June 2011 Column - State Budget Restores Fiscal Responsibility
By Dave Hickernell, state representative
98th Legislative District
For the first time in eight years, a new state budget was in place by the legally mandated June 30 deadline. Over those eight years, state spending increased 31 percent while the rate of inflation grew only 21 percent. State spending was out of control and Pennsylvania was facing a $4 billion dollar deficit. Clearly, difficult choices had to be made to stop this trend of spending money we do not have and expecting taxpayers to make up the difference.
The 2011-12 budget takes a different approach. It spends $1 billion less than the previous year’s budget, marking only the third time in nearly 40 years a state budget spends less than the previous year. Although $2.7 billion in federal stimulus funds have expired and were not available to us, we were able to maintain critical services including a safety net for those truly in need, health care and quality education.
For years, I have said we need to examine state government line by line to determine which programs are working and which are not. This budget begins that process of streamlining and right-sizing state government by eliminating nearly 100 duplicative and non-essential programs. Every program must be open to examination and reduction and the Legislature should be no different. In this budget, $50 million is removed from legislative reserve accounts and used to help fund education.
It is important to note that we accomplish these goals without new borrowing and without increasing taxes on Pennsylvania families or employers. As we continue to struggle through an economic recession, Pennsylvania families are struggling to make ends meet. We cannot ask them to send more of what they earn to Harrisburg so we can keep on spending. Likewise, we cannot make it more difficult for Pennsylvania employers just so we can avoid making the tough, but necessary decisions about state spending. If we are going to get Pennsylvania’s finances in order, we have to make some difficult decisions, even if they are uncomfortable. This budget does just that.
During the House debate over this budget there was some discussion of the higher than expected revenue collections reported by the Department of Revenue. Estimates have put these additional revenues at around $700 million. While that is good news, I do not agree with those who call those funds a “surplus” and see them as an opportunity for us to spend more. In reality, there is no surplus. Those additional revenues pale in comparison to Pennsylvania’s $50.5 billion in outstanding liabilities. These liabilities include $12.9 billion in outstanding debt payments, $29.4 billion in pension obligations, $4 billion owed to the federal government for borrowed unemployment compensation funds, $3.5 billion in road and bridge costs, and $716 million in an MCare judgment. When we have so many obligations which must be met, it would be irresponsible to spend these additional revenues.
We have passed a realistic, responsible, and sustainable plan. It eliminates wasteful spending and closes a $4 billion structural deficit and maintaining critical government services. After years of overspending, overtaxing and borrowing, state government has begun to live within its means.
State Representative Dave Hickernell
98th District, Pennsylvania House of Representatives
Contact: Sean Yeakle