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Pa. House votes down latest Wolf tax plan
Gov. Tom Wolf's hopes of ending Pennsylvania's 99-day-old state budget impasse were dashed Wednesday when nine of his fellow Democrats joined all House Republicans to vote against his revised plan to raise billions in income and gas drilling taxes.
The House voted 127-73 against Wolf's plan to increase the state's personal income tax rate by a half percentage point and create a new extraction tax on Marcellus Shale natural gas production.
"Seventy-three is 29 votes short of what the governor needed," said Rep. Kristin Phillips-Hill, R-York Township. "The numbers just don't add up."
Democrats needed more than a dozen Republican votes but were unable to keep on board some moderate members of their own caucus from western Pennsylvania.
Wolf, a Mount Wolf native, told reporters he was encouraged that so many Democrats voted yes.
"There is a bipartisan recognition that we have a big problem in Pennsylvania," Wolf said.
Proposal: Wolf proposed the tax package on Tuesday, after Republican leaders who control both chambers of the Legislature offered him a floor vote to demonstrate whether there was support for his approach.
"It is time to get about the business of getting this done," said Majority Leader Dave Reed, R-Indiana, at the close of six hours of debate. "It's time to take ideas and formulate them and put them together and build a better future."
Wolf and his Democratic allies want new revenues to plug a billion-dollar-plus structural deficit and to send more money to schools and for human services. But Republicans argued the income tax increase would be borne mostly by working families and warned the gas tax, on top of an existing impact fee, could damage the industry.
"There is a very big deficit we need to take care of," said Rep. Kevin Schreiber, D-York City. "We do need the revenue."
Changes: Wolf's goal had been to raise $1.4 billion for the current fiscal year and $2.4 billion next year. The approach that was defeated on Wednesday was considerably less costly than the budget Wolf outlined in March, and it did not include a previous proposal to increase the sales tax and apply it to more items.
The latest proposal also didn't include sweeping property tax relief that the Wolf administration said would save an average family of four 13 percent off their tax burden.
"He completely abandoned broad-based property tax relief. He literally walked away from it," said Rep. Seth Grove, R-Dover Township,
Phillips-Hill said she was never a fan of Wolf's tax relief plan since once-proposed tax increases weren't fully directed to property tax relief.
"It needs to be a dollar for dollar reduction," she said.
The amendment's defeat was just the most recent in a series of partisan votes and Wolf vetoes as the state's politically divided policymakers have struggled to find common ground on a spending plan for the fiscal year that began July 1. Illinois is the only other state without a budget in place.
Impact: Grove said lower-income residents would see natural gas become more costly while working families would be hit with a 16 percent income tax hike.
"Let's roll up our sleeves, find ways, smart ways, to balance our budget without putting the burden on middle class and low-income Pennsylvanians," Grove said.
Some lawmakers argued that public pension cuts should be part of the plan, and after the vote, Reed said a next step will be to work on savings in the pension systems, selling the state-owned liquor stores and expanding gambling. He did not rule out a gas drilling tax but said it would not be at the level Wolf wanted.
Rep. Gene DiGirolamo, a moderate Republican from Bucks County, urged his colleagues to cooperate with one another.
"If you're the governor, if you're a state senator, people elect us to work together to get things done and to solve problems," he said. "And they expect us to solve problems and they expect us to get this budget done."
Wolf called the vote a "tough political act" that could speed up the process.
"I think the Democrats showed their stuff today," Wolf said. "I was really proud of them."
Staff writer Greg Gross contributed to this report. Reach him at email@example.com.