HARRISBURG – State revenue demands…
HARRISBURG – State revenue demands drive a fresh look at a trio of initiatives that Gov. Tom Corbett pushed for all last year but could not get over the finish line.
Senate and House Republican leaders cited the potential of new revenue for state programs last week as they discussed legislation to:
– Reduce public pension costs.
– Privatize the state-owned liquor stores.
– Expand gambling for the Pennsylvania Lottery while creating a larger private-sector role.
Sen. John Yudichak, D-14, Nanticoke, a member of the Senate Appropriations Committee, called the attention to these initiatives a diversion from the core issue creating fiscal problems: lagging job growth in Pennsylvania.
He said the governor should focus on job creation rather than on divisive ideological issues.
The fiscal problems facing Pennsylvania this year won’t be easy to solve. Lawmakers must pass a new state budget balanced between revenue and spending by June 30. Yet the governor’s budget office forecasts $1.7 billion in additional costs in fiscal 2014-15 and not enough tax revenue to cover them.
Mr. Corbett plans to deliver his fourth budget address on Feb. 4. Lawmakers start budget hearings the following week.
Senate President Pro Tempore Joseph Scarnati, R-25, Jefferson County, drew the closest connection between the state budget and action on one of the above issues.
He urged his colleagues to take the lead in addressing skyrocketing pension costs like they did with passage last fall of the $2.3 billion multi-year transportation package. Lawmakers can either bring the pension system for state government and public school employees in line with the private sector or cut state programs to pay for higher pension costs, Mr. Scarnati said.
“This must be one of our first priorities,” he added.
House Majority Leader Mike Turzai, R-28, Pittsburgh, favors moving new public employees into a defined-contribution pension plan rather than the traditional defined-benefit plan.
The next state budget must absorb a $500 million spike in state payments to cover school district employee pensions and $110 million spike for state government employee pensions, according to Budget Secretary Charles Zogby.
Closer to Mr. Turzai’s heart is a new round of talks aimed at bridging differences between the House and Senate Republicans over liquor divestiture.
Mr. Turzai suggested that licensing fees from newly created private liquor licenses would provide new revenue for the next budget. He steered a groundbreaking bill through the House last year that would create 1,200 private wine and spirits retail licenses over four years.
Lt. Gov. Jim Cawley heads the effort to find out where caucus leaders can agree on creating a larger role for the private sector in liquor sales and expanding consumer choice and convenience.
“What that brings in revenue will depend on those areas (of agreement),” said Cawley spokesman Chad Saylor.
Senate Majority Leader Dominic Pileggi, R-9, Chester, said the votes are currently lacking in his caucus to pass a bill auctioning the state stores to private bidders.
“There is just not support for that broad of a change,” he added.
Mr. Pileggi cautioned against selling state-owned assets just to plug a revenue hole to cover one year’s budget and not weighing the impact on future budgets.
Meanwhile, the senator is trying to develop support for a proposal to boost lottery revenue by adding keno, creating a larger private-sector role in the lottery and providing a school property tax freeze for senior citizens.
While Mr. Corbett recently ended a proposed bid agreement to have a British firm manage the lottery, he said he’s still seeking ways to grow lottery revenue.
“The need and demand for these (lottery) programs will continue to outpace the ability to pay for those programs,” said Corbett spokesman Jay Pagni.
Senate Democratic Appropriations Chairman Vincent Hughes, D-7, Philadelphia, warned that the lottery could be undermined by GOP lawmakers desperate to find solutions to state fiscal problems.
Contact the writer: rswift@timesshamrock.com
Robert Storm
Eastern Region Vice President
www.pscoa.org