Saylor, others pleased with $32.7B budget sent to Senate

Marc Levy
The Associated Press

HARRISBURG — A $32.7 billion spending package for Pennsylvania’s approaching fiscal year began speeding through the state Legislature on Wednesday with little public debate, a stark change from the first three budgets hashed out by Democratic Gov. Tom Wolf and the House and Senate’s huge Republican majorities.

The centerpiece of the no-new-taxes plan unveiled just a day earlier won overwhelming House approval, 188-10. It was negotiated behind closed doors by Republican majority leaders with Wolf and was slated for a Senate vote on Friday.

The effortless movement through the House is a morale-booster for York County delegates.

In a statement Wednesday, state Rep. Stan Saylor, R-Windsor Township, specifically touted the budget for its public education funding and lack of tax increases.

“This is a fiscally responsible budget that keeps spending increases low, and most importantly it does not require any new taxes or fees to balance,” he wrote. “We in the House Republican Caucus have continually invested more money for public education. We also recognize the importance of school choice, and that is why we are adding an additional $25 million for the Educational Improvement Tax Credit.”

Saylor added that he expects the Senate and Wolf to follow suit after the successful passage.

“This is a good budget, and I expect the Senate to pass it and the governor to sign it into law,” Saylor wrote.

Rep. Kristin Phillips-Hill echoed Saylor and said the state budget's movement is a result of House and Senate Republicans' refusal to raise taxes, the federal government's aid in bolstering the state economy and GOP gubernatorial candidate Scott Wagner's "pressure on Gov. Wolf to agree to a fiscally responsible budget."

Phillips-Hill added that she's confident the General Assembly has learned from last year's budget stalemate, which led to the third consecutive budget becoming law without Wolf's signature.

"I have deep concerns about our systematic state financial issues, and I think senators have similar concerns," she said. "I think the Senate wants to get a bill passed, especially after last year's budget when they sent us over an amended budget with tax increases."

The new fiscal year begins July 1.

Quite a change: The lack of a public fight is a reversal from the first three budgets under Wolf, when partisan disagreements over how to plug huge deficits dragged budget acrimony deep into the fiscal year or prompted Wolf to allow spending bills to become law without his signature.

With a November election looming, Wolf — who is running for a second term — had floated a relatively modest budget proposal, and lawmakers were eager to get out of the Capitol.

Sen. Vincent Hughes, D-Philadelphia, said new school funding in the budget package helps reach one of Wolf’s first-term goals, to resolve a deep budget-balancing cut in state aid dealt to public schools and universities in 2011 under then-Republican Gov. Tom Corbett.

“We’re finally closing the hole created by Gov. Corbett and his billion-dollar cut,” said Hughes, the ranking Democrat on the Senate Appropriations Committee.

Still, Hughes said the budget won’t fix long-standing inadequacies in public school funding.

“That’s still a major issue that’s got to get addressed,” Hughes said.

Spending: The plan holds the line on state taxes, and increases spending by about $700 million through the state’s main bank account, or slightly over 2 percent above the current year’s enacted budget of $32 billion.

The increase goes largely to public schools, social services, pensions and prisons. It also creates a $60 million off-budget grant program for school safety that lawmakers say is still being written into legislation to set guidelines for how the money can be distributed and used.

Wolf appeared to get most of the spending he had sought in his February proposal, including more money to expand high-demand computer and industrial skills training in high schools and colleges.

Republicans, meanwhile, rejected Wolf’s overtures for a fourth straight year for a severance tax on Marcellus Shale natural gas drilling and his request for municipalities without a full-time police force to start paying for a portion of the state police coverage they receive.

Details to come: Some details of the budget package remained unclear Wednesday.

The governor’s office and Appropriations Committee officials had not disclosed certain elements of the just-unveiled package, including precisely how the state’s massive Medicaid programs would be funded.

Critics say the use of off-budget dollars to foot Medicaid costs masks the true increase in state spending in the state’s operating account, called the general fund.

“A lot of the growth is off-budget, in what’s called the shadow budget, and it’s not accounted for in the general fund,” said Nathan Benefield of the Harrisburg-based Commonwealth Foundation, a free-market think tank.

The budget package leaves questions for next year.

House officials say the package will tap one-time cash sources to underwrite about $800 million in Medicaid costs, potentially creating a funding gap in a year.

Meanwhile, the state faces rising borrowing costs in the coming years after issuing bonds for school construction projects and backfilling last year’s $2.2 billion deficit, largely by borrowing.

State officials, however, say rosier projections of tax collections in the coming year could pick up those burdens.

— York Dispatch reporter Logan Hullinger contributed to this report.