Gov. Tom Wolf says there’s a lot he’d like to do with the billions of federal dollars set to flow into Pennsylvania now that President Joe Biden has signed the massive stimulus plan.
But in a virtual appearance Thursday at a conference for the Pennsylvania Budget and Policy Center, the governor, who has less than two years left in his term, said he doesn’t have much hope he’ll be able to do any of it.
“If the federal government is going to give us $7 billion, I can guarantee the Republicans are going to say, ‘Let’s continue to kick the can down the road,’” he said. “And I think that’s unfortunate.”
It’s still not exactly clear what Pennsylvania’s share of the $1.9 trillion COVID-19 rescue plan will look like. Officials are expecting more details on how the money can be spent after it’s signed into law.
But on top of the $7.3 billion that’s slated for the state government, local governments are expecting $5.7 billion to be directly available for their needs.
Those amounts also don’t include additional infrastructure subsidies and direct payments to Pennsylvanians, including a child tax credit that will give most parents monthly subsidies of up to $300 per child for a year.
Wolf called the stimulus a “heaven-sent opportunity.” He said if he had his way, he’d use it for projects including updating aging bridges and highways.
Wolf’s proposal is the centerpiece of his 2021 budget plan. In his pitch in February, he said the initiatives could be funded through road toll hikes, borrowing against a proposed natural gas drilling tax, and an income tax hike — creatively structured to place most of the burden on higher earners.
Republicans who control the legislature called that plan “dead on arrival.” And though Wolf now may have a way to fund some of those projects without taxes, he said he’s not hopeful GOP leaders will change their minds.
Republicans in both chambers have refrained from naming many specific priorities before determining how the money is allowed to be spent.
But Jason Gottesman, a spokesman for House Republicans, said his caucus believes that “this one-time influx of money should not be used to increase funding for line-items requiring recurring revenue.”
“It should be used prudently and in a way that efficiently serves their interests in the immediate and long-term,” he added.
It’s a dynamic that is familiar in the commonwealth.
After Pennsylvania got federal stimulus dollars during the Great Recession, then-governor Ed Rendell, a Democrat, used a portion of the money to increase education spending.
When that money ran out a few years later, Rendell was out of office and Republican Tom Corbett was at the helm.
Instead of backfilling the commonwealth’s education budget with new state dollars, Corbett kept much of the state’s contribution stable and the overall education funding plummeted compared to the stimulus years. It was a move that proved highly unpopular among voters and is widely credited for Corbett’s loss to Wolf after his first term.
In this impending round of stimulus negotiations, Wolf said he expects that Republicans will want to use the federal money to fill deficits in Pennsylvania’s existing, relatively lean budget. The state Independent Fiscal Office has estimated the pandemic-induced shortfall to be around $2.5 billion, which would still leave billions of the stimulus left over.
Pre-pandemic, lawmakers had expected 2020 and 2021 to be fruitful years for state coffers, with minor year-end surpluses.
“It will be some future administration that will have to face up to the consequences,” he said. “Sooner or later, that structural budget deficit is going to bite us all. A bridge is going to fall down.”
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