Tax and Budget

The General Assembly has begun working on the budget for 2018-19 based on Governor Wolf’s budget proposal. So, this is a good time to look at the governor’s proposals in light of the recent history of funding for education in our state.

Governor Wolf’s budget would finally restore (in nominal dollars) the deep cuts to K-12 classroom funding made by Governor Corbett in 2011-12, which is a noteworthy accomplishment. However, inadequate funding and deep inequities still remain in our school funding system. Also, Governor Wolf continues to prioritize early education funding. His proposal this year, if enacted, would nearly double Pre-K funding since 2014-15. A signature focus of Governor Wolf this year is a substantial investment in Career and Technical Education and workforce development, with the aim of providing high school and post-secondary youth with critical STEM and other technical skills that can lead to good paying jobs.

While the details are different, the basic theme of our analysis of the governor’s budget proposal this year is essentially unchanged from last year and the year before. Once again, Governor Wolf has presented another austere budget that, within the political limits of Harrisburg, makes progress on issues critical to Pennsylvanians. But because of those political limits – and through no fault of the governor – it does not make fast enough progress.

Last year, Mayor Jim Kenney boldly called for the School Reform Commission (SRC) to be disbanded and for control over our schools to be returned to the city. In doing so, he took on the responsibility to pay for schools at a time when growing deficits are expected over the next five years. 

We at PBPC have long argued that the education of Philadelphians shouldn't be a responsibility of the city alone. Not just Philadelphia but the entire commonwealth suffers because the state share of education funding has fallen from almost 50% to less than 35% of total funding.  

Marc Stier, Director of the Pennsylvania Budget and Policy Center, made the following statement following the release of the Trump Administration's proposed federal budget for FY 2019:

 

Gov. Tom Wolf presented his 2018-19 State Budget Proposal on February 6th, 2018.  The Pennsylvania Budget and Policy Center will be posting analysis, infographics and related documents on this page as they become available. Check back often for the latest updates.

In the past several months, Pennsylvania’s legislature has shown renewed interest in enacting a severance tax on natural gas extraction as part of the state’s overdue revenue package to fund the state budget. In that context, the natural gas industry has maintained a steady drumbeat of communications claiming that Pennsylvania already has a tax on gas extraction because of its per well impact fee which does not rise with the volume or value of gas drilled. The industry and its allies also continue to claim that Pennsylvania’s impact fee amounts to a tax that is higher (relative to the volume or value of gas produced) than the severance taxes in many other states.

Marc Stier, Director of the PA Budget and Policy Center, made the following statement following the announcement of a credit downgrade for the state of Pennsylvania:

"The decision by Standard & Poor’s to downgrade Pennsylvania’s credit rating should come as no surprise. There was ample warning by S&P and other credit agencies, as well as by political observers including us at PBPC, that this would be the result of the continuing failure of Republicans in the General Assembly, and especially Speaker Turzai and his followers in the House, to raise sufficient recurring revenues to close state’s long-term structural deficit. Instead, year after year, budgets passed with Republican majorities have been balanced with one-year revenues, phantom funds, and other budgetary gimmicks.

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