House Bill 493 (Gabler-R-Clearfield), which changes the process for the review and approval of Capital Budget projects and reduces the overall borrowing limit by $600 million, was passed by the Senate and concurred in by the House Wednesday and sent to the Governor for his action.

“In stark contrast to what is happening in Washington, D.C., the Pennsylvania General Assembly today passed legislation to reform a much-abused state funding program,” said House Majority Leader Mike Turzai (R-Allegheny).

The legislation passed the House by a vote of 194-0 and would put new controls in place to curtail mounting levels of public debt for projects funded by the Redevelopment Assistance Capital Program. RACP uses borrowed money to fund economic development projects selected by the governor.

"All state-funded projects deserve public scrutiny and careful evaluation, and this legislation will make it happen," Rep. Turzai said. "Working with the governor and legislative leaders, we have been able to reduce the debt ceiling and debt payments, and we brought openness and accountability to the process."

"This is a strong reform bill," said Senate Majority Leader Dominic Pileggi (R-Delaware). "It builds on our work making state government more transparent and accessible to the public, and it will have a tangible impact on reducing the state's debt level. I was pleased to work with Leader Mike Turzai, Senate President Pro Tempore Joe Scarnati and Representative Matt Gabler to send this bill to the governor."

House Bill 493 will immediately reduce the RACP debt ceiling from the current $4.05 billion to $3.45 billion. The bill does not eliminate the economic development grant program, but redefines it and makes it financially viable.

Decreasing the Commonwealth's debt load and reforming RACP is an important keystone as the General Assembly brings integrity and transparency to the way Pennsylvania does business.

RACP provides grants to local communities for the acquisition and construction of regional economic, cultural, civic and historical improvement projects. The funding may be used for the design and construction of facilities that are economic development projects which generate substantial increases in employment, tax revenues or other measures of economic activity.

No RACP project may receive funds unless the project was itemized in a capital budget project itemization bill, a capital budget bill or a capital project itemization bill enacted within 10 years of the date the project is approved.

"Unlike the current dysfunction we currently see in Washington, DC, we are showing in Pennsylvania that we can work in a bipartisan, bicameral manner to responsibly manage taxpayer dollars," Rep. Gabler said. "This is a good government bill that represents a significant win for our taxpayers, job creators and future generations of Pennsylvanians."

The new process is objective and ensures projects are chosen based upon merit, impact on economic development and level of public-private partnership, geographic disbursement and shovel readiness.

The perception of favoritism would be removed if this legislation becomes law.

Finally, the legislation would create a new stringent review and approval process within the Office of the Budget. The Budget Office would develop eligibility criteria and establish guidelines for the process.

"Pennsylvanians expect us to fulfill our commitments – for government to live within its means and to change the way we do business in Harrisburg. House Bill 493 continues our efforts to deliver on that commitment," Rep. Turzai said.

A summary and House Fiscal Note are available for House Bill 493.

Senate Bill 680 (Corman-R-Centre), which provides for an itemized list of Capital Budget projects for FY 2012-13, was referred to the House Appropriations Committee.  The House Appropriations Committee is scheduled to consider the bill on Monday, October 21 and House Republicans said this bill will be considered by the full House next week.

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10/21/2013