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Grim new forecast sees nearly $3B budget gap in Pennsylvania

MARC LEVY, Associated Press

HARRISBURG — Pennsylvania’s grim state budget forecast is getting gloomier.

FILE - In this Oct. 5, 2016 file photo, Pennsylvania Gov. Tom Wolf speaks during the White House Rural Forum in Heritage Hall at Penn State's HUB-Robeson Center, in State College, Pa. (Abby Drey/Centre Daily Times via AP, File)

The head of the state Legislature’s Independent Fiscal Office said Thursday that revenue collections are even weaker than expected last fall. Matthew Knittel says year-over-year revenue collections are flat amid weak corporate profits.

That means that, without any changes, the projected budget gap is approaching $3 billion through mid-2018. The state’s approved budget is $31.5 billion this fiscal year.

The Republican-controlled Legislature’s rebuffed Gov. Tom Wolf’s efforts the past two years to balance the deficit with a broad tax increase. Now the Democratic governor says he’ll produce a budget-balancing plan next month that relies heavily on cuts and savings measures.

Spending is being pushed up by the rising cost of health care, prisons and overdue pension obligation payments.

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