Budget Omnibus: Pa. House Passes Cigarette Tax
Lots of moving parts to the state’s budget situation these days, so let’s try to take them in some semblance of order.
• First: The Pennsylvania House on Wednesday night authorized Philly’s cigarette tax, a measure designed to help fund city schools at something like full strength. “The state House of Representatives voted 119-80 on Wednesday night to send the bill back to the Senate, which approved a similar version earlier this week,” AP reports. “Philadelphia officials say that imposing a $2 per-pack city tax on cigarette sales will help fill a crippling schools budget deficit. Without the money, they say schools won’t be fit to open in the fall.”
• Second: There’s the matter of the $29.1 billion budget passed earlier this week by the Pennsylvania Legislature. It has no pension reform measure in or accompanying it, despite Gov. Tom Corbett’s demands. So he’s now playing a game of chicken:
“Pennsylvania Governor Tom Corbett on Wednesday would not rule out a budget veto if state lawmakers fail to enact reforms for the state’s underfunded public pension system,” Reuters reports. “He said at a press conference that he is still reviewing the spending plan. When asked whether he would veto the bill without pension reform legislation, he said that ‘all options are on the table.'”
The House on Wednesday did pass the Fiscal Code.
• Third: On Wednesday we asked what Democratic gubernatorial nominee Tom Wolf would be doing if he were in charge of this budget mess. Later that day, the former state revenue secretary stepped away from his recent silence and offered an answer.
Wolf said he would balance the budget by imposing a 5 percent severance tax on natural gas drilling, expanding Medicaid under the 2010 federal health care law and closing tax loopholes.
“I think those three things would take us a very, very long way with bridging this immediate budget gap that we have right now,” Wolf said.
He predicted that if Corbett signs the budget it will serve to increase next year’s deficit, but stopped short of saying he should veto it.
“Whoever the next governor is, is going to have to work through the consequences of a budget that doesn’t have adequate revenues and adequate thought isn’t being given to how the money is being spent,” he said.
Wolf was silent on one issue, though: He wouldn’t tell AP whether or not he supports Philly’s cigarette tax measure — but did say the effort was an “unfortunate consequence” of the way the state funds schools.
