Jun 27, 2008 3 min read

State law requires Pennsylvania to have a new budget in place by July 1, the start of the fiscal year, but don’t hold your breath that the Legislature will break with recent tradition and have that document finalized on time. State law requires Pennsylvania to have a new budget in place by July 1, the start of the fiscal year, but don’t hold your breath that the Legislature will break with recent tradition and have that document finalized on time.

There’s still some time, and anything can happen, but judging by some of the moves last week we’re in for more of the same.

In the state House, which Democrats control by a one-vote margin, Republicans failed in an effort to have the entire state workforce – 25,000 strong – declared “critical.” That designation would exempt all state workers from possible furlough if the budget isn’t done on time.

State Rep. John Perzel, R-Philadelphia, benignly explained the effort as, “All we’re trying to do is to avoid laying off 25,000 workers and taking away their ability to feed their families.” Perhaps Perzel should explain, then, why the worker-minded GOP didn’t undertake this initiative during the dozen or so years when they controlled the chamber, a period that included his own reign as Speaker of the House.

Since the House Republicans did nothing to power through such protective legislation when they were in power, it’s pretty easy to dismiss their attempt to do so now as an election-year ploy.

Current House Majority Leader Bill DeWeese, D-Waynesburg, had the right priority in noting, “We should solve the budget problem today or tomorrow or the next day, and then there will not be any furloughs.”

Also this week, the Republican-controlled state Senate approved a $240 million tax-cut package that aims to help the working poor by increasing the state income tax forgiveness limit over a three-year period.

By year three, for example, a couple with two dependents making up to $37,000 would be exempt from paying the state’s 3.07 percent income tax.

But the current forgiveness limit for a couple in that same scenario is $32,000.

And if this is not another gimmick, what type of tax relief are Senate Republicans offering everyone else who earns an income? They suffer from the same escalating gasoline and food prices, too.

The Senate Republican package also offers long-term incentives to businesses to invest in Pennsylvania. That sounds reasonable. But it would also hike the cap on losses that business could carry forward from 12.5 percent or $3 million to 20 percent or $5 million. And it would adjust the way the corporate net income tax is calculated in order to help businesses that have employees or assets in the state.

Democrats maintain the tax cuts are too much in a lean budget year that could see a revenue shortfall. That, too, is a worthy consideration.

We’re likely to see more contention than consensus.