Thursday, October 22, 2009

Schroder: Without Reform, New Budget Ensures Problems Next Year

Veteran Chester County state lawmaker Curt Schroder would like to be a Congressman next year, but he's still working toward reforming the Pennsylvania Legislature. His latest op-ed on changes that need to be made in Harrisburg:

Without Reform, New Budget Ensures Problems Next Year

By State Rep. Curt Schroder

Why did it take so long to pass the budget? What was the fundamental area of disagreement? Quite simply, were we going to increase taxes and add more spending in a bad economy or require state government to live within its means, just like Pennsylvania's families must do? I and several colleagues argued for the latter. Unfortunately, the end result looks more like the former.

It is important to understand that the budget could have been passed on time if the General Assembly would have caved to the governor's demand for higher income and sales taxes. This was not acceptable, particularly in a bad economy. The budget that eventually passed, however, is sure to preserve the same structural imbalances that created the crisis in the first place.

The budget relies on new taxes, stimulus funding and other one-time revenues such as the Rainy Day Fund and the Health Care Provider Retention Account. For the first time, we even dipped into the principal reserves of the tobacco settlement fund. Still, in order for the ledgers to balance, we must depend on inflated revenue projections.

Last year a similar approach was used to pass the budget. Yet, billion dollar deficits were predicted, and I joined 31 of my House colleagues in voting against that budget. By year's end, we were facing a $3.2 billion deficit.

House Republicans proposed a budget with modest reductions that funded essential state services and did not raise taxes. House leadership refused to consider the plan. Instead, the budget that was eventually cobbled together in the backrooms of Harrisburg raised taxes by more than a billion dollars in the midst of a terrible recession. The details of the budget "deal" were kept from rank-and-file members for weeks. Once a bill finally came to the House, rules requiring 24 hours to review the bill were ignored and broken.

I opposed the budget and the methods used to pass it without adequate time for review. I am glad we were able to defeat proposals to raise the personal income tax, sales tax, an arts tax and a tax on small games of chance. However, taxes on business were raised, as were taxes on consumer spending.

The public is understandably frustrated with the time it took to pass this budget. Only one other budget in recent history went as late as August. Prior to Gov. Ed Rendell, neither the party of the governor nor the General Assembly has ever been a barrier to passing budgets. We can expect more of the same next year. Revenues are already $140 million below projections and the Rainy Day Fund is dry so no cushion exists to help us through.

I will be proposing legislation to ensure that a budgetary shut down does not occur again. If a budget is not signed into law by June 30, the budget in effect should roll over into the next fiscal year minus a percentage to reflect any deficit that might have occurred. This approach will ensure needed services are provided, state employees are paid and the public is not held hostage to unreasonable budget demands.

No comments: