Gov. Tom Wolf will stand at a lectern today and deliver his ideas for how this state can make and spend funds over the next year in an address that’s historically more an act of theater than anything else. Meanwhile, next steps will still need to be taken on the budget from last year that — 224 days after it was due — still has not been approved by lawmakers.
What those next steps are? For that, there is an almost stunning lack of certainty.
“It is uncharted territory, so it’s a little hard to lay out a road map,” said Chris Borick, an associate professor of political science at Muhlenberg College in Allentown. “We’re looking at, in essence, the fusion of parts of one budget cycle with another. And there are no easy answers for how that gets resolved.”
Never in modern Pennsylvania history has a governor delivered a budget proposal address before the budget from the prior year was wrapped up. This state’s leaders have a few options: Will lawmakers make a Band-aid budget that doesn’t do much of anything and send 2015-16 away for good? Will they roll the money from last year into a bigger deal for the coming year? Could they just scrap the whole thing altogether and start anew?
Much of that could depend on today and the rhetoric Wolf uses to describe how he’ll work with the Republican-controlled legislature over the next year. Here’s what to expect and what may happen next:
Major points of the budget proposal
Little information has leaked out of the governor’s office regarding where a cash flow will come from as the state still stares down a nearly $2 billion deficit and faces an impending crisis over paying out pensions. It’s widely thought that Wolf will likely propose an increase in the sales tax (a deal that almost worked last year), the personal income tax or both.
What we do know about how Wolf plans to bring in money is that he will likely propose, once again, a natural gas extraction tax that would tax gas companies and do what Wolf campaigned on them doing: “Pay their fair share.” He pulled his support of the extraction tax off the table during negotiations over the past year, but has made it clear he’ll bring it up again.
Here’s what else we can expect Wolf to propose during today’s budget address:
1. Education: While the budget that Wolf line-item vetoed in December provided some $100 million in basic education funding, he still blue-lined another $3 billion in funds as he wanted the legislature to approve what he wanted to restore cuts made under former Gov. Tom Corbett’s administration: $377 million in basic education funding. So in addition to that hope, Wolf will today propose another $200 million increase in basic education funding — a number that apparently still falls short of what education advocates say the public school system needs to function properly.
“The $200 million increase proposed by the governor for next year does not keep us on track toward the long-term goal,” Charlie Lyons, spokesman for the Campaign for Fair Education Funding, told Newsworks. “We urge the governor and legislature to increase that amount when enacting a final budget for the next fiscal year.”
2. He’ll also ask for $60 million to support early childhood education programs in addition to the $30 million he wanted in the last budget to go toward pre-K and Head Start.
3. The governor also announced this week that he plans to propose ideas for streamlining government departments, specifically combining the Board of Parole and Probation with the Department of Corrections. Wolf proposed this move last year but it stalled in the legislature.
Wolf’s spokesman Jeff Sheridan has also said that, moving forward, the governor will continue to push for the legislature to pass a medical marijuana legalization bill as well as an increase in the statewide minimum wage to $10.10 an hour.
“There are reasonable members in both Republican caucuses and there are a lot of people who want to get things done,” Sheridan told Billy Penn in January. “But the question is whether extreme right wing members are going to continue to hold things up.”
Meanwhile, some Republicans have publicly lambasted Wolf for his role in the budget impasse. He vetoed a budget the Republican legislature passed last summer and line-item vetoed one that he called “garbage” that was sent to his desk shortly after Christmas. A Senate panel was held Monday and lawmakers reportedly “grilled” the treasury department for releasing some state funding without approval from the legislature.
“We have a constitutional crisis on our hands,” Rep. Cris Dush, R-Jefferson County, told The Pittsburgh Tribune-Review after the hearing. “There is no way for a governor to do this on his own.”
What happens to the old budget?
This is where things get a little tricky. No one seems to know where to go from here — Jay Costa, a Senate Democrat and a leader of the party, told PCN this week he doesn’t know how lawmakers may move forward. Few top officials have outlined next steps in dealing with the floundering 2015-16 budget.
A budget framework was agreed to in November by Wolf and leaders of the Republican and Democratic Senate caucuses as well as the Democrats in the House. But House Republicans — largely rank-and-file members who had run on the premise of not raising taxes — fought against it. Just before Christmastime, it seemed a miracle was in order and a budget plan might pass, but it crumbled and the House went home for the holidays, having torpedoed the compromise.
There are a few schools of thought as to how the state legislature can move forward:
1. Create a Band-aid budget and send 2015-16 packing for good. Borick said there’s still time for Wolf and the lawmakers to figure out a spending plan to release funds to state-funded programs and departments that need it. It may not have widespread change — pension reform, liquor privatization, a huge boost in education funding — that some legislators want and campaigned on, but it could be a way to simply release the remaining cash in an incremental way.
2. Roll what’s left of 2015-16 into the coming budget. State. Sen. Ryan Aument, R-Landisville, told Lancaster Newspapers that some conversations have taken place about signing onto an 18-month plan that would the state government for what’s left of the 2015-16 cycle and then also funds it for the coming year. That would require lawmakers agree to a year-and-a-half of what could include tax increases to cover the rising deficit.
“The challenge frankly is for the governor to come back to the table and negotiate from a position of reality in my mind,” Aument said. “He still continues to talk about the $30.8 billion framework. Well that framework has collapsed and he has indicated since that time that it has clearly collapsed.”
3. Could they just let the 2015-16 budget go and start from scratch? That might be more of a question of what might happen than what lawmakers are planning on happening. But with money released to schools and nonprofits that could last through April or May, the question can be asked: What’s stopping lawmakers from just saying “screw this” to 2015-16 and starting anew, passing a new budget on time by the end of June?
“Without some resolution,” Borick said, “I don’t know if anybody really knows.”