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February 22, 2013 | By | Posted in General News

Week in Review: Big budget brings big questions, convicted justice’s fate unknown

By PA Independent Staff

HARRISBURG — Lawmakers are beginning to get their hands dirty examining Gov. Tom Corbett’s $28.4 billion budget proposal for next year.

BUDGET HEARINGS BEGIN: Budget hearings, when lawmakers hear from department heads about their specific needs, kicked off Tuesday and will continue through early March.

Pennsylvania department leaders were grilled by state lawmakers this week as budget hearings began. They’ll continue through early March.

Elsewhere in the state, lawmakers and the Corbett administration are working on big-picture proposals to pitch this session. That includes potential changes to borrowing programs and liquor privatization.

And, the administration is still picking up the pieces after Attorney General Kathleen Kane denied its contract to privatize management of the Pennsylvania Lottery with Camelot Global Services on the grounds of the contract’s constitutionality. The administration extended its bid deadline with Camelot through March 18. It has until March 16 to appeal Kane’s decision.

But the news most likely to make the Pennsylvania history books is the conviction of Supreme Court Justice Joan Orie Melvin, which writes the latest chapter on corruption in the commonwealth’s judicial branch.

Budget hearings shine light on financial crunches

State lawmakers had the chance to question department heads on a number of issues this week, from the state’s pension crisis to gun control to day-to-day operations of the state.

But all the hearings touched on the costs of running the state — and those costs are ever-increasing.

One request from multiple agency leaders was more funding to cover increasing pension and health benefit costs. Attorney General Kathleen Kane and Auditor General Eugene DePasquale both told lawmakers failing to cover these costs would leave holes in their budget of millions of dollars.

AUDITOR GENERAL DEPASQUALE, who testified in front of the House and Senate this past week, said his agency is in dire need of technological upgrades.

Testimony also gave lawmakers a clearer financial picture of where the state is headed. That included information on tax revenue, already shifting after the federal payroll tax exemption expired at the start of 2013 and affecting consumer spending.

Lawmakers also heard about struggles specific to each department, like DePasquale’s concerns that outdated technology is holding back the number and efficiency of audits his department can handle.

For a list of full budget hearings, click here for the House Appropriations Committee and click here for the Senate Appropriations Committee.

Supreme Court Justice Joan Orie Melvin convicted

Pennsylvania Supreme Court Justice Joan Orie Melvin is likely headed to prison following a conviction this week on six of seven corruption charges.

But the fate of the justice’s seat on the bench is still up in the air.

Orie Melvin, who is suspended from her role as a justice, was accused of using government funds and staff to run her Supreme Court campaigns in 2003 and 2009.

In light of that conviction, it’s unclear what happens to Orie Melvin now. She could voluntarily resign from the seat, or the sentencing judge could order her removed from office. But the Associated Press reported Friday that GOP lawmakers are preparing for impeachment hearings in the House of Representatives in the event Orie Melvin does not resign.

The justice’s sister, Janine Orie, who worked as an administrative assistant, also was found guilty on related charges.

Push to expand Medicaid continues despite Corbett’s stance

Gov. Tom Corbett may have said he does not believe Pennsylvania should participate in the federal Medicaid expansion under the Affordable Care Act. But that’s not stopping supporters of the law from making their case.

The Pittsburgh Post-Gazette reported that Families USA and the Pennsylvania Health Access Network estimate that participation would bring 41,200 jobs and $5.1 billion in increased economic activity to the state, according to a new study.

Senate Democrats in the statehouse also touched on the issue during a Tuesday budget hearing. Senate Appropriations Minority Chairman Vincent Hughes, D-Philadelphia, asked Budget Secretary Charles Zogby to provide the financial reasoning behind the administration’s assertion that the expansion would be too costly for the state at this time.

Corbett also has said he does not believe the program would be flexible enough, and has criticized the federal government for not answering Pennsylvania’s questions about the program’s rules.

Changes proposed to economic development borrowing program

Pennsylvania’s most sweeping economic development programs could see a limited spending cap and permanent guidelines under a recently passed proposal.

GABLER: The Elk County representative sponsored legislation to limit the state’s borrowing for economic development plans and instill new approval guidelines.

The state’s Redevelopment Assistance Capital Program (often called “R-Cap”) provides grants with borrowed money for private projects pursued by municipalities and local agencies. Right now, the program’s debt capacity is more than $4 billion.

A proposal recently passed by the House of Representatives would lower RACP’s debt ceiling by $600 million. It also would establish new requirements for the administration to abide by when approving projects.

RACP is often criticized as a slush fund for political pet projects, financed by the state’s borrowing.

Bill sponsor state Rep. Matt Gabler, R-Elk, said the goal is to make the program sustainable — and transparent.

“In our role as legislators, it’s our appropriate role to conduct oversight of the executive branch, to put those requirements into law that we believe are good practices,” Gabler said.

Gabler’s bill now heads to the Senate, and House Majority Leader Rep. Mike Turzai, R-Allegheny, said he plans on seeing the proposal discussed along with the annual budget as “one of the items we bring to the negotiating table.”

Last year, the Republican-controlled Senate did not pass a similar bill that would have lowered the program’s ceiling by $500 million, along with a long-term drop off to capping the program at $1.5 billion.

Liquor privatization proposal looms

Corbett has gone high-profile with his plans to privatize the state-run liquor system, and so far the widest legislative support is coming from the House Republican caucus.

TURZAI: The House Majority Leader will introduce legislation to enact Gov. Tom Corbett’s liquor privatization proposal.

House Majority Leader Mike Turzai, R-Allegheny, is circulating a legislative memo to gather signatures in support of his soon-to-be-introduced liquor privatization measure.

Turzai, a longtime proponent of privatization, was one of many House lawmakers to stand with Corbett at recent news conferences announcing the proposal.

The proposed legislation would shutter the state-owned liquor stores as the only place where Pennsylvanians can buy booze. And it would expand the retail outlets for beer and wine sales, and give beer distributors the opportunity to sell wine and liquor with additional licenses.

The bill “will provide consumers in Pennsylvania with greater selection, better prices, and more convenient access to wine, spirits and beer,” according to Turzai.

The biggest opposition to the liquor proposal will come from labor unions, including the United Food and Commercial Workers, which represents most of the employees in the state-owned liquor stores.

Union boss Wendell Young IV said the UFCW will continue its fight to protect the jobs of its members, the revenue generated by the stores for all Pennsylvania’s taxpayers and the communities that would be endangered by privatization.

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Melissa Daniels is a reporter for PA Independent. She can be reached at 717-350-0962 or Melissa@PAIndependent.com

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