show the details of a package of increases on sales of cigarettes and other tobacco products that underpins its $1 billion funding plan. The Senate’s Republican majority has not proposed an alternative funding plan, while Senate Democrats have pressed the idea of reinstating a gross receipts tax on natural gas utilities in Pennsylvania.

In any case, Republicans have squeezed significant concessions from Wolf. He had initially proposed a $33.3 billion budget plan, including another $350 million for public schools, to be financed by a $2.7 billion package of tax increases.

Sen. Vincent Hughes, D-Philadelphia, called the Senate’s budget plan “austere,” but noted that lawmakers had learned lessons from the stalemate that ended in April.

“It represents a divided government,” Hughes said. “It represents and respects each other in this process, and it incrementally moves the people of Pennsylvania forward. … We learn from the fact that this is divided government, and learn from the fact the incremental gains are gains nonetheless.”

The plan takes out nearly $700 million from Wolf’s initial proposal to add $1.1 billion to the Department of Human Services, in part by revising caseload projections and Wolf putting off planned initiatives.

The reductions prompted social services providers, including counties and The Arc of Pennsylvania, to warn about further squeezing crucial programs, such as children and youth services and emergency services for intellectually disabled adults.

The plan also leaves unanswered the question of how the state will pay for what could be billions of dollars in borrowing for school construction costs in the coming years.

One crucial difference between the House and Senate spending plans was $39 million inserted by the Senate for higher education, a 2.5 percent increase. The House had allocated no new aid for state-subsidized universities and grants for college students.

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