Deal reached, state budget expected to move on Monday
By Eric Boehm | PA Independent
HARRISBURG — A budget agreement reached Thursday puts Pennsylvania on track for its first on-time budget in eight years.
Republican legislative leaders and Gov. Tom Corbett agreed to a $27.15 billion budget, about $850 million less than the current fiscal year. The state Senate plans to pass the budget as early as Monday, sending it back to the state House with four days remaining before the constitutional deadline of June 30.
“There is an agreement in principle,” said Erik Arneson, spokesman for Senate Majority Leader Dominic Pileggi, R-Chester. “There is an agreement on the overall spending level, on many, but not, all of the programs. But there are a lot of details still to be worked out.
When all is said and done, the budget will spend less in the general fund than the governor’s initial proposal in January of $27.3 billion. However, part of the deal moved $300 million in spending to an off-budget account, so the final figure is actually slightly higher than what the governor had proposed initially.
That $300 million — from the state’s Tobacco Settlement Fund — has been off the main budget always, but Corbett proposed in March to include it this year.
Both chambers plan to return Sunday afternoon to discuss the deal with rank-and-file members and prepare bills for passage Monday. The budget bill is sitting in the state Senate, which will amend the bill and send it to the state House. At that point, the lower chamber will wait 24 hours before moving the bill to Corbett’s desk for consideration.
Earlier in the day, Corbett said he was pleased with the progress on the budget.
"I have confidence that we will have a budget on time," Corbett said.
Despite a deal being reached, Thursday was not all smooth sailing for the Republican budget plan.
Senate Democrats released estimated revenue figures showing the state’s year-end revenue surplus to be about $675 million and renewed their calls for Republicans to spend some of that money and restore budget cuts.
Republicans estimate the surplus will be about $625 million at the end of the fiscal year.
Arneson said some of the surplus revenue was being used to restore cuts in basic and higher education, but not as much as Senate Democrats would have wanted.
“I don’t know that anyone is going to be completely satisfied with this budget,” said Arneson. “It’s been a tough, difficult year and I think we’re certainly doing a very responsible budget.”
Another complication to the budget was revealed Thursday when Grover Norquist sent a letter to Corbett and members of the General Assembly calling a proposed increase to the state’s assessment on hospitals was a “tax,” not a “fee.”
Norquist is a conservative activist and president of Americans for Tax Reform, the Washington, D.C., policy center behind the “Taxpayer Protection Pledge.” Lawmakers who sign the pledge promise not to raise taxes or create new ones during their time in office.
More than 30 lawmakers in Pennsylvania have signed the pledge, including the governor.
In the letter, Norquist said a proposed 9-percent increase in the hospital assessment would result in a $40 million added burden for patients to pay. He also said the increase would not violate the pledge, if an equal offset could be found by cutting taxes or fees by $40 million elsewhere in the budget.
Corbett said he believed the increase to the hospital assessment was indeed a fee and not a tax, because it is described as a “fee” in the existing law.
A natural gas impact fee, which has been another major sticking point of the budget negotiations, will not be included in the proposed budget. However, Democrats and some Republicans plan to try to amend an impact fee into the budget language when it is debated next week.
“That needs to be a part of the conversation,” said Senate Minority Leader Jay Costa, D-Allegheny.
Democrats, who hold the minority in both chambers of the General Assembly, have been largely kept out of the budget conversations.
Corbett on Thursday reiterated his plan to veto any bill which included a tax or fee on natural gas.
