State budget’s finishing touches remain elusive

HARRISBURG, Pa. (WHTM) – The news isn’t all bad at the Capitol.

“A budget is in place, programs are being funded, bills are being paid,” said House GOP spokesman Steve Miskin.

The budget is almost done, which, of course, means it’s not.

Everyone has agreed to spend just under $32 billion. Miskin says the state can reasonably assume $31.3 billion in revenues. That leaves $700 million in red ink. Combine that with the $1.5 billion deficit in 2016-17 and it means a $2.2 billion hole to fill.

It appears leaders will agree to borrow $1.5 billion against the roughly $300 million a year Pennsylvania gets from a tobacco settlement. Republicans call the borrowing securitization and they say it’s the least bad of their revenue options.

“If you don’t do securitization, you’re doing a personal income tax increase which nobody wants to do,” Senate Majority Leader Jake Corman (R-Centre) said, “so that’s off the table.”

Corman says an extraction tax on gas drillers is also off the table, but he concedes that lawmakers are looking at taxing natural gas users.

“Right now, we pay a gross receipts tax on electricity, so if you heat your home with electricity, you’re paying that tax,” Corman said. “If you heat your home with natural gas, you’re not paying that tax, so there is a question of fairness.”

House Republicans are eyeing numerous pots of money sprinkled throughout state government including the $250 million horse racing development fund.

“There are no sacred cows,” Miskin said. “Our job is not to go back and tax Pennsylvanians. That’s the easy answer. It’s a tough vote, but it’s a very easy answer. The tough decisions are emptying the cupboards before we go to those taxes.”

Finding the funding to finish the job is exactly where the legislature was before I left for vacation 10 days ago.

“It’s like a soap opera, Dennis,” Corman said with a chuckle. “You miss a whole lot and catch up in an hour.”

But the $700 million must come from somewhere and not everyone will be amused when the final deal is done.

“There’s a variety of ways to doing that,” Corman said. “Obviously, none of them are pretty, but we passed a spending plan. We need to pay for it. That’s the responsible thing to do.”

The Senate will not be in session Tuesday, but Corman said he’s optimistic his chamber can pass a revenue package by the end of the week.

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