Committee Reports Taxpayer Protection Act

Panel also endorses tax breaks for emergency personnel

The Senate Finance Committee today reported out the Taxpayer Protection Act bill and Constitutional Amendment, as well as a pair of bills that would provide income tax breaks for volunteer firefighters and EMS personnel, according to Committee Chairman Senator Pat Browne.

The Finance Committee, by a vote of 6 to 2, reported out both of the Taxpayer Protection Act measures, Senate Bill 7 and Senate Bill 707.

SB 7, sponsored by Senator Bob Regola, is a Joint Resolution providing for an amendment to the Pennsylvania State Constitution that would limit state spending to the average inflation rate plus the average percentage change in state population over the three preceding years.

SB 707, a measure introduced by Senator Mike Folmer, would provide the same limitation, but not as a Constitutional Amendment. SB 707 could be enacted this year, while the Constitutional Amendment proposed in SB 7 must be approved by the Legislature in two successive sessions and be approved by the voters as well.

Speaking at the Committee meeting, Senate President Pro Tempore Joseph Scarnati said Pennsylvania state government needs the spending restraints provided by the Taxpayer Protection Act.

"It is all about spending. This budget is about spending. The next budget is about spending. We can't sustain the spending increases and that's what is killing us and it's a sad commentary, very sad commentary, when we have to pass legislation to slap ourselves," said Senator Scarnati. "I am going to tell you something, it is well needed and it has to be done.

"We have to set the legislation in stone that we're not going to exceed these spending limits, otherwise what ever else we do doesn't matter," Senator Scarnati continued. "This is the cornerstone that we need to lay today. I support it and I believe we are on the way to a better government in Pennsylvania if we get it done."

Prior to the Committee's passage of the bills, both measures were amended with a provision offered by Senator John Eichelberger stating that the spending limit would be decreased commensurate with any funding cuts to a mandated service.

In addition to the spending limits in the Taxpayer Protection Act, the proposal also sets realistic restrictions on the use of any unanticipated revenues received by the Commonwealth.

Specifically, 75 percent of any revenues exceeding the spending limits imposed by the bill would be returned to the taxpayers. The remaining 25 percent would go directly into the Rainy Day Fund to help the Commonwealth cope with unanticipated revenue shortfalls.

"The Taxpayer Protection Act would provide reasonable guidelines that would make state government follow the basic principle of keeping spending in line with revenues -- and as a reflection of the economic climate in the Commonwealth," Senator Browne said.

The Committee also approved Senate Bill 23, sponsored by Senator Michael O'Pake, which would authorize a $250 tax credit for volunteer firefighters and emergency medical services (EMS) personnel to apply toward their state income tax.

"This bill is part of the Legislature's continuing efforts to support Pennsylvania's volunteer fire departments and ambulance corps," Senator Browne said. "It takes a tremendous commitment on the part of these volunteers and this tax credit, if enacted, would be a tangible way of showing our appreciation for their service to our communities."

In addition to the Senate Bills, the Committee reported House Bill 876, legislation by state Representative Dwight Evans to extend the current 4 percent employer contribution rate in the State Employees' Retirement Code.

Contact:

Stacey Connors
Committee Executive Director
(717) 787-1349