Pa. budget talks start on worrisome note

    A week and a half before Governor Rendell’s budget address, the House Appropriations Committee held its first hearing on the 2010-2011 spending plan.

    This year’s House Pennsylvania budget hearings got underway on an ominous note Thursday.

    [audio:100128SDBUDG.mp3]

    A week and a half before Governor Rendell’s budget address, the House Appropriations Committee held its first hearing on the 2010-2011 spending plan.

    Economic expert James Diffley of the Global Insight Group gave a forecast for the coming year, and the news wasn’t pretty.

    Diffley: He says unemployment will likely stay above 10 percent for most of 2010, and retail sales will grow by just 1.2 percent, after a 5.6 percent decrease in 2009. Diffley expects 5.4 percent retail growth in 2011.

    When that happens by 2011 all we’ve done is recoup the losses in 2009. There’s been no growth in retail sales for three years. And that’s the budgetary problems – that’s the lag in budgetary problems that the states have. It takes two years just to get back to the level of tax revenue that you had to start with.

    The Rendell Administration is predicting a 450 million dollar revenue shortfall this year.

    Want a digest of WHYY’s programs, events & stories? Sign up for our weekly newsletter.

    It will take 126,000 members this year for great news and programs to thrive. Help us get to 100% of the goal.