Pa. Senate to Take Up House Revenue Proposal For Budget

Brandon Parsons
September 22, 2017

House leaders suggested the downgrade could help bring lawmakers together to address major cost drivers in the state budget. Wednesday's downgrade marked S&P's sixth negative action or statement on Pennsylvania's creditworthiness since 2012.

"The decision by Standard & Poor's to downgrade Pennsylvania's credit rating should come as no surprise". "I have said repeatedly for three years that we must responsibly fund the budget with recurring revenues".

Both the Senate and House are split on whether to raises taxes as lawmakers mull borrowing $1.0 billion or more to bail the state out of a projected $2.3-billion deficit.

He said his administration had worked to hold off a downgrade and that it is time for an immediate resolution. "If an agreement has not progressed by next week, I will be forced to take further steps to manage this situation".

"If the unthinkable happens and there is no agreement by September 30", she said in an interview Wednesday, "I urge the governor to withhold payments to both the Legislature's members and their staff".

Senate Republican leaders and Wolf maintain they're uncomfortable with any budget that doesn't have recurring revenue, like the one the House proposed that aimed to fill much of the gap with fund transfers.

Wolf, who allowed the imbalanced budget to pass without a signature, vowed on Monday that legislatures would agree on a spending plan before October 1.

In the past week, Wolf delayed making more than $1.7 billion in payments, mostly to Medicaid insurers and school districts.

The House rejected any sort of tax increase when it passed its plan. But spending has declined as share of state GDP for the last five years, and the main reason for our structural deficit is cuts to corporate taxes and our upside-down tax system.

House Democratic Leader Frank Dermody of Allegheny County called today's news a blow to the state's fiscal standing, but also an opportunity for everyone to get back to work on a "real budget solution".

"The downgrade largely reflects the commonwealth's chronic structural imbalance dating back almost a decade, a history of late budget adoption, and our opinion that this pattern could continue", said S&P analyst Carol Spain in a press release.

Other reports by AllAboutTopnews

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