Too early for budget optimism
The completion of Pennsylvania’s 2016-17 budget exercise doesn’t justify an end to pessimism regarding the commonwealth’s financial future.
State residents should recognize Wednesday’s budget passage for what it truly was: a ticket for lawmakers to go home to, in most cases, gear up their re-election campaigns and for Gov. Tom Wolf to avoid blame for a second consecutive budget debacle.
The revenue package passed by the House and Senate and signed by Wolf is built upon many big money assumptions, some that might come up woefully short.
It’s not out of the question that the Keystone State will be dealing with another big money shortage at this time next year. In fact, that’s what some lawmakers already have predicted.
Nevertheless, throughout the coming months, lawmakers will be trying to put the best spin possible on this year’s budget negotiations, while hoping residents forget last year’s fiasco.
They’ll proclaim how they strived to work on behalf of the people’s and state’s best interests, when in fact for most of the time they allowed themselves to be mere puppets to legislative leaders’ wishes.
Look for legislators and the governor to ignore how their lack of cooperation the last fiscal year was nearly the cause for some school districts to shut down, forced social service agencies to curtail operations and staffs and created negative ramifications for counties.
Look for them to avoid specific answers about how much the budget-related damage to the commonwealth’s bond rating will cost the taxpayers in borrowing costs, going forward.
The budget deal also fails to address the most critical problem facing the state: the black hole of pension shortfalls that continue to suck up more and more school district and state tax dollars.
Instead, lawmakers will pound their chests triumphantly for having avoided broad increases in the state personal income tax and sales tax.
While that might look good in many taxpayers’ eyes, the point is that what Harrisburg accomplished Wednesday could have been completed by the 2015-16 and 2016-17 budget deadlines, if the legislative and executive branches had placed compromise above stubborn, unbending partisanship.
On Wednesday, it was proclaimed that the newly enacted spending package will significantly address the state’s structural deficit, which had been listed as about $1.8 billion. State residents need to be skeptical of that claim.
Meanwhile, state residents should watch whether credit agencies are willing to at least partially restore the state’s stronger pre-budget-debacle bond rating.
Then there’s the biggest question of all: Are the money assumptions contained in the 2016-17 revenue document realistic?
Probably not, although it’s to be hoped that pessimism is proven wrong.