Wolf blasts new GOP bill in Pa.’s budget fight

Associated Press

HARRISBURG — Democratic Gov. Tom Wolf on Tuesday blasted the latest budget plan to be advanced by Republican lawmakers in Pennsylvania’s eight-month partisan battle that has left billions of dollars in limbo and schools and universities warning of closures.

Pennsylvania Gov. Tom Wolf speaks during a news conference on Tuesday, March 8, 2016. (AP Photo/Matt Rourke)

Wolf said the no-new-taxes plan unveiled by Republicans on Tuesday afternoon is out of balance and leaves a deficit of about $1.6 billion next year by the Republicans’ own calculations.

He declined to say whether he would veto it.

“I’ve been consistent. I want a budget that is balanced, where the math actually works and it invests in the things that Pennsylvania needs to invest in,” Wolf said after an event in the Capitol. “We are looking at a train wreck in 2016-17, a huge deficit if we don’t do something about this.”

Wolf had sought a multibillion-dollar tax increase in this fiscal year to resolve a long-term deficit that has damaged Pennsylvania’s credit rating and to begin wiping out 2011’s budget-balancing funding cuts to public schools.

With the collapse of a bipartisan agreement in December, Wolf is seeking a $2.7 billion tax increase in the fiscal year that begins July 1.

Republicans have not agreed to any sort of tax increase for the next fiscal year, and they insist there is no more rank-and-file support for a tax increase this late in the fiscal year.

They have pressed Wolf to relent and resolve the current year’s budget without a tax increase as public schools borrow more to stay open and Penn State threatens to shut down agricultural extension offices.

“At some point you have to be realistic as to what’s possible and what’s not possible this year,” said House Majority Leader Dave Reed, R-Indiana.

The Senate Appropriations Committee passed a $6 billion spending bill in a party line vote Tuesday to complete a $30 billion budget package. Final floor votes were scheduled Wednesday in the House and Senate to send the bill to Wolf’s desk. It would increase spending from the state’s main bank account by about $870 million, or 3 percent.

However, about $600 million in aid to universities that requires a two-thirds vote of approval remains hung up in the House, where Democrats back Wolf’s opposition to GOP spending plans.

The Republican plan delivers half of the public school aid increase, $200 million, or 3.5 percent, that Wolf had initially sought last year, and the 5 percent increase for state subsidized universities that Wolf had supported.

“Obviously this has been a difficult year, and I think it’s time to get the schools funded, and not only funding them, we’re adding $200 million to the schools, which I think is a pretty significant investment into public education,” said Senate Majority Leader Jake Corman, R-Centre.

Senate Republican officials said it balances primarily by tapping $200 million in reserves, absorbing tens of millions of dollars from the state’s higher education grant agency and projecting more than $150 million in savings in Medicaid programs, partly thanks to higher federal reimbursements under the Medicaid expansion.

A bipartisan deal collapsed just before Christmas after House GOP leaders pulled support. That $30.8 billion spending plan would have required a $1 billion-plus tax increase. Republicans subsequently sent a $30.3 billion plan to Wolf, and he vetoed billions of dollars in subsidies for schools, prisons and hospitals.

On Tuesday, House Minority Leader Frank Dermody, D-Allegheny, insisted a tax increase is necessary to balance this year’s budget, and he criticized the GOP’s plan as built on $280 million in cuts.

“It doesn’t begin to solve the problem,” Dermody said. “This is not a budget that makes any sense whatsoever.”