Legislative Leaders Announce Budget Agreement

Here's the press release put out today by Pennsylvania legislative leaders announcing a budget agreement 73 days into the new fiscal year:

HARRISBURG – A bipartisan group of legislative leaders today announced an agreement in principle on the 2009-10 state budget.

Leaders from the Senate Republican, House Democratic, and Senate Democratic caucuses said that the agreement calls for the adoption of a $27.945 billion spending plan with no broad-based tax increases. It uses a combination of one-time revenues and recurring revenues to produce a balanced budget for 2009-10 which maintains adequate funding for core government services and provides key investments in basic education.

"Given the state of the economy, a lot of difficult choices had to be made in this budget," said Lt. Gov. Joe Scarnati. "However, we were able to come to an agreement that meets our core principles of no broad-based tax increases, a budget that spends less than last year, and one that is sustainable. Senate Republicans said from the beginning that we were willing to negotiate as long as those parameters were met, and as a result we have a final document that recognizes the fiscal realities of Pennsylvania taxpayers."

"This budget is far from perfect, but Democrats and Republicans alike are coming together in order to end the pain that hundreds of thousands of people are feeling," said House Speaker Keith McCall. "I am encouraged by the progress we have made in recent days. The people of Pennsylvania deserve an end to the uncertainty, and, with a continued spirit of teamwork we will make that happen."

"The people of Pennsylvania have told us clearly that they want us to find the middle ground, and this agreement represents the middle ground," said Senate Majority Leader Dominic Pileggi. "This is not the budget we would have written if our caucus had total control, but it is time to resolve our differences and come together on a final budget."

"I felt strongly that compromise and good faith negotiating could finally bring about a fair and balanced plan," said Senate Democratic Leader Robert Mellow. "This deal sees us through for two years to prevent a similar situation next year, and it also protects education funding which was critical to any deal. We made sure county programs for child welfare, hospitals, and community and economic development got significant attention. At the end of the day, this is a deal with which Pennsylvanians can feel comfortable."

"This plan keeps our commitment to protecting our children, seniors, veterans, the disabled and our most vulnerable citizens, while also investing adequately in basic education," said House Majority Leader Todd Eachus. "This is a true compromise, and it’s the beginning of our bipartisan effort to resolve the very serious budget deficits we face today, next year and the year after."

"This agreement reflects and responds to the toughest economic climate Pennsylvania has seen in decades," said Senate Appropriations Chairman Jake Corman. "This balanced budget spends less than last year and, most importantly, drives additional education dollars to our local schools without imposing any broad-based tax burdens on our hard-working families. By taking a responsible approach to addressing the Commonwealth’s $3.2 billion deficit, we have put Pennsylvania on the right path to move forward as the economy improves."

"The deal we have reached truly reflects our efforts to meet in the middle," said Senate Democratic Appropriations Chairman Jay Costa. "It was a thorough and exhaustive process, and we were very careful about making sure that programs which serve vulnerable Pennsylvanians were represented in this plan. The final result is a fair budget plan that is balanced and sound."

Among the revenue sources included in the plan are a slowdown in the phase-out of the Capital Stock and Franchise Tax, the introduction of table games at Pennsylvania’s casinos, and a 25-cent per pack increase in the cigarette tax.

The agreement also taps the state's Rainy Day Fund and will transfer an existing surplus in the Health Care Provider Retention Account to the General Fund.

Work will continue through the weekend to draft the legislation necessary to enact this agreement. The plan could be voted on in both the House and the Senate as early as next week.