The PA Budget Battle

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As most Pennsylvania residents, I’m sure, are aware it is that time of year again. The House and Senate are planning on working weekends and evenings to get the elusive budget passed. This yearly debacle is something that residents just expect. There are many facets to this year’s budget. The major issue is that our country is currently in the midst of a recession. Why is this important? It is important because revenues are down and a major cause for the current state budget deficit. As of June 1, the state budget deficit topped $2.8 Billion Dollars. At this time, there have been few budget negotiations within either the House or the Senate. The Republican majority Senate did introduce SB850 which passed the Senate but did not make it out of the House Appropriations Committee. That bill did not increase taxes, but did introduce very serious cuts to existing programs. These programs include education, health, welfare, and public safety. The Democratically controlled House has yet to introduce their budget bill. So where does this leave us, it leaves us with 8 days to pass a budget and little to no real negotiations.

When thinking in terms of the state budget situation one must first realize that it is not an easy task. It has to pass both the House and the Senate and be approved by the Governor. The real challenge to this is that the Senate is Republican controlled and the House is Democratically controlled. This makes negotiations much more difficult. However, I feel that parties should not play a part in this. We all know that the budget is something that must be balanced and passed each and every year. So therefore, discussions and debates should be an ongoing process. Not just one that occurrs every June. It takes a bipartisan approach to work thought the roadblocks that arise during these negotiations. The problem this year is that the current budget deficit is getting worse by the minute. So how would one begin to balance this budget situation since projections were so far off? To start with, cuts are necessary in spending. The Governor is proposing to increase spending so therefore cuts in programs are a necessity. There is no feasible way that this budget can be dealt with without realizing that cuts are necessary. Cuts are always difficult. Many people count on money to fund the important services that our citizens require or enjoy. Those being such things as disability services, education, and public safety. So the next question is how much to cut. The amount to cut is dependent on the depth of the next facet to the negotiations. The other facet to the budget negotiations is a tax increase. No one, including myself, likes the idea of a tax increase but it has to be a part of negotiations to alleviate the severe budget deficit. The two sides need to sit down and realize that no option should be off the table. I just do not see a way around a tax increase in some form or another. I think all other options such as cuts should be the first portion of the negotiations and then legislators should move into tax increases. Looking at the budget deficit, one would have to think that a tax increase would be coming. Governor Rendell has proposed increasing the personal income tax from 3.07% to 3.57%. This would amount to approximately $5.00 a week for someone earning $40,000 per year. So yes it is an increase, but one that could be managed within family budgets. Pennsylvania currently enjoys the second lowest personal income tax in the nation with Illinois being the only lower state and that is at 3.00%. The decisions to be made with respect to cuts to the proposed budget and tax increases are not popular decisions, but ones that need to be made in this tough economy.

When looking at the overall budget picture this year’s budget is difficult. The economic situation as a nation has made it more difficult, but one that can be negotiated with legislators that are willing to conduct themselves in a bipartisan manner. Both parties stand on their own platform, but that platform needs to be negotiable to the benefit of the citizens of Pennsylvania. Let’s all put our personal agendas aside and work together for the common good of the state!

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2 Responses

  1. Increasing the income tax rate seems to be the only major budget relief that has come out of Capitol Hill.
    Most of the programs Mr. Rendell has taken a stand at cutting will have minimal impact to the widening deficit in comparison to revenue that will be generated by tax increases.
    Laying off state employees and freezing pay raises are other highly effective cost cutting measures. Oddly, there are drastic reductions in spending that are not on the table.
    I would be astonished to learn about cuts in governmentment spending by the legislators themselves. It would be refreshing if they would make sacrifices for the good of the state. In lieu of beneficial programs, I propose a cut in their own pay to offset the bonuses given to campaign workers and cronies nominated to high level, cake positions. And maybe scheduling a few more sessions per year would prevent budget impasse procrastination.

  2. Thanks for your comments. A couple of things in response to your posts. You make a good point in reference to scheduling more sessions if the legislature were to stay at it’s current size. It is currently the second largest legislature in the country. I feel that it should be cut down in size. This will make negotiations on things like the budget easier to deal with. It certainly would make getting the votes necessary to get things done much easier.

    There will be cuts to legislature budgets on the upcoming budget. I believe the proposal at it currently stands is for approximately a 4% cut to House appropriations. This will cut down on the funds available to legislators and their staff. So they are facing some cuts. Based on the current negotiations it seems that 4% cut is in line with cuts to other departments as well.

    There certainly is no doubt that increasing taxes is a revenue generator. I do feel that any tax increase needs to be dealt with in a fiscally responsible manner and used as a last resort once all other options have been exhausted.

    -Lee

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