Gov. Wolf spent $1.8 million for budget consultant

David Weissman
505-5431/@DispatchDavid
  • Wolf's administration paid a consultant $1.8 million for help in closing projected $3 billion budget deficit.
  • Wagner: Wolf blew money "on a no-bid contract with an outside firm to tell him how to do his job."
  • Consultant's 78-page report details about $1.3 billion in deficit-reducing initiatives.

In an effort to find savings ahead of his 2017-18 budget proposal, Gov. Tom Wolf and his administration awarded a $1.8 million contract to a consulting firm for help.

Gov. Tom Wolf answers questions during a news conference at York College's J.D. Brown Center for Entrepreneurship Friday, April 10, 2015. Wolf toured the facility as part of his "Jobs that Pay" tour. Bill Kalina - bkalina@yorkdispatch.com

The firm was paid through the state Office of the Budget's general operating costs, according to J.J. Abbott, a spokesman for Wolf's office. The budget office is operating with just more than $19 million for the 2016-17 fiscal year, according to line-item appropriations.

Abbott said the administration started looking into drastic changes to the budget last year when it became clear how large of a deficit the state would face in 2017-18. The projected budget gap is expected to approach $3 billion through mid-2018 without any changes, according to the head of the state Legislature’s Independent Fiscal Office.

The budget office contracted McKinsey and Company in late November or early December to collaborate on potential cost-reduction and revenue-building efforts, Abbott said.

Wolf proposed his $32.3 billion budget — which includes an estimated $2 billion in spending cuts and $1 billion in tax increases — in early February.

Wolf proposes $2 billion in cuts during budget address

The firm delivered a 78-page report to the office in January, and it includes information on numerous proposals in Wolf's budget plan, including imposing a fee on municipalities without local police coverage and consolidating departments.

The report shows how similar proposals have worked in other states and countries, but it also notes numerous specifics are "beyond the scope of this report," a phrase that appears in some form 12 times throughout the pages.

Criticism: Numerous Republican legislators, including Sen. Scott Wagner, R-Spring Garden Township, have criticized the contract because the state already pays budget office employees for this work.

Wagner, who plans to run for governor in 2018, said in a campaign email statement that Wolf blew $1.8 million "on a no-bid contract with an outside firm to tell him how to do his job."

State Sen. Scott Wagner. Dawn J. Sagert photo

Abbott said McKinsey was selected because of its vast knowledge and experience working with large governments, including 30 states, to address serious structural, financial issues

Steffi Langner, a spokeswoman for McKinsey, said it is her firm's policy not to discuss any of its work with clients.

Jason High, a spokesman for Wagner's office, said he read the report, and it appears the administration spent money for information it already knew.

"It seems like they did a report just to say they did a report," he said. "All it does is attempt to validate what Wolf had already wanted to do anyway."

York CYF anxiously watching state budget negotiations

Abbott said Wolf believes the money was well spent because it's important to have someone from the outside come in with "a fresh set of eyes."

McKinsey's report detailed about $1.3 billion in deficit-reduction initiatives, which Abbott said do not cut services to citizens and were mostly implemented into Wolf's budget proposal.

Randy Albright, secretary of the budget office, could not be reached to answer questions regarding the contract.

— Reach David Weissman at dweissman@yorkdispatch.com or on Twitter at @DispatchDavid.