More Pennsylvania spending votes loom, amid tax debate
HARRISBURG — The Pennsylvania House and Senate returned to the session on the last day of the state’s fiscal year Thursday, with differences remaining over a tax package to finance a $31.5 billion budget plan.
Lawmakers expected to hold more votes on spending legislation, but did not expect to quickly resolve the differences over how to fill a gap of more than $1 billion in the budget package. Closed-door discussions on where to find the money for the state’s deficit-plagued finances could stretch into next week.
House Majority Leader Dave Reed, R-Indiana, said Thursday that Republicans were discussing how to handle changes the Senate made Wednesday to the House-approved spending package. Democratic Gov. Tom Wolf praised the Senate’s budget plan, but his office was noncommittal on whether he would sign the legislation should it win House approval.
The spending plan passed by the Senate calls for a 5 percent increase, or $1.5 billion, and squeezes significant concessions from Wolf. The higher spending is driven primarily by pension obligations, prisons and human services, as well as $200 million in new aid for public school operations and instruction, a 3 percent increase.
One crucial difference between the House and Senate spending plans is the $39 million, a 2.5 percent increase, inserted by the Senate for higher education. The House allocated no new aid for state-subsidized universities and grants for college students.
Meanwhile, Wolf maintains that a House plan to raise $1 billion is inadequate. That plan is based on projected new receipts from higher tobacco taxes, tax delinquents, more legalized gambling and brisker wine and liquor sales.
The House plan also faces difficulty in the Senate. Top senators question the House’s revenue assumptions as overly optimistic, and say support may be lacking for House legislation to expand casino-style gambling to airports, off-track betting parlors and casino-owned websites. The bill would make Pennsylvania the fourth state to authorize internet gambling.
The House also has yet to release the details of a package of increases on the sale of cigarettes and other tobacco products that underpins its $1 billion funding plan.
It was unclear whether the $1 billion could wipe out the long-term deficit that has damaged Pennsylvania’s credit rating. The Legislature’s Independent Fiscal Office projects the deficit will be $1.8 billion in the 2016-17 fiscal year.
The plan also leaves unanswered the question of how the state will pay for what could be billions of dollars in borrowing for school construction costs in the coming years.