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House Republicans Pass Budget Proposal With Across-The-Board Cuts… Again

House Republicans Monday unveiled their initial FY 2017-18 General Fund budget proposal totalling $31.52 billion which is $245.6 million less than the current year budget and $115 million less than Gov. Wolf’s proposal. Republicans passed the bill Tuesday by a vote of 114 to 84.

The proposed budget makes across-the-board cuts in state agency personnel line items, including-- DEP-- $7.3 million, DCNR-- $2.8 million and in Agriculture, as well as a $506,000 cut in funding for county conservation districts, cuts in line-items for all interstate commissions at DEP and a $625,000 reduction in DCNR’s Heritage Parks Program.

At the same time, the Department of Revenue reported March state revenues were down $229.6 million, or 4.9 percent, below estimates and fiscal year-to-date collections were down $679.3 million, or 2.9 percent, below estimate.

The Republican budget does not increase general taxes or propose new bond issue funding. There is no increase in the minimum wage.

The budget fulfills a 3-year commitment to increase education spending by $150 million and increases the Education Improvement Tax Credit Program by $75 million.

House Majority Leader David Reed (R-Indiana) explained the budget still needs $800 million in new revenue to be balanced and said his Caucus had put together a menu of $1.6 billion in budget balancing options (not yet available).

On the top of the list are $247.5 million from liquor expansion, $376 million from gaming expansion, including iGaming, airport slots, tablet gaming and fantasy sports, $160 million in transfers from special funds and $25 million in potential tax credit reductions.

House Republican Appropriations Chair Stan Saylor (R-York) also said the budget includes across-the-boards cuts in state agency personnel line-items, cuts in funding for the House and Senate by 6.5 percent (it increased 21 percent in the last 14 years) and cuts what he called “corporate welfare” (no details yet).

The Republican budget eliminates these legislative committees and agencies--

-- Legislative Budget and Finance Committee – These functions can be transferred to the Independent Fiscal office (IFO).

-- Local Government Commission – The work of this commission falls under the purview of the House Local Government Committee.

-- Joint Legislative Air and Water Pollution Control and Conservation Committee – The work of this joint legislative committee can, and should, fall under the purview of the House Environmental Resources and Energy Committee.

-- Center for Rural Pennsylvania – The functions of this agency would be served through the House Committee on Local Government, the state Department of Community and Economic Development, and universities.

The budget also--

-- Agriculture: Reduced Agriculture funding by $35.6 million (including personnel and $30.1 million for University of Pennsylvania Veterinary School) and funding to Conservation Districts by $130,000;

-- DEP: Reduces DEP funding by $8.9 million from current year (mostly personnel-- $7.3 million, but cuts in funding for Conservation Districts-- $376,000; the Susquehanna, Delaware and Potomac River Basin Commissions, Ohio River Sanitation Commission, Chesapeake Bay Commission and Interstate Mining Commission);

-- Failure To Meet Minimum Federal Standards: The proposed budget does not address the fact that DEP does not have the resources to meet minimum federal requirements in the Safe Drinking Water, Air Quality, Surface Mining and other programs. House Republicans are apparently content to let DEP raise permit fees to make up for yet more cuts as Rep. Saylor said during the budget hearings-- “great.”

-- West Nile/Zika Virus Control: Cut by $338,000;

-- DCNR: Reduces DCNR funding from Governor’s request by $2.8 million (personnel) and funds State Parks and Forestry operations from Oil and Gas Lease Fund revenues;

-- Heritage Parks: Reduces DCNR Heritage Parks funding to $2.25 million ($625,000 cut); and

-- USTIF Loan Repayment: Eliminates $7 million Underground Storage Tank Indemnification Fund loan repayment.

The Republican budget was included in an amendment to House Bill 218 (Saylor- R-York) that was voted out of the House Appropriations Committee Monday by a party-line vote. The House passed the bill Tuesday by a vote of 114 to 84.

More details should be coming out in the next 24-hours because House Republicans want to pass the budget this week.

For example, a proposed “Endowment Fund” was described verbally as a new fund that would do everything in Gov. Wolf’s proposed $387.4 million bond issue to fund operating costs and provide funding for several environmental programs and State Police fee proposal. The Fund would be financed with “new revenue,” but there are no details yet.

Click Here for a copy of the House Republican budget spreadsheet. Click Here for the 1-page House Republican summary. Click Here for the General Fund Financial Statement.

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