State Must Address Budget Challenges

A Column by State Senator Pat Browne
16th Senatorial District

As we open a new Legislative Session with a new Governor and a new Legislature in Harrisburg, one issue remains at the top of our agenda – crafting a fiscally responsible budget that holds the line on spending and includes no new taxes.

There’s no arguing that times are tough for Pennsylvania workers, for local governments and for those who rely on state programs and services. So, we need to make tough choices.

A recent Quinnipiac University survey found that over 90 percent of those polled said the state budget is a “serious” problem. More than half of those polled want state government to cut services before raising taxes. State government must take that message to heart in the coming months as we work to craft a state budget.

The recent mid-fiscal year budget report indicated that revenues are coming in on target. This is a promising sign after many straight months of deficits. State revenue growth is slowly picking up as far as corporate taxes and sales taxes are concerned. Cost-cutting measures have yielded savings.

But that does not mean our state’s budget challenges are nearing an end. Pennsylvania will lose $2.6 billion in federal stimulus aid and another $750 million in one-time revenue transfers from other special state funds in the upcoming fiscal year.

So, while we are seeing a slight pickup in state revenues, we still have a huge hole to fill. The state must address the increased costs for medical assistance to low-income families and senior citizens, as well as higher costs for public pensions and prison operations.

We have made good strides in reducing some of these burdens, especially in the area of pension reform. Last year, we passed and signed into law a pension bill designed to provide $3 billion in savings to Pennsylvania’s public pensions, while addressing an impending spike in costs for those plans. Through these changes, we can stabilize Pennsylvania’s public pension systems while addressing the projected substantial increases in premium costs and ease the burden that is facing local taxpayers.

Also included in that legislation was language to establish an Independent Fiscal Office. This office will fundamentally reform Pennsylvania’s budgeting process while monitoring spending and increasing accountability in state government. The Independent Fiscal Office is a non-partisan agency with representatives from both the House and Senate and its members will have expertise in financial matters.

As we look to tackle this year’s budget, we must look at every program and department line by line to see where we can reduce costs or increase efficiencies. We must determine which programs or services are achieving their intended goals and which are not. Those programs that are reaching or exceeding their goals need to be continued, while those that are failing to do so need to be eliminated.

How we address those public challenges in the 2011-12 state budget will impact Pennsylvania’s economy for at least a decade. We simply cannot put off the difficult decisions for another day. We must pass a budget on time and work to position Pennsylvania to emerge from this recession as an economic leader.

The state budget is one of our most powerful tools for economic development and economic recovery. While the economy is certainly not out of the woods yet, I am confident that the choices we’ve made and will make, including prudent investments and reducing the cost of running government, will help to move us in the right direction in the years ahead.

Contact:

Matt Moyer
(610) 366-2327