A state budget standoff has been going strong since lawmakers passed a spending plan Friday, but no revenue package to pay for it.
As members return from their Independence Day recess, House and Senate Republican leaders don’t appear much closer to a consensus.
The budget that’s currently sitting on Governor Tom Wolf’s desk becomes law automatically at midnight on Monday — even if it’s not balanced. If that happens, credit rating agencies are already warning of possible downgrades.
The conflict is coming down to differing views among GOP lawmakers in the House and Senate.
In a strongly worded note to members, House Leader Dave Reed defended his caucus’ proposed revenue plan, saying that “to just walk away from legitimate concepts in favor of tax increase after tax increase is just not realistic or acceptable.”
He struck a pessimistic tone, saying while the House will compromise, members won’t “completely abandon” their proposals.
Senate GOP spokeswoman Jenn Kocher countered that the House’s proposals were never realistic in the first place.
“The House has to remember that they were two billion dollars out of balance in the budget they presented, and never closed that gap. And now we are left with trying to close that gap,” she said.
One prominent point of contention has been whether to legalize video gambling terminals in bars and taverns.
The House has firmly backed that option. But Kocher said it still isn’t getting traction in the Senate.
“We don’t have 26 votes for it, which we have been telling the House and others for months,” she said.
Both GOP caucuses maintained that they remain opposed to raising sales and income taxes, though Kocher said everything else is still technically on the table.
Both chambers are expecting to work through the weekend.
Meanwhile, rating agency Standard and Poor’s has put Pennsylvania on its Credit Watch list, warning that it will probably lower the state’s rating if the budget is balanced on “optimistic assumptions or one-time sources.”
Governor Tom Wolf called the S&P letter an “urgent call to action.”