Wolf to introduce budget to Legislature Tuesday
Marc Levy
HARRISBURG — Gov. Tom Wolf has weathered knock-down, dragout budget fights with lawmakers, massive and unforeseen cash deficits and, now in his next-to-last year, perhaps the heaviest dose of financial stress and unpredictability he’s seen.
On Tuesday, the Democrat will deliver his seventh budget proposal to Pennsylvania’s Republican-controlled Legislature, facing a pandemic that has helped spawn a projected multibillion-dollar state operating deficit and other liabilities, including fast-expanding Medicaid rolls, new debts and a cash crunch that let other problems fester.
Still, nobody in Harrisburg is talking about tax increases or spending cuts to balance the budget.
Rather, Wolf is hoping that more federal pandemic aid will rescue the state’s finances until the economy recovers.
“I think we should have a strong bounce-back, and that would make moving forward really good, but we have some one-time challenges in this budget and a lot of it is riding on what the federal government does,” Wolf told a Greater Philadelphia Chamber of Commerce audience this month.
Underscoring the unpredictability of the situation, Wolf told reporters Thursday, “We’re all flying in an area of unknowns.”
The budget for the fiscal year beginning July 1 is being launched into the state Capitol’s highly political blame game over the government’s coronavirus response.
House Majority Leader Kerry Benninghoff, R-Centre, suggested that Republicans will look to avoid funding cuts — “We keep our commitments to those that we fund,” he said — but also downplayed expectations for a federal rescue.
“It would be irresponsible for us to think we should just sit back and expect more money coming from Washington,” he said.
Philadelphia Sen. Vince Hughes, the ranking Democrat on the Senate Appropriations Committee, is optimistic.
“I’m seeing extremely positive signs from the federal government to do what it is that we need Joe Biden and Kamala Harris to do,” Hughes said.
Five things to watch in the governor’s plan: spend slightly above $37.7 billion to maintain its current programs, with spending particularly driven by the rising cost of health care for poor people and long-term care for older adults.
That amounts to a $2.5 billion projected deficit, up from the Independent Fiscal Office’s deficit projection of $1 billion before the pandemic.
“The COVID pandemic really downshifted the economy, so we lost a full year of economic growth,” said Matthew Knittel, the office’s director.
Of course, budget-makers routinely use hundreds of millions of dollars in transfers from off-budget accounts, payment delays and other one-time maneuvers to balance the books. This year likely will be no different. schools.
School districts have, however, received billions in federal pandemic aid, but school boards will want to see Wolf propose a funding increase for them.
“I’m really hoping that the governor has a robust proposal for public education next Tuesday, because the school children deserve it and we have to figure out how to get them the help they deserve,” Hughes said.