Pa. Lawmakers Buckle Down on State Budget

Strengthening Pa. revenues could ease budget cuts

State lawmakers are returning to Harrisburg on Monday after three weeks away for Easter and the primary elections and probably will spend much of the coming weeks deciding how to lessen Gov. Tom Corbett's proposed spending cuts.

Monday kicked off the final two months of the spring legislative session and the state's fiscal year. The state's tax collections in April were above the amount projected by Corbett and could help state government exceed the deficit projection in his overall budget plan by several hundred million dollars, legislative staff said.

But there is a long line of proposed cuts that will demand lawmakers' attention.

For instance, advocates for the poor are protesting cuts that the state expects to tally about $320 million by eliminating about $200 a month for temporarily unemployed and disabled adults and by requiring them to work 100 hours a month to maintain a state-paid medical benefit.

Michael Froelich, a staff lawyer for Community Legal Services in Philadelphia, said eliminating the temporary cash assistance will ensure more people end up in homeless shelters, which are also slated to get a big cut in state aid. He said it makes little sense to require these same disabled people to work 100 hours a month to maintain their medical benefit.

“Hopefully we can educate legislators about this so they can see you can't just overnight eliminate (the only source of income for) somebody who is unable to work ... and expect that you won't see them turning to more expensive social services,” Froelich said.

Schools, social services and nursing homes are also in line for cuts under Corbett's proposed budget.

Counties, which administer a wide range of social services from care for the mentally ill to the homeless to neglected and abused children, would have to do so with 20 percent, or $168 million, less.

Public schools would lose a $100 million grant program, while Penn State, Temple, Pitt and Pennsylvania's 14 State System of Higher Education universities would lose 25 percent, or $230 million.

Nursing homes that treat the poor are fighting a cut of 4 percent, or $46 million, which actually would reach $102 million when the loss of federal Medicaid matching funds is included, an industry lobbying association said.

In February, Corbett proposed a hold-the-line budget of $27.1 billion for the fiscal year beginning July 1 that also dealt with a newly projected $719 million shortfall expected in the current fiscal year.

While the governor had expected tax collections to increase in 2012-13 by more than $1 billion, much of it will be consumed by fixed increases in pension, health care and debt costs. In addition, his budget proposes drawing several hundred millions dollars from outside funds to prop up the state's main bank account.

Corbett, who pledged in his campaign not to increase taxes, is not seeking any major tax increase, and his proposed budget would cut $275 million in taxes paid by businesses.

On Tuesday, the Legislature's newly created Independent Fiscal Office was scheduled to release its estimates of revenue collections for the next 14 months.

The office is headed by former U.S. Treasury Department economist Matthew Knittel. It was designed to help legislators set sound fiscal policy and will parallel the mission of Washington’s Congressional budget office, as a balance for the Corbett administrations Budget Office.

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