Budget talks progressing, new cuts planned

Pennsylvania Governor Ed Rendell says budget talks are progressing, and he and legislative leaders have agreed on 72 million dollars worth of new cuts.

Pennsylvania Governor Ed Rendell says budget talks are progressing, and he and legislative leaders have agreed on 72 million dollars worth of new cuts. But Rendell says the budget reductions mean more state employees will be laid off once the new spending plan becomes law.

Listen:
[audio: 090707sdlayoffs.mp3]

Rendell says the reductions come from the Welfare, Education, and Community and Economic Development Departments, as well as the executive office budget.

The bulk of the cuts will be to personnel, which means more state employees will be let go.

Rendell:  I think to achieve the year-long dollars that we need, a lot of it’s going to be layoffs. Again, we’re not talking about 15-hundred, 2 thousand layoffs, but there will be close to 800 layoffs, I think.

Laying off a thousand employees would save the state 25 million dollars, according to Rendell.

The governor says he expects to offer another 50 million dollars worth of budget reductions, and is hoping legislative leaders can trim up to 70 million dollars from their operating costs.

After that, Rendell says tax increases will have to make up the rest of the state’s budget gap.

Republican leaders maintain the deficit can be closed without imposing new taxes.