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LEHIGH VALLEY WEATHER

Pa. budget receives mixed reviews from politicians, organizations

The 2016-17 state budget, which was recently approved by Gov. Tom Wolf and the legislature, arrived July 13. Though the budget arrived reasonably on time - with no shades of last year’s infamous budget gridlock that paralyzed the state for nearly nine months - there, of course, were many compromises and controversies.

The budget will spend approximately $31.6 billion, which is a 5-percent increase from last year’s budget. The increase in spending is in part due to mandatory payments for the pension and corrections systems as well as Medicaid.

The $1.5 billion increase marks the largest to the state’s budget since 2006.

The finalized budget plan cuts roughly $2 billion from the original plan Wolf proposed in February. Despite this reduction, the state still needs to raise more than $1.28 billion in new revenue to cover the increase.

The state will get the additional funds by allowing the sale of alcohol in grocery stores, expanding gaming, increasing taxes on tobacco and expanding the sales tax to include digital downloads.

School districts will reap the benefits of this new budget, getting $200 million to fund basic education and a total of $50 million more for special education, prekindergarten and head-start programs.

This marks a win for Wolf, who said he has championed the expansion of education from the outset of his term.

A total of $15 million will be spent to combat the state’s addiction crisis, another core value of Wolf’s tenure.

Though the streamlined process has undeniably prevented another wave of apprehension that dominated last year, reactions have been mixed toward the new budget. State Rep. Julie Harhart, R-183rd, was generally pleased, she said.

“This budget may not be as ‘lean’ as I would have perhaps wanted, but with any large undertaking, there were needed compromises along the way,” she stated in a recent press release. “I am pleased we were able to significantly reduce the amount of money the governor originally wanted to spend and were able to take any broad-based taxes off the table.”

State Rep. Justin Simmons, R-131st, was initially in favor of the budget. However, he later voted against it, citing the revenue package presented to the House of Representatives was different than what was agreed upon during the vote.

“[The budget] makes significant changes to how Pennsylvania has always treated the business community in its role as our partners in tax collection by eliminating the vendor discount on collected sales tax. It unfairly targets smaller community banks - a group that is key to the continued growth of entrepreneurship in our state and new jobs in our communities.

“The package also relies on unwise borrowing to fund spending, and I believe that is not a responsible path. These are just some examples of items that changed from the original revenue proposal and that forced me to vote no.”

Organizations across the board have taken issue with the increase to the budget.

Nathan Benefield, vice president of policy for the Commonwealth Foundation, sees the budget as a largely flawed document that overspends without reforming the spending process. A press release from the Commonwealth Foundation outlines five major areas the organization takes issue with, including unsustainable spending growth and leaving the poor vulnerable to tax hikes.

“The budget ... spends far more than the state can afford while not taking the critical steps needed to address today’s wasteful spending,” Benefield stated in the release. “Ultimately, these kinds of spending increases will demand more from Pennsylvanians’ paychecks - forcing hardworking taxpayers to sacrifice their family budgets for unnecessary state spending hikes.”

On the opposite end of the spectrum, other groups believe there is not enough spending going on. One such group is the Pennsylvania Health Care Association. Its president and CEO, W. Russ McDaid, issued a statement July 14 deriding the lack of Medicaid funding in the budget: “Pennsylvania’s Medicaid program still does not come close to covering the real cost of care. Nursing facilities received flat funding in this year’s budget, which leaves Pennsylvania’s frailest and sickest residents … vulnerable.

“Without adequate funding moving forward, some facilities may have to turn away seniors on Medicaid because they cannot afford their care, creating … issues in parts of the state.”