The Pennsylvania state budget is a mess – a mess taxpayers are paying for.
For years now, lawmakers and governors have overspent, played shell games, and used budgetary gimmicks to avoid decisions about responsible spending and taxing policies. It’s time to change course, and put our state on a long-term, sustainable fiscal track. That should begin by adopting the Taxpayer Protection Act.
It has taken a long time for things to get as bad as they are. According to the nonpartisan Commonwealth Foundation, the population of Pennsylvania grew by 10.2% between 1970 and 2020. State spending per family, however, more than tripled during that time. That figure is adjusted for inflation, so the incredible spending increase represents real dollars, paid for by Pennsylvania workers.
Are families getting more than three times the services they received from the state 50 years ago? It sure doesn’t seem that way. Instead, a great deal of taxpayer money is being wasted.
While spending has been surging, so have tax revenues. According to the latest data, general fund and overall state tax revenues are on the rise this year – again surpassing projections. That steady flow of increasing revenue – boosted by too many tax increases on working families – should make it easier to manage the budget in a responsible way.
But that’s not the path Pennsylvania is taking. No matter how much Harrisburg raises our taxes, it’s never enough to keep up with the spending. This combination of bad management, high taxes, and out of control spending are damaging our economy and hurting families whose hard work built our great state.
According to outside analysis, including the nonpartisan Volcker Alliance, Pennsylvania has not consistently made actuarially required contributions into public worker pensions, repeatedly used a variety of budgetary shell games to mask persistent deficits, issued bonds to cover annual costs, and experienced a “chronic shortage of cash” despite constantly increasing tax revenue.
If responsible government means crafting an honest and transparent budget and sticking with it over time, Pennsylvania fails miserably. Ours is the only state to receive the lowest possible grade five years running (2015-2019) on the Alliance’s annual budget report card.
And things are not on track to get any better. Pennsylvania’s Independent Fiscal Office projects that general fund revenues will increase from $32.3 billion to $42.3 billion in the six years ending in 2025, but also anticipates annual deficits exceeding $2 billion going forward.
The conclusion is unavoidable: Our state has a spending problem and must begin to live within its means and within a properly constructed budget. The Taxpayer Protection Act will help make that possible.
This common-sense legislation would amend the state constitution to include a fiscal limit to cap the growth of general fund spending based on population growth plus inflation. Spending beyond this limit would still be allowed, as long as it is approved by a supermajority of the Legislature. These changes would bring fiscal discipline, while still allowing the state to respond to genuine emergencies or radically changing circumstances. When the Legislature meets in the weeks ahead, House Majority Leader Kerry Benninghoff (R-Lebanon) should schedule the bill for a vote.
To protect taxpayers, grow the economy, and foster job creation, Pennsylvania needs spending restraint and smart budgeting. That means cutting waste, budgeting honestly and with transparency, and reforming the tax code to allow people to keep what they earn.
Lawmakers can begin to take those steps now.
The first duty of our elected representatives is to act as responsible stewards of our taxpayer dollars. That being the case, as legislators return to Harrisburg this measure ought to be a top priority. It marks the first step toward making Pennsylvania a model of sound fiscal management, instead of a clear example of what not to do.
Ryan Warner is a member of the Pennsylvania House of Representatives representing Fayette and Westmoreland counties. Ashley Klingensmith is State Director of Americans for Prosperity-Pennsylvania.