Wednesday of this week was Leap Day, which we can only assume meant that Tuesday was Look Day. Sorry, we’re better than that. It was too easy…
State revenue collections did a little leap of their own, we found out early this morning, with the numbers coming in almost 1%, or $15 million, above estimate. While not exactly worthy of breaking out the Dom, maybe, JUST MAYBE, we are finally pointing in the right direction.
It was a busy week in under the Big Dome as we said goodbye to February with a double dose of budget hearings. The most interesting exchanges of the week came when the Department of Public Welfare came in for its annual check-up in front of the Senate Appropriations Committee. To be certain, it’s not easy being a department in line for another $600 or so million in cuts on top of last year’s haircut. Senate Democrats were, shall we say, quite blunt with their assessment of whether or not they believe the safety net will survive if the planned cuts are approved (they do not).
A growing number of GOP House members seem to be open to the idea of closing the dreaded Delaware Loophole (a mechanism used by some businesses that would rather not pay corporate taxes here in Pennsylvania, thank you very much), and perhaps eliminating the sales tax discount as well (a 1% discount for companies that collect and remit sales taxes). We’ve heard these particular songs before, and know the lyrics pretty well. It is just odd to hear a new group of House members singing lead vocals.
Staying on the tax issue for a moment, a group known at the Tax Foundation told us this week that Pennsylvania ranks dead last as far as tax burden on businesses. According to these folks, we landed at #50 only because we haven’t added a 51ststate yet (we’re, um, paraphrasing). We’ll see if this plays into the preceding paragraph if and when there is a corporate tax code debate in the General Assembly this year.
But hold on one hot minute, Mr. Gloom-and-Doom! No less of an authority than the governor himself is hailing a new study by Site Selection Magazine that ranks Pennsylvania 3rdin the nation for new or expanded corporate facilities! In fact, three of our metro areas (Lehigh Valley, Harrisburg-Carlisle and Scranton Wilkes-Barre) all cracked the top ten in their respective tiers. Not too shabby at all!
And of course, we couldn’t leave this topic without pointing out that Site Selection named Pittsburgh as the third-fastest growing market when it comes to development and corporate expansion. You see that, Cleveland? All day LONG!
We found out this week that, at least according to PennDOT, rural roads are subsidized quite a bit more than mass transit in this state, which kind of blows a hole in the entire “all of our money goes to Philly and Pittsburgh” argument. Seems that, at least when it comes to roads and bridges, most of the money generated statewide comes from (not goes to) the Philadelphia and Pittsburgh metro areas. Good thing those lawmakers aren’t considering changing the gas tax to an impact fee, with proceeds staying local.
The closing of oil refineries in southeastern Pennsylvania will, we have been assured, cause gas prices across the northeastern U.S. to spike this summer. Yeah, great. Spike to where, may we ask? Time to dust off the old Big Wheel for the morning commute to Triad. Anyhow, late Thursday the head of the Department of Community and Economic Development Alan Walker said he believed two out of three refineries slated for closure could be saved. And so we’d like you to say a prayer for this gentleman’s success.
Advocates for people with disabilities came to the capitol this week to rally against budget cuts and a newly proposed change in DPW policy that will greatly impact how home care services will be delivered. They were not met with open arms, to say the least. In fact, they weren’t met. We will be very curious to see how their message is received by lawmakers who, the last time we checked, are on the ballot this year.
The Pennsylvania Public Utility Commission is now, under a new law, empowered to inspect and ensure the safety of virtually every natural gas pipeline in the state. This is a very important development because a. we have a lot of natural gas that needs to be piped somewhere other than here and, b. until now, this job fell to the federal government, which doesn’t have enough money in the bank to take the subway let alone send inspectors into Pennsylvania.
Talk around the policy circles in Pennsylvania has increasingly turned to the state’s two public pension funds, which by some accounts are lugging around about $40 billion in unfunded liabilities and are threatening to eventually treat the state budget like Godzilla treated downtown Tokyo. Our simple word of caution to those who seek to fix the problem: moving to a dual system of defined benefits and defined contributions will exacerbate, not fix, the aforementioned problem by further de-funding the former. In short, it only throws Mothra into the mix, which nobody wants to see.
A key and quite powerful lawmaker this week came out against Governor Corbett’s proposed cuts to higher education, saying that higher ed has sacrificed enough for our fiscal woes. This is remarkable in that said lawmaker is of the Republican persuasion, setting up some potentially uncomfortable dinner conversations at the Governor’s residence.
It costs Pennsylvania taxpayers $35,000 a year to house a prisoner, and thusly, the Department of Corrections would like to begin shaving down its budget, $35k at a time. DOC is proposing to streamline the process for releasing parole-eligible prisoners, which seems entirely wise, and will also keep us from having to again ship our inmates off to other states like they are exported goods. Buy one inmate, get a second for half-price.
Jobs in health care are on pace to grow 15% in Pennsylvania over the next six years, we learned this week. If health care costs keep outpacing what the Commonwealth spends on health care, we should just train all of those workers to be emergency room attendants, since that is where everyone is gonna eventually end up, getting the most expensive care known to mankind.
It looked for a hot minute this week that the Floor of the State House was about to become the Battle of Helms Deep, as a controversial new bill that would require ultrasounds before abortions was plopped on the agenda. And as quickly as both sides of the debate fired up their rhetoric machines, the House Majority Leader came out and said “Yeah, maybe some other time.” And there was an uneasy peace in the land.
Read his lips, Philly: no new taxes. Such was the pledge from Philadelphia Mayor Michael Nutter this week, who said he will balance the city’s budget this year with no new levies. Now, you may see some of those old “temporary” levies become permanent, but let’s not get into a semantics argument here. And anyway, every time a “temporary tax” is passed, we just get into our Triad jitney and drive to Johnstown and laugh hysterically.
The Supreme Court this week overruled the lower courts and affirmed that the state will not have to pay back approximately $700 million it, um, borrowed from a fund intended to help doctors pay for medical malpractice insurance. This was obviously good news for people who weren’t looking forward to another giant budget hole, but pretty crappy news if you happen to be a doctor.
During a budget hearing on basic education funding, the time-tested theory of school consolidation was again raised, as it has been every year since the Reconstruction. And although most rational people see an upside to consolidation for both students and taxpayers (see Central Valley SD in Beaver County), it never seems to gain any real traction in the halls of state government. It’s just fun to discuss, like who wore what dress on the red carpet at the Oscars.
The Supreme Court also ruled this week that the Speaker of the House must schedule six special elections concurrent with the Primary Elections, further throwing chaos into an already chaotic pile of mass K.A.O.S. If you plan on following the elections this year, you should probably not even bother until November. It will be way too confusing.
Do you know how much fun we had on the Triadvocate this week? It was more fun that the original Barrel of Monkeys, which we were told in our youth that there was nothing more fun than (that whole thing turned out to be a big fib, anyway). First up, we had a very special client spotlight with our friends at Inglis Foundation, which you should take a moment to watch. Get to know these folks and restore your faith in humanity.
We also decided to give you an advanced clip for next week’s interview with House Transportation Chairman Rick Geist. Check out a quick clip of Geist’s thoughts on P-3s in PA, and be sure to also check out www.citizens4rebuildingpa.com.
And for the coup de grace, we brought you this one-on-one interview with Sharon Ward, the Executive Director of the PA Budget and Policy Center.
Whew! We’re beat! But we’ll be back at it bright and early Monday to make sure nothing gets past us, and as a byproduct, nothing gets by you! Follow the Triadvocate on Twitter @TheTriadvocate, and as usual, get on our social media train with Facebook and Twitter. And if you haven’t checked out our master budget page yet, we haven’t the foggiest idea why.
From all your friends at Triad, have a great weekend!