With Easter behind and a Memorial Day break ahead, the Governor and the General Assembly spent most of the last two weeks setting the stage for what is expected to be a long month of negotiations on the state budget in June.
Governor Wolf, his cabinet and senior staff continued their trips across the Commonwealth on the “Schools that Teach” tour, touting his vision of increased education funding, property tax relief and universal pre-kindergarten instruction.
Senate President Pro Tempore, Joe Scarnati said he expects the General Assembly will have a budget package on the Governor’s desk by June 30, but did not seem assuring that the budget sent to the south side of the capitol would become law. He said any budget passed must be acceptable to more than half of his 30 member caucus.
Reports on the state’s fiscal condition continued positive, and now looking at a budget deficit half the size expected in January, Republicans are saying net tax increases may not be the way to go this year. With pension reform and changes to the liquor system, the Senate leader said, the deficit could be erased with no need for the Governor’s proposed $4.5 billion in tax increases. Scarnati noted the proposal does not pass the “red face test.”
The State’s Independent Fiscal Office this week reported that nearly all Pennsylvanians would be paying at least the same amount in taxes after three years of the new approach offered by Wolf, while the administration continued to maintain that lower and middle-income taxpayers would see reductions.
The Senate this week proposed a state and school employee pension plan overhaul that would make these employees pay more for their retirement, and put future employees in a 401(k)ish retirement plan. Leaders there have said without pension reform, they were unwilling to vote on other aspects of the Governor’s budget proposal.
The Senate did pass legislation calling for more transparency in negotiations between the Governor and public sector unions. And of some significance, Senate Appropriations Chairman Pat Browne, of Lehigh County, who was the leading figure in Senate pension reform discussions as well as budget deliberations, crashed his motorcycle and was in intensive care. Browne is now in stable condition and expected back in Harrisburg early in June.
House Majority Leader Dave Reed also promised a pass an on time budget, and, having already passed a liquor privatization bill, the House was setting the stage to vote next week on legislation to reduce property taxes. The proposed plan would raise more money than that suggested by the Governor, but would dedicate the funds to property tax relief. Reed said if the Republican plan couldn’t muster a majority, that he would run the Governor’s plan to see if it could pass. Either way, taxpayers would be looking at increases in sales taxes and state income taxes. If you are curious, the Patriot-News has prepared a slide show comparing the House/Wolf property tax relief proposals, available here.
This week’s major action in the House, which took most of two legislative days, was approval of legislation to reduce the size of the House from 203 representatives to 151 and to reduce the Senate from 50 to 37. This was not entirely a party-line vote, as many rural Representatives bemoaned the increased area and difficulty of connecting with 84,000 constituents, versus the 62,000 each now represents.
If passed by both the House and Senate in two consecutive sessions, The proposal would then go on the ballot for a statewide referendum of the voters.