Gov. Tom Corbett presented his budget proposal to both houses of the state legislature Tuesday and, as expected, it reflects the state’s difficult financial situation.
There are plenty of cuts to address the state’s revenue shortfall, but it does not include any tax increases. In fact, Corbett said he would work with lawmakers on the budget but said tax increases were not an option.
Early Tuesday morning, philly.com reported that aid to state universities would be cut 20 percent to 30 percent, which Corbett confirmed early in his speech. State-related universities Temple, Penn State, Pitt and Lincoln would see aid cut 30 percent while other state system schools would see aid cut 20 percent under Corbett’s plan according to PennLive.com's Twitter feed. Community colleges, such as Delaware County Community College, would see a 4 percent decrease in funding.
PennLive.com also determined that if the legislature passes the plan as is, Penn State would have seen its aid cut 50 percent in the first two years of Corbett’s administration. Corbett asked for a moment of silence for Joe Paterno.
What the Budget Means for Marple Newtown Schools
Closer to home, aid to local school districts would increase about 3 percent, but most of that increase would go toward funding pension obligations. In effect, aid would remain at last year’s levels.
The Marple Newtown School Board adopted a preliminary budget last month, which calls for a 2.67 percent tax increase for the 2012-13 school year. At a Budget and Finance Committee meeting on Tuesday night, Marple Newtown officials discussed Corbett's budget address and were wary about the "good news" of no cuts.
"We've been trying to digest what it means," said Joe Driscoll, Marple Newtown School Board business administrator. "When you read the headline, it looks good–education is going to get level funding."
However, Driscoll remained skeptical and explained that the state is proposing to take three of the school district's largest subsidies–$2.4 million in basic education; $1.3 million in transportation; and $1.2 million in FICA (Federal Insurance Contributions Act)–from their preliminary budget and combining it into one line item. According to Driscoll, social security is based on 50 percent of the employer's cost of social security just like retirement.
"I think what they're doing here is that they're combining all three of those line items under the guise of reducing confusion and red tape, and giving the school districts all one lump sum of money and calling them educational block grants," said Driscoll.
The upside to Corbett's budgeted numbers: higher numbers than what the district had intended to budget for, which is "good news."
"The bad news is that what I think they're doing is they're lumping those in together to basically say the state is giving this amount of money based on the '11-'12 budget year, and it's never going to change," said Driscoll. "So, as salaries rise and the employer's cost of social security rises, the state's 50 percent share is going to get smaller and smaller and smaller."
State Employees Largely Spared
State employees are largely spared under the proposal, which shows about 650 jobs being eliminated, mostly through attrition. In addition, no state police stations will be closed and the budget includes a class of 115 new cadets.
Unlike last year, Corbett did not discuss selling the state’s liquor stores.
Corbett quoted former presidents Franklin D. Roosevelt and Ronald Reagan to support his plan to “right size” the state’s welfare system. He quoted FDR’s third state of the union speech – “To dole out relief in this way is to administer a narcotic, a subtle destroyer of the human spirit” – and used a portion of a 1982 Reagan speech – “Big government has a way of spending all the money it can get its hands on, and then some. Not only does this excessive taxation put a ball and chain around our economy, it simply does not solve our spending problem.”
His plan to “right-size” welfare includes some work requirements for 30,000 recipients and new eligibility rules.
Corbett also quoted President Barack Obama on his plan to cut back on state funding of universities and threw out a Teddy Roosevelt quote near the end of his address.
State Rep. Tim Briggs (D-149) released a statement Tuesday saying Corbett's budget "puts pain on working families."
"The state should restore fairness to our tax system by collecting millions of dollars in lost revenue caused by tax loopholes for major corporations," Briggs said in the statement. "It should tax smokeless tobacco and enact a real severance tax in Pennsylvania – not the mockery of a bill that was passed today. The state should demand greater efficiency from our government, cut truly wasteful spending and maximize our revenues. "
State Sen. Daylin Leach (D-Delaware/Montgomery)'s statement echoed the sentiment of Briggs', saying the proposed plan would force "students and families to bear the burden of the governor's refusal to bring in additional state revenue."
Comment from State Rep. Mike Gerber (D-148) was not immediately available.