Independent Fiscal Office identifies revenue shortfalls

The Independent Fiscal Office is projecting at $569 million shortage for fiscal year 2013-14 and $778 million for the following fiscal year. 

The IFO highlighted several factors, including lagging sales tax and personal income tax withholding collections, along with a decline in personal income and sluggish wage and salary increases. 

The IFO says 2013 was a weak year.

“Clearly there was an overprediction of revenue…the economy was weaker than expected,” said IFO Director Matthew Knittel. “Going forward we are optimistic because we think there were temporary factors causing the shortage and going forward things will improve.”

Governor Tom Corbett’s office says tough decisions need to be made in the weeks ahead and the lower revenues will have to be factored into the discussions.  Democratic State Senator Vincent Hughes is urging lawmakers to pass several measures to help balance the budget including a tax on Marcellus Shale drilling.

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