STATEMENT: On the IFO Release of the Five-Year Economic and Budget Outlook

HARRISBURG — The Pennsylvania Budget and Policy Center released the following statement from Director Marc Stier regarding today's release of the Independent Fiscal Office’s (IFO) Five-Year Economic and Budget Outlook for Pennsylvania:

"The Independent Fiscal Office’s (IFO) Five-Year Economic and Budget Outlook, which was released today, confirms warnings we have been giving since July. While the state’s General Fund budget for the current year was balanced, it relied heavily on one-shot revenues and borrowing on the Tobacco Settlement. The previous two state budgets did the same thing. And the bills for paying for necessary state expenditures with one-shot revenues and borrowing are coming due.

"The IFO predicts that the budget deficit for fiscal year 2019-2020 is likely to be between $1.5 and $1.7 billion. And, perhaps even more importantly, closing this projected budget deficit will still leave the state with a huge investment deficit. It would leave us with the most unequal funding of K-12 education in the country. It would leave us fourth from the bottom of all states in funding higher education. It would leave us with roads and bridges in a state of disrepair. And it would leave us with inadequate protection of our environment.

"And the root of our continued budgetary shortfalls is one of the most unfair, upside-down tax systems in the country in which the top 1% pay a lower share of their income in state and local taxes than the middle class. That fact points to the solution to both our budget and investment deficits. It is time for Pennsylvania to raise substantially more revenue without taxing the middle class more. It can do that by adopting the Fair Share Tax Plan, by closing corporate loopholes, and by enacting a severance tax."