The Senate and House begin agency-by-agency hearings on Gov. Wolf’s $32.3 billion FY 2017-18 budget request Tuesday.  The hearings run through March 9.

The initial reaction to his budget from Senate and House Republicans was generally “something we can work with.” 

At the same time, Senate Majority Leader Jake Corman (R-Centre) lamented the fact the proposal did not deal with the biggest cost-driver in the budget-- pensions.

Speaker Mike Turzai (R-Allegheny) said he may have different priorities for spending in the budget, particularly on education.  He has House Bill 250 moving through the House giving $150 million more to private schools through the Education Improvement Tax Credit Programs.

To set the stage for the hearings to follow, the House and Senate Appropriations Committee will hear from the Independent Fiscal Office on the first day of hearings.

On February 10, the Independent Fiscal Office updated its latest projections of the long-term structural deficit to be closer to $2.74 billion-- $774 million for FY 2016-17 and $2.08 billion in FY 2017-18.  Click Here for an IFO background packet for the budget hearings.

hat’s actually down slightly from its January 26 estimate of as much as $2.9 billion, but still not good.  We’ll see that they say Tuesday.

One almost bright spot this week was a revenue report from the PA Gaming Control Board saying revenue from table games at Pennsylvania casinos was up 2.1 percent in January, although it is down for the year so far.  Last week, the PA Gaming Control Board reported slot machine revenues were down 2.4 percent in January.

Gov. Wolf’s Budget Office this week released a copy of the 79-page $1.8 million McKinsey & Company report (that’s $22,784.81 per page) making suggestions for changing state operations to save an estimated $1.3 billion.  Among the general lines of suggestions were--

-- Get more money from the Liquor Control Board and Pennsylvania Lottery;

-- “Reset” the level of grant funding for other levels of government;

-- “Reset” the level of grant funding for individuals and institutions (higher education);

-- Raise bond funds to finance selected discretionary grant programs;

-- Reduce the cost of procured goods and services;

-- “Reset” workforce size across agencies;

-- Adjust fee structures across agencies; and much more.

The report goes on to describe specific steps to be taken under each broad category.  Several of the suggestions in the report were included in Gov. Wolf’s budget, like combining the departments of Health, Human Services, Aging and Drug and Alcohol Programs, selling the Farm Show Complex and floating a $384.7 million bond to finance certain grant programs.

Once the stage is set by the opening budget hearings, both the Senate and House Appropriations Committees will hear from the Auditor General, Attorney General and State Treasurer, the Department of Labor & Industry and the PA State System of Higher Education and other agencies.

In addition, the House Appropriations Committee also hears from the school and state employee pension funds to outline their current status.

The budget hearings for DEP are February 27 in the House (10:00) and March 9 in the Senate (10:00).  The hearings on DCNR’s budget request are February 27 in the House (1:00) and March 1 in the Senate (3:00).

Click Here to watch House hearings live.  Click Here to watch Senate hearings live.

As a reminder, the House returns to voting session on March 13 and the Senate on March 20.

Let the games begin!

NewsClips:

Editorial: Legislators Need To Review State Drinking Water Program Too

Hayes: Gas Drilling Deals Earn Cash For Game Commission

Crable: Game Commission Still Considering Closure Of Middle Creek Center

PA Business Leaders Rap Wolf Budget As Too Tax Heavy

Unclear Who Would Lose In Wolf’s Tax Credit Cut Proposal

Wolf Moves To Change Management Of 2 Big Retirement Fund

AP: Wolf Uses Broad Definition To Claim $2B In Cuts, Savings

Wolf Budget Consultant: Squeeze LCB For More Cash

Copy Of Budget Consultant Report

Layoff Of 500 From Jobless Call Centers Continue To Spread

Swift: State Tax Credits In Budget Crosshairs

Swift: State Budget-Savings Accord Hinges On Details

Wolf Budget Proposal Called Realistic Starting Point

Obamacare Uncertainty Makes It Harder To Plan PA Budget

Op-Ed: Will GOP Buy Into Working With Wolf On His Budget?

Op-Ed: Good Luck Trying To Take Re-Election Politics Out Of Wolf’s Budget

Op-Ed: Is Wolf’s Budget Warm Up Lap For 2018 Election?

Editorial: Minimum Wage Fallout: The Cost In Jobs

PA Workers’ Comp Insurance Company Says Some Employers Cheating

[Posted: Feb. 17, 2017]

2/20/2017