Wolf Delivers Message on School Funding to Business Groups

Gov. Tom Wolf delivered a tough message Tuesday on the need to increase public school funding as he reaches out to business groups, a traditional ally of Republicans, ahead of a budget proposal that is expected to seek higher taxes.

The Democrat, speaking at a suburban Harrisburg hotel, stressed his credentials as a former business owner who understands the hardship of making payroll and how government can affect businesses.

But, with many in the business community bracing for a Wolf proposal to substantially overhaul tax structures, Wolf also told them that public schools must get more money.

"Too many of our kids aren't getting the education they need to excel in the 21st century economy," Wolf said during 15 minutes of remarks at an economic forecasting conference sponsored by the Pennsylvania Chamber of Business and Industry and the Pennsylvania Bankers Association. "We have education that's not good and in some cases that's not relevant. Our schools are underfunded, our kids and our economy have already suffered and the consequences will be even direr in the future if we don't make the investments we need to make."

Wolf acknowledged to about 200 attendees that there will be disagreement over how to increase education funding. Many of his proposals may get no consideration from the Republican-controlled Legislature, but he insisted, "we have to agree that we are going to have to spend some money, we are going to have to make an investment."

Wolf was scheduled to address Lehigh Valley business groups on Wednesday in Bethlehem, where his administration said he would make an "economic development and tax reform" announcement.

Speaking to reporters later, Wolf declined to reveal specifics of the budget plan for the 2015-16 fiscal year beginning July 1 that he will unveil next Tuesday to a joint session of the Legislature.

Thus far, he has said he plans to deal responsibly with a $2-billion-plus structural deficit — the state's operating budget this year is $29 billion — and advance proposals to increase state aid for public schools and make Pennsylvania's tax system fairer.

In addition, he has said that he will seek higher taxes on the natural gas industry that is tapping into the vast Marcellus Shale gas deposit below Pennsylvania.

During last year's gubernatorial campaign, Wolf pledged to increase education spending by $1 billion a year to erase cuts under his predecessor, Republican Tom Corbett.

On taxes, he said he would seek to overhaul Pennsylvania's flat income tax structure to shift a bigger burden to higher earners and then raise it to ease the weight of public school funding currently shouldered by local property tax systems.

He also proposed lowering the corporate net income tax and broadening it to ensure that it captures more revenue from out-of-state businesses.