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Pa. budget deficit tops $1 billion

Tuesday, May 4th, 2010

Pennsylvania’s budget deficit has expanded to more than a billion dollars.

Governor Rendell says that means another round of state employee layoffs.

April tax collections came in nearly $400 million below projections, increasing the state’s revenue shortfall to $1.1 billion.

Senate Appropriations Committee Chairman Jake Corman, a Centre County Republican, says he expects the figure to reach $1.3 billion by the end of June.

“We really need to start over,” says Corman, “start from scratch, and figure out a way to put this budget together on time before June 30th, that reflects the revenues we have, as opposed to what was reflected back in February.”

Governor Rendell agrees with Corman on the fact more budget cuts will now be needed.

“And there is some area to be cut, but not much,” says Rendell. “That means that further cuts and reductions in spending will have to come from layoffs and furloughs.”

Corman says all four legislative caucuses are against a broad-based tax increase, but Rendell says the state needs to bring in new revenue.

He wants the General Assembly to pass taxes on natural gas drilling, cigars, and smokeless tobacco.

In February, Rendell proposed setting those tax proceeds aside in a special fund.

He now says some of that revenue would be needed in next year’s budget.

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