Region’s lawmakers guarded on budget

By BRIAN FERRY

bferry@timesobserver.com

Gov. Tom Corbett announced his proposed state budget on Tuesday.

It features privatizing liquor sales and the lottery, removing a cap from wholesale gas taxes, and “putting a record amount… into basic education.”

The $28.4 billion budget increases spending by about $100 million compared to the current year, maintains funding levels for higher education, does not increase income nor sales taxes, and includes cuts to business taxes.

It includes additional funding for transportation – “the bloodstream of our economy,” according to Corbett – and “more than 35 million (dollars) to fund the nation’s best farmland preservation program.”

The governor proposed “$2.5 million to county fairs. Any event that brings our farming community together results in progress.”

The five-year phase-out of the cap on wholesale gas taxes does not represent a new tax, Corbett said.

It does not increase Medicaid spending requested by the federal government.

“Selling liquor is not a core function of government. Education is,” Corbett said. “We need to put our liquor system into private hands.”

It’s a little early for detailed comment, but two local legislators provided their thoughts on the proposed budget.

“This is the starting point of every year with the state budget,” Rep. Kathy Rapp (R-65th) said. “We have not had an opportunity to have a caucus on his budget.”

“The next process would be for the House and the Senate to look at the governor’s budget and his plan and start drafting a plan,” Rapp said.

Budget hearings begin Feb. 19, she said.

“The secretaries of all the agencies will be presenting … what they would like to see of the General Assembly,” she said. The legislators will pose questions and expect that the agency leaders present information about how they spend money in their budgets.

“According to the governor, there are no new taxes in his budget,” Rapp said. “I really do not want to see (more) taxes on the constituents of the 65th District.”

“I do believe the House and Senate will hold the line on taxes,” she said.

She said she found the funding levels for public education and human services encouraging at the local level.

“I was pleased to see more money for the people with disabilities on the waiting list,” she said. “That’s something that people have been requesting for a long time. Investing in care for our people with disabilities is a move in the right direction.”

Sen. Scott Hutchinson (R-21st) also sees education funding as one of the items that will have a significant local impact.

“There is more money for education,” he said. “We’re going to make sure the rural districts get their fair share of that.”

It’s too soon to call most of the ways Warren County will be affected by the proposal.

“It’s really hard to see that at this point,” Hutchinson said. “We have general line item formulas.”

“This is first blush. Because of some difficult but correct decisions, we’re now turning the corner and have a little bit more resources to work with,” he said. “It’s going to be a tough budget year, but not overwhelming as some in the past.”

“We have a couple other very large issues that could impact future budgets – the pension, for example,” Hutchinson said. “Liquor, transportation, these are all big-ticket items that we’re in a position to at least address them now. Those are going to be the dominating discussion over the next several months.”

The governor has the power to change the lottery system, but privatizing liquor sales and reconfiguring the pension system will require action at the legislative level.

The proposed budget includes savings based on legislative action that has not taken place.

“He made some assumptions that we’ll make some changes,” Hutchinson said. “The savings are reflected in the amount of funding available.”

The assumptions came with an ultimatum of sorts. If pension savings are not realized, other areas of the budget, like public education, will not receive as much, Corbett said.

Hutchinson said “it’s really hard to tell at this point” where the Senate is leaning on the pension issue, but a defined contribution plan – like a 401(k) – for state employees is a possibility

“There’s a realization that we have to do something,” he said. “That is more in line with what the vast majority of people in the private sector have.”

The proposed changes would not affect retirees and any pension benefits already earned.

Hutchinson said Corbett drew “lines in the sand” on those points. “The only question is going forward,” he said.