HARRISBURG (WSKG) -- Pennsylvania has struggled for a decade to pass balanced state budgets, and this year was no exception. A funding plan finally made it to Governor Tom Wolf's desk four months after it was due, though like all his previous budgets, Wolf let it become law without a signature. Many fiscal watchdogs say it doesn't do much to address the commonwealth's underlying issues anyway. Off the bat, lawmakers were at a disadvantage when creating it. Revenue had come in more than a billion dollars less than expected the year before, and all told, they were on the hook to fill a $2.2 billion hole.
HARRISBURG (WSKG) -- Several Republican state senators plan to introduce legislation that would require Pennsylvania to use zero-based budgeting--a standard specifically designed to save money. The idea comes from lawmakers' annual, unsuccessful struggles to balance the commonwealth's books. However, other states that have attempted to use the method have often opted not to stick with it. Zero-based budgeting basically requires a rotating percentage of state agencies to re-justify all their operations and expenses every five years, and estimate the minimum amount of money they need to continue them. The author of the new measure, York County Republican Scott Wagner, said he's taking cues from the private sector.
HARRISBURG (WSKG) -- Pennsylvania is already on track to have a significant budget gap to fill next year. A study from the Independent Fiscal Office shows lawmakers will likely need to come up with about a billion dollars to keep the books balanced. They only just finished this year’s budget, four months behind schedule. It was mostly filled with borrowing, expected revenue from a gambling expansion and a number of internal fund transfers. Much of the money isn’t recurring, and that’s a big reason why the IFO is predicting the state will have to find more cash next year.
HARRISBURG (WSKG) -- Pennsylvania is going to borrow against its Tobacco Settlement Fund to fill in last year's deficit and finish this year's budget The Wolf administration confirmed Tuesday that it will tap into the stream of money states have received from tobacco companies since the 1990s. The borrowing will give the commonwealth money to balance its books up front, and will then be paid back over several decades. The Commonwealth Financing Authority approved the plan Tuesday. However, Budget Secretary Randy Albright noted that it's not finalized yet. "The resolution today simply allows staff at the CFA to put together a professional team, and go out and ascertain in the market what the most cost-effective financing plan should be," Albright said.
ALBANY (WSKG) - Two reports issued in recent days indicate that Gov. Andrew Cuomo may be facing his most difficult budget in seven years. The midyear financial report by the governor’s budget office has lowered revenue estimates by $850 million for the current budget year and the next two years. And it finds that next year’s projected deficit is now at $4.4 billion, if spending growth continues unchecked. Cuomo began sounding the alarm weeks before the report was released. “The state is already facing a $4 billion deficit going into next year,” Cuomo first said in late September.
HARRISBURG (WSKG) -- After a tumultuous budget process that saw state lawmakers pass a plan they couldn't fully pay for, many are looking into changing how the system works entirely. For four months, the budget was in a sort of limbo. A $32 billion spending package passed just after the June 30th due date, so most state spending continued as usual. But the budget was over $2 billion out of balance, and stayed that way until late last month. A number of lawmakers--and others--want to keep that from happening again "It has to be one vote so we don't spend money we don't have, and frankly so politicians don't get to say, 'I want to spend this money, which is popular, but I'm not going to vote to pay for it because that's unpopular,'" Montgomery County Senator Daylin Leach said.
HARRISBURG (WSKG) -- One of the biggest parts of the budget plan that Governor Tom Wolf has now mostly signed into law is $1.5 billion dollars worth of borrowing. But Wolf said Monday it's not yet set in stone where that money will come from. The legislature's plan called for borrowing from the Tobacco Settlement Fund--which gets yearly payments from a settlement states made with tobacco companies in the late 1990s. But while he was waiting for lawmakers to pass it, Wolf came up with his own approach -- deciding to borrow the money against future revenue from the state-run liquor industry. The Liquor Control Board has already begun the process of approving borrowing, and the Commonwealth Financing Authority, or CFA, is scheduled to consider the legislature's tobacco plan.
HARRISBURG (WSKG) - The state Treasury has authorized a major $1.8 billion loan to keep Pennsylvania's general fund from running out of money. It comes just in time for the commonwealth to make major public school payments. Over the last several years, it became routine for the Treasury to extend large loans early in the fiscal year, because the bulk of state revenues have tended to come in later months. But this year, Treasurer Joe Torsella refused to follow suit until the state budget was finished--calling it irresponsible to do so. The Senate and Governor Tom Wolf supported the decision to delay the loan, though House Republicans didn't. Wolf still hasn't confirmed whether he'll sign the legislature's now-complete revenue plan, but Torsella said he's comfortable lending the money based on the administration's promises to manage funds responsibly. In a statement, Torsella said because of the "unusual events surrounding this year's budget," the Treasury opted to add provisions to the loan that would "secure Treasury's investment, and provide alternatives if circumstances change."
ALBANY (WSKG) - New York Gov. Andrew Cuomo, in a conference call with California Gov. Jerry Brown, singled out two New York GOP congressmen for criticism after they voted for a budget measure that clears the way for a vote on the Republican plan to overhaul the tax system. Cuomo has been speaking out nearly every day against a proposal in the federal tax overhaul plan to eliminate state and local tax deductions from federal income tax filings. He calls it double taxation and a political attack on New York. The state comptroller has said New Yorkers would lose $72 billion in state and local tax deductions if the Republican plan in Congress were to be approved. That’s because New York has one of the highest local tax rates in the nation.
HARRISBURG (WSKG) -- The state House has sent a gambling expansion bill to Governor Tom Wolf's desk--effectively finishing the budget they've labored over this entire fiscal year, four months past the due date. The long, complex measure prompted hours of debate over the course of two days. It significantly broadens Pennsylvania's 13-year-old gaming industry. Gambling in airports and over the internet will now be legal. Truck stops across the commonwealth can install video gaming terminals--or VGTs--and up to 10 new miniature casinos are authorized. Lawmakers have repeatedly failed to pass similar bills in recent years.