Differing Pa. revenue projections pose challenge in budget talks

Lawmakers are scratching their heads over two different economic analyses that are key to putting together a budget for Pennsylvania.

At stake is Governor Tom Corbett’s proposed spending increase of more than $900 million.

The Corbett administration has projected a 4 percent revenue increase next year.

Meanwhile, the nonpartisan Independent Fiscal Office expects revenue projections to come in about $375 million below the governor’s estimate for the next year and a half.

But the IFO’s projection doesn’t consider certain factors, according to Revenue Secretary Dan Meuser.

“One of them is the commonwealth’s transportation bill that will have some positive revenue effects and some real positive economic effects,” he said Monday.

Lawmakers may not know until May, when the IFO is expected to release a report on the legislation’s impact, just how much the transportation bill will boost state revenues.

It could be a “a wash” if greater state spending is offset by a drop in consumer spending due to higher gas prices, said the agency director.

The bill, which provided funds for transportation and infrastructure improvements and projects, uncapped a tax on wholesale gas.