The guidelines, which were issued two weeks ago but just made public this week, call for spending cuts and business tax cuts. Although there was a nearly $800 million surplus last year, and the word sent out to the various state government departments is that the newly enacted budget under-estimates revenues again this year, the agencies have been instructed that general operations and administrative funding levels for next year must be no higher than they are for this year.

However, a 1.6% increase in pay for state employees, and a $200 million increase in state contributions to employee pensions have already been approved for 2012-1013, and those hikes have to be included in the level funding proposals for next year.  

In addition to basic operation and administrative costs, departments have been instructed to keep requests for discretionary programs equal to or less than amounts for this year, and the guidelines make clear that no request can be made for state funding to replace any lost or reduced federal funding. A goal that the Governor campaigned on last year, that of reducing state spending by 10% in four years, remains in place.

Accompanying the budget cuts is a proposal to reduce taxes on businesses by approximately $400 million. Most of that, $300 million, would come from a continuing phase-out of the Corporate Stock and Franchise Tax. An additional $100 million would be lost from revenue by reducing the Corporate Net Income Tax by 0.5%.

The Governor’s budget address to the legislature is likely to happen during the week of February 6 next year.

State Government Committee Talks About Shrinking the Size of the Legislature

Posted on August 10 at 11:20 AM

Yesterday afternoon, the House State Government Committee held a hearing to disucss various bills that have been introduced to reduce the number of legislators in the General Assembly.  Pennsylvania has the second-largest legislature in the country, and among full-time legislatures we rank second.  There are currently 203 House members and 50 senators.

Several bills have been introduced this session to cut that number by varying amounts. Foremost among these proposals is House Bill 153, introduced by the Speaker of the House, Rep. Sam Smith (R - Jefferson).  That bill would reduce the House to 150 members beginning with the 2022 election after the 2020 census and reapportionment.  Another typical bill is House Bill 55, introduced by Rep.Mark Mustio (R - Allegheny).   That bill reduces the House to 185 and the Senate to 37, while extending House members' terms from two years to four, and Senators' terms from four years to six.

Arguments  put forth by the proponents of the shrinkage plans included cost savings to be derived from having fewer legislators, to making the chambers more effective in its operations and deliberations.  They said that due to new developments in communciations, it would still be feasible for legislators to be easily accessible to their constituents.

In addition to the bill sponsors touting the virtues oftheir bills, the Committee heard testimony about how we got to the current numbers of 203 and 50.  Prof. Richardson Dilworth from Drexel University testified that it was a Constitutional Convention in 1874 that doubled the number for the House, and increased the number for the Senate by 50%.  The rationale for that, he said, was to allow for better representation of constituents by having fewer in each district, and to reduce the cost of election campaigns thereby reducing the dependence of legislators on lobbyists to provide funding. 

Opponents to the prososalsused the same arguments in yesterday's hearing.  Rep. Mark Cohen (D - Philadelphia) said that both of those concerns would become even bigger problems than they are already today if the number of legislators were reduced.  He also said that cutting 50 legislators would reduce the state budget by less than one-half of one percent, a savings that could not justify the reduced representation and increased influence of private campaign contributions that would follow.

The Committee took no action following the hearing, and as of this date, no further meetings have been scheduled.

House Committee Holds Hearings on School Choice

Posted on August 4 at 2:25 PM

The House Education Committee has completed two days of hearings in the State Capitol on the topic of school choice.  The hearings were run by Committee Chairman Rep. Paul Clymer (R-Bucks) and were part of a series of seven hearings to be held across the state this summer as the House gets ready to potentially tackle the thorny subject of choice this fall.

The lead witness, and the one drawing the most attention, was Secretary of Education Ronald Tomalis.  He addressed all three of the major components of the choice battle, publicly-funded vouchers for public school students to attend private schools, expansion of the charter school system, and  increasing funding for the state's Education Improvement Tax Credit program (EITC).

On the subject of vouchers, Sec. Tomalis said that the Corbett administration would like to see a bill that would provide vouchers to students who attend, or live in the service area of, a school that ranks in the bottom 5% of all public schools in Pennsylvania (144 in number).  The voucher would enable the students to attend a different public school or to enroll in a private school.  The amount of the voucher would be equal to the per student appropriation that the state provides to a student's home school district.

With regard to the EITC program, Sec. Tomalis expressed strong support for it, but was cautious about rapid and large increases in the amount of money earmarked for the tax credits.  Legislation has already passed the House that would raise EITC from the current $75 million to $200 million in just two years.

Following his comments, the Secretary was asked a number of questions, some of which were very pointed and direct.  In response to some of them he said that he saw no problem with spending state money to send a student to a school where many or even mlst of the teachers are not certified as is required in the public schools.  He also insisted that there must be accountability in the voucher program, so any student who receves a voucher must take the same achievement tests as he or she would if still in the public school system.

The Senate has a voucher bill, Senate Bill 1, ready for action when the legislature returns from summer recess in September.  A House bill, House Bill 1330, increasing the EITC funding, has already passed the House and is in the Senate.  Various charter school bills can be found in both chambers.

The hearings will continue through most of the rest of August.