Pennsylvania Gov. Tom Wolf will propose more than $2 billion in cuts and savings to help wipe out a huge deficit without needing a major tax increase or cutting aid to schools or social services, his office said Monday.
Details of the proposal will be in the Democratic governor’s $32 billion-plus budget plan he was preparing to release Tuesday to a Republican-controlled Legislature that has opposed his efforts in the past two years to fill a stubborn post-recession deficit with a major tax increase on sales or income.
Wolf’s office was not saying Monday how exactly it arrived at the figure of $2.1 billion in cuts and savings. However, Wolf maintained that by cutting “government waste and bureaucracy,” he could put more money into public schools, a cornerstone of his administration, and prevent cuts to social services without a broad-based tax increase.
However, Wolf will need more money to meet his goals and address what budget analysts are projecting to be a roughly $3 billion budget gap in this year and next year combined, the difference between projected tax collections and the cost to maintain current programs.
On that front, Wolf is expected to ask lawmakers to impose a Marcellus Shale natural gas extraction tax, something they have opposed for nearly a decade, and to restructure the corporate net income tax to remove loopholes the administration says allow some profits to go untaxed. Wolf already has made that proposal, only to see it blocked by staunch opposition from Republicans and the Pennsylvania Chamber of Business and Industry.
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Groups that depend on state aid will be watching closely. School groups say district budgets are suffering as the cost of pension obligations, health insurance, special education and charter school tuition outpaces new state aid. Nearly 4,000 adults with an intellectual disability or autism are on a waiting list for immediate caregiving help as the state still has yet to fully fund services for the roughly 55,000 people receiving those services, according to the Arc of Pennsylvania.
“We’ve been told that this is a concern that the governor shares, so I’m cautiously optimistic,” said Maureen Cronin, the executive director of the Arc of Pennsylvania.
County governments have pressed Wolf and legislative leaders for more aid. They have felt squeezed by the state for more than a decade into footing a larger share of the cost to handle abused and neglected children and services for the addicted, mentally ill and intellectually disabled.
“Pretty much everybody was saying that their intent was not to harm our appropriations, but I don’t really know how that translates” into actual dollars, said Douglas Hill, executive director of the County Commissioners Association of Pennsylvania.
In the meantime, budget pressure is growing from the same, and new, directions.
Wolf has made several moves in the past six weeks to try to squeeze out savings. He ordered the closure of the state prison in Pittsburgh, eliminated positions in state government and wants to consolidate four state public agencies into one.
Senate Minority Leader Jay Costa, D-Allegheny, said he also expects Wolf’s administration to recapture economic development dollars from entities that did not meet their obligations to hire workers.
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