Lawmakers review budget accord
Gov. Edward Rendell said he has decided to wait to sign a $28.05 billion budget, which the Senate and House passed Wednesday, containing education subsidy increases for local school districts. Sen. Richard Kasunic, D-Dunbar, said the budget contains significant cuts in everything except education, but it does not raise or create new taxes that residents pay.
“It’s a budget where there are significant cuts in various programs, in fact, all programs. There wasn’t an agency or department, with the exception of public education, that didn’t get cut,” said Kasunic.
“If there’s any good news, it’s that there’s no new taxes or increases this year. It’s a bare-bones budget.”
Total spending in the proposed budget is about .6 percent more than the current budget and public education would benefit, he said.
The deal would add $250 million in basic-education funding without raising new taxes, but it also would spread cuts widely across state government and result in an unspecified number of government worker layoffs.
Laurel Highlands School District would be the biggest beneficiary among the school districts in Fayette County with a 6.3 percent increase in its subsidy. The rest of the increases are 3.7 percent for the Connellsville Area School District, 3 percent for the Frazier School District, 2.9 percent for the Brownsville Area School District, 2.8 percent for the Uniontown Area School District and 2.7 percent for the Albert Gallatin Area School District, Kasunic said.
Rep. Bill DeWeese, D-Waynesburg, said he voted for the budget because it contained a $250 million increase in basic education subsidy without raising taxes and included acquiescence from Senate Republicans on a natural gas severance tax.
“Although the increase in state spending was kept to below 1 percent, the eight school districts in the 50th District will receive subsidy increases of between 2 and 4.97 percent,” DeWeese said. “While there are painful reductions in some other areas, I think most people realize that the magnitude of the state’s billion-dollar deficit necessitated that hard choices be made.”
Kasunic said many residents told him during his re-election campaign this year that they wanted the Legislature to pass this year’s budget on time and not raise taxes.
He called last year’s drawn-out budget stalemate a “101-day debacle.”
The budget proposal does not contain an extraction tax on Marcellus shale gas, but government leaders are supposed to come up with a “severance package” by Oct. 1, he said.
“The governor, the four caucus leaders and the appropriations (committee) chair will come up with a severance package by Oct. 1,” Kasunic said. “Will that happen? That remains to be seen. It’s not set in stone.”
DeWeese said while he would have preferred that the tax rate and distribution formula had been hammered out as part of budget negotiations, the Republican-controlled Senate’s willingness to finally impose a natural gas tax in a few months represented a major breakthrough that could be built upon.
“We simply could not afford to throw the baby out with the proverbial bath water,” said DeWeese. “The challenge now, for those of us in the hotbed areas where gas is being produced in a modern-day Gold Rush, is to ensure that local governments get a fair share of this revenue.”
DeWeese said he will be an aggressive proponent on behalf of municipalities and counties where gas is being drilled, because it is their roads, bridges and water supplies that run the risk of being adversely impacted by this burgeoning industry.
Passing the budget on time was the first priority, but issues such as Marcellus gas, funding for road, bridge improvements and the looming pension fund crisis must addressed, Kasunic said.
Kasunic said he wants to establish a fund to pay for environmental problems and cleaning up after accidents caused by Marcellus gas operations.
Municipalities need help to fix roads damaged by trucks traveling to and from well sites, he said.
The Legislature, Department of Environmental Protection and the gas industry should work together on the package, he said.
“It’s a viable industry,” Kasunic said. “It will provide jobs and fuel the economy for many years to come. We need a partnership to address all needs including protecting the environment and citizens. A package is needed for all concerns.”
The 37-to-13 Senate vote on Wednesday followed less than an hour of debate in which senators described it as a compromise product of difficult financial times. The House voted 117-84 in favor of adoption.
Rendell says he’ll sign the budget, which includes
no new or increased taxes for all Pennsylvania residents, once lawmakers pass legislation specifying how the money is to be spent and a measure authorizing borrowing for capital projects.