HARRISBURG - Facing a potential $1 billion revenue shortfall, lawmakers critical of Gov. Tom Corbett's budget proposal pressed their ideas Wednesday to raise taxes or cut costs as Corbett's top budget adviser acknowledged the severity of the problem.
Pennsylvania's April tax collections remained well behind projections Wednesday with one day to go in the important revenue month.
Corbett's budget secretary, Charles Zogby, did not give specifics on how the administration plans to deal with the shortfall. But he did acknowledge that the shortfall could be $1 billion or more, and said the governor is planning more meetings with leaders of the Legislature's Republican majorities.
But he also suggested that the administration is not panicking.
"We've been doing this for four years. I don't go into crisis mode that easily," Zogby said. "It's certainly not good news."
Senate Appropriations Committee officials said the shortfall through 29 days of April was $477 million, or 13 percent, mostly because of lagging personal income tax collections. That compounds a deficit that was about $170 million on April 1, creating another significant hurdle for Corbett's election-year budget that already took some risks when it was proposed three months ago.
The potential shortfall is tantamount to a $1 billion-plus gap because it reduces next year's revenue projection by a dollar-for-dollar amount.
Senate Minority Leader Jay Costa, D-Allegheny, made the case on the chamber's floor for a list of ideas the caucus says could save or generate more than $1 billion. Those include privatizing the management of Medicaid-funded nursing home care and authorizing the state treasurer to process federal disability claims for other states.
"We have a hole of $1 billion," Costa said. "We have to get serious about a conversation of how we address that."
Separately, Rep. Gene DiGirolamo, R-Bucks, had his own set of proposals, including imposing a severance tax on the booming natural gas industry and an excise tax on smokeless tobacco.
"I hope that what we're proposing here is part of the discussion," DiGirolamo said. "It's sustainable, reasonable and responsible."
Both DiGirolamo and Senate Democrats want to undo a reduction in the capital stock and franchise tax that businesses pay, impose an excise tax on smokeless tobacco, end the practice of allowing retailers to keep a portion of the state sales tax they collect and expand Medicaid under the 2010 federal health care law.
Senate Democrats are proposing to plan to refinance a portion of the state's public employee pension liability in a bid to lower annual payments beginning next year.
Corbett's plan to pare back public employee pension benefits in an effort to cut costs went nowhere in the Legislature last year. He is backing a more modest plan that remains under construction two months before he hopes lawmakers will approve it.
It would postpone some pension obligation payments required under a 2010 law to provide immediate budget relief to the state and school districts.
Corbett's spending plan for the 2014-15 fiscal year that starts July 1 is an increase of almost 3.7 percent, or more than $1 billion, over the current year's approved budget. The spending increase largely would go toward underwriting a new grant program for public schools, shortening waiting lists for social services and paying for rising payments for public employee pensions and health care coverage for the poor, disabled and elderly.