Wednesday, March 31, 2010

PA $750M in the red, Rendell in denial

The Pennsylvania Department of Revenue is expected to announce on April 1 that March tax revenues are expected to come in $273 million below the official estimate.

Pennsylvania is expecting a year-to-date budget shortfall of $750 million for the current fiscal year, which ends June 30. The state ran up a $3.25 billion deficit in the previous budget year.

Despite the ocean of red ink, Gov. Ed Rendell is in full-blown spin mode.

"With the significant revenue month of April just ahead, it is important to wait and see how the major tax category collections come in before we make assumptions about end-of-year revenues," Rendell said. "At this point it would be premature to deviate from the plan that I have already presented to balance the budget.

Republican lawmakers are more realistic about the state's fiscal woes.

From The Associated Press:
A top Republican state senator says Pennsylvania's budget situation is worsening and says it's reasonable to expect a $1 billion deficit by July 1.

Senate Appropriations Committee Chairman Jake Corman said Wednesday that disappointing March tax collections are likely to bring the state's fiscal year shortfall to at least $700 million.

With three months to go in the fiscal year, the Centre County Republican says a $1 billion deficit, or more than 3 percent, is possible.

Corman says Democratic Gov. Ed Rendell should consider additional cuts in this year's budget.

However, Rendell said in a statement responding to Corman that a balanced budget is still within reach since April is also a big month for revenue.
He says it is important to wait before making assumptions.
Denial is a river that runs through Harrisburg.

Read Rendell's full statement at the link below:

Balanced Budget Still Within Reach Despite Weak March Revenues

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