Corbett budget: No tax hikes, higher-ed cuts
Pennsylvania Governor Tom Corbett addresses members of the media during a press conference following the regularly scheduled Penn State Board of Trustees meeting in State College, Pa., Friday, Jan. 20, 2012. Penn State President Rodney Erickson used the meeting as an opportunity to address the perception that the university isn't being as open and honest as it could be in the wake of the Jerry Sandusky scandal. (AP Photo/Andy Colwell)
Posted: Tuesday, February 7, 2012 2:00 pm | Updated: 5:05 pm, Tue Feb 7, 2012.
HARRISBURG, Pa. (AP) - Gov. Tom Corbett on Tuesday proposed a hold-the-line budget of $27.1 billion, with no tax increases and deep cuts to higher education assistance.
Corbett's proposal for the 2012-13 fiscal year that begins July 1 comes as his administration grapples with lackluster tax collections and higher costs for debt, health care and pensions. Cuts would be widespread across state agencies.
In his address to lawmakers, Corbett called his budget "lean and demanding."
"It is a budget that proposes more in the way of reforms by continuing to change the culture of government from one of entitlement to one of enterprise," he added. "These tough decisions will lay the groundwork for the prosperity of tomorrow."
Dozens of demonstrators wearing black shirts that read "Gov. Corbett, Whose side are you on? Stand with the 99 percent" roamed through the Capitol during Corbett's speech.
Perhaps the most glaring cuts are a proposed reduction of about $230 million, or 25 percent, for the State System of Higher Education, Penn State University, University of Pittsburgh and Temple University, a year after cutting the schools by almost 20 percent. Community colleges would see a 4 percent cut and grants through the Pennsylvania Higher Education Assistance Agency would see a 6 percent cut.
Public schools, which had to absorb about $860 million in spending cuts this year, would see their basic subsidies rise about $45 million to $5.4 billion, but would lose $100 million in grants that helped fund full-day kindergarten and other programs. In his proposal, Corbett would fold the public school aid with subsidies for transportation and other costs into a proposed new block grant that would give school boards more control over how the money is spent.
He also would institute hundreds of millions of dollars in cost-saving measures to offset a rising tab for services for the poor, elderly and disabled and keep the Department of Public Welfare budget roughly level at $10.5 billion.
Among them is a plan to save $319 million by eliminating cash payments for about 60,000 participants in the General Assistance program for people who do not qualify for federally funded welfare. It also would impose new eligibility rules, including minimum work requirements, for about 30,000 recipients who receive Medicaid benefits, administration officials said.
Corbett said his aim was to "right-size" the state welfare system. He said his proposal would "give incentives to those who are able to transition from the welfare line to the employment line while it gives real relief to our poor."
For businesses, Corbett would continue the phase-out of an asset tax that businesses pay, reducing expected collections by about $250 million next year.
The Republican governor and GOP-controlled Legislature this year enacted a $27.1 billion budget that reduced spending by about 3 percent. However, tax collections are lagging and Corbett's budget chief, Charles Zogby, said the current budget is expected to end in June with a $719 million shortfall.
While revenue is expected to increase in 2012-13 by more than $1 billion, much of it will be consumed by fixed increases in pension and debt costs.
Corbett's budget did not address the growing problem of the state's deteriorating highways and bridges, but he promised to work on a solution in the months ahead.
8 comments:
I planned to go to law school after I graduated, but it looks like my folks won't have enough money to put me through college.
Judge Smails: Well, the world needs ditch diggers, too.
Can we send the Governor and the Legislature to ditch digger school and get them out of Harrisburgh?
Judge Smails: You know, you should play with Dr. Beeper and myself. I mean, he's been club champion for three years running and I'm no slouch myself.
Ty Webb: Don't sell yourself short Judge, you're a tremendous slouch.
Painful cuts: Education takes the brunt -- again
February 9, 2012
Careful spending hurts. We all know that from personal experience, as hard times have forced us to eliminate frills and cut back on staples.
Thus, Gov. Corbett’s budget proposal for the 2012-13 fiscal year, delivered to the Legislature this week, has been met with howls of pain. None louder than from our state universities — Temple, Pitt and Penn State. Combined, they’re looking at a 25 percent reduction in state funding a year after absorbing a 20 percent cut. If you’re counting, the universities would be out a combined $230 million.
The natural reaction is that the governor is killing higher education and also students’ parents who likely will have to make up the difference by paying higher tuition bills. This, at a time when families already are struggling to make ends meet. Are we reaching the point where the only way for many students to afford college is to go to school in another state?
There may be some truth to that. But it’s also true that our universities are top heavy with administrators and overburdened with big-time administrative salaries. Consider that in 2010 the presidents of Penn State, Temple and Pitt were earning $620,000, $527,00 and $460,000 respectively, with total annual compensation packages worth $800,000, $602,000 and $600,000. Those salaries might not measure up to the private sector for like-sized organizations and similar responsibilities, but they are among the top salaries for public universities nationally.
No doubt the labyrinth of administrators helping the presidents micromanage the universities likewise receive generous salaries and benefits. Rather than trickling down funding cuts to education programs and ratcheting up tuition, we urge the presidents and ALL their administrators to volunteer for a 10 percent salary cut. We’re not sure how much of a dent that would put in the universities’ $230 million funding loss, but we have little doubt that it would significantly lighten some very fat payrolls.
A proposed 4 percent cut in state funding for community colleges is much more difficult to accommodate, as these comparatively lean operations have little fat to trim. And significantly hiking tuition at colleges established as affordable alternatives for working-class families seems counterproductive. Lawmakers ought to fight the governor on this one.
They also should not give up the fight for a tax on natural gas drillers somewhere in the area of 5 percent, the national average. It is a huge source of revenue the governor refuses to pursue — perhaps as a payback to the drilling companies that contributed heavily to his campaign fund. Instead, Gov. Corbett has proposed a county-imposed impact fee of 1-2 percent. Alarmingly, Republican lawmakers are now rushing to pass such a measure with little time for public scrutiny.
Lawmakers favoring a tax should say no to what’s looking like a backroom deal, and, instead, craft a tax that is commensurate with other states. Our revenue-starved commonwealth, which could be facing a $719 million budget shortfall by the end of the fiscal year, needs every penny it can get. The governor’s very lean budget makes that clear.
On the plus side, public schools, which sustained $860 million in funding cuts last year, will receive a $45 million hike in basic subsidies. At the same time, they’ll lose $100 million in grants that many districts use to help fund kindergarten and other programs. Some believe early childhood education produces a payback in later years by limiting the dropout rate and its consequential societal drag. Others argue that the benefits wear off and so the investment of tax dollars is largely wasted.
Who knows? Maybe it is, maybe it isn’t. What we do know is that you can’t spend money you don’t have. So let’s not clamor for the state to spend tax money on non-essentials.
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Falling into that category are the shamefully costly benefits state lawmakers shower on themselves. Cadillac health care, gluttonous pensions, thoughtless over-staffing and a host of loose or non-existent rules on expenses and other perks allow legislators to plunder the treasury in a way that would land regular people in jail. Lawmakers need to set a good example by imposing spending cuts on themselves. They are nothing but hypocrites if they whine about the governor’s budget while selfishly busting the budget in their own interest.
That said, the governor deserves criticism for skirting some pretty important issues: the looming public pension tsunami and what to do to fix the problem; health insurance costs; and the state’s rotting infrastructure are but a few. The governor also wants to cut business taxes. But are corporations paying their fair share?
And whatever happened to all that gambling money? Where is all the revenue going?
The budget does hold the line on taxes — at the expense of a lot of programs to help the state’s neediest folks. If this is living within our means, then everyone has to lower his or her expectations about what government should do.
Bottom line: This budget and what it will do to Pennsylvania is one more reason why every voter should take an interest in this year’s legislative elections.
From the makers of "Too Big to Fail" comes two amazing new products, "Too Expensive to Pay For" and "Too Vast to Deal With". Article from yesterday's Phila. Inquirer.
Corbett says road, bridge, and transit problems too big for Pa. budget
February 09, 2012|By Paul Nussbaum, Inquirer Staff Writer
Is transportation too expensive to pay for?
Gov. Corbett said Tuesday that he did not budget for rescuing troubled highways, bridges, and mass-transit systems because the problem is so vast.
Corbett's own transportation funding advisory commission urged last August that the state increase motor vehicle registration and license fees and raise a component of the gasoline tax to produce $2.5 billion more a year for highways, bridges, and mass transit.
Pennsylvania has more structurally deficient bridges than any other state - more than 5,000.
But Corbett reduced transportation funding by about 9 percent in the budget he proposed Tuesday: $5.86 billion, down from $6.43 billion this year.
"It is critical that we address our transportation issues," Corbett said in his budget address. "This is not a budget item. It is too large for that.
"Transportation must be confronted as its own distinct and separate topic."
He did not say what solutions he favored to pay to rebuild the state's crumbling bridges and highways and transit properties.
"There is less money to work with," said PennDot spokesman Dennis Buterbaugh. "We're not going to let a bridge fall down or be unsafe . . . but we will have to shift more money from paving and expansion to maintain bridges."
The cuts in transportation also mean less funding for mass transit.
SEPTA will get about $300 million for its capital budget to pay for such things as new vehicles and station improvements. That is the same as this year and down 25 percent from three years ago.
SEPTA will once again put off construction projects for lack of money.
"Funding constraints are threatening SEPTA's ability to serve its growing customer base," SEPTA said in a statement Tuesday. "More than $600 million in critical upgrades, from bridge repairs to overhauls of aging electrical substations and renovations of outdated facilities . . . have been deferred indefinitely."
SEPTA's daily operating subsidy from the state will remain about the same, so the agency will not face service cuts or fare hikes in the next year, with an infusion of cash from its rainy-day fund.
But that "service stabilization fund" will then be tapped out, and SEPTA faces an operating deficit of about $50 million in the fiscal year that starts July 1, 2013.
That could again raise the specter of service cuts. A fare increase is already anticipated for that year.
Was thinking maybe we could put up a nice positive post....Like......
HOW ABOUT THOSE LADY BULLDOGS!!!!
Great job last night girls!
Absolutely, Donna. GREAT JOB, LADY BULLDOGS!
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