For months now, Governor Tom Wolf has been promising a radical departure in his budget proposal for next fiscal year.
On some counts, he delivered on Tuesday.
Gone from Wolf’s plan are the broad-based taxes the Democrat attempted to pass in his last two budgets. Instead, the proposal is balanced largely on a little more than $2 billion in efficiency savings.
“Harrisburg,” Wolf said in his address at a joint legislative session,” has been living beyond its means. Households can’t do that, and neither can we.”
Wolf did, however, include a few of his budgetary standbys–including a perennially unsuccessful natural gas severance tax and minimum wage hike.
Some of the major parts of Wolf’s proposal were announced well in advance of his formal address–namely, consolidation of various health agencies and closure of a state prison.
Other components of his $2.1 billion in efficiencies include cutting tax credits, keeping state employment at a minimum, levying new local fees for state police coverage, and leasing out the Farm Show Complex in Harrisburg for $200 million up-front–a one-time return.
There are about a billion dollars in new revenues, too. That includes the gas tax, an expansion of corporate Sales and Use taxes, and restructuring of insurance and businesses taxes.
House and Senate Republicans said the administration’s estimated revenues for those taxes sound too high, and they were particularly skeptical of the gas tax, which has been repeatedly defeated by GOP majorities in the past.
But House majority leader Dave Reed noted that his caucus is cautiously optimistic about the proposal.
“There’s obviously a lot of questions about his billion-dollar revenue package,” Reed said. “But, we’re also very heartened by the fact that he took the time to put together $2 billion worth of cost efficiencies, spending reductions, mergers and consolidations.”
Senate Majority Leader Jake Corman took a slightly more oppositional tone, saying that the most telling thing about the proposal “was what was not in [it].” Namely, he said he’s disappointed Wolf didn’t include fixes for rising pension and health and human services costs.
“Those two items alone will cost us billions in new dollars every year, which our revenues won’t be able to keep up with,” Corman said.
The spending plan totals $32.3 billion dollars–a 1.8 percent increase from the current budget.