By MARC LEVY and MARK SCOLFORO
HARRISBURG, Pa. (AP) — Gov. Tom Wolf’s eighth and final budget proposal unveiled Tuesday would boost state spending to more than $43 billion for the first time, with the Democratic governor asking lawmakers for the biggest increase aid for public schools, plus more money for direct social workers, colleges and college scholarships.
Wolf presented the $43.7 billion proposal to lawmakers in a joint session of the House and Senate, kicking off nearly five months of wrangling before the fiscal year ends June 30.
One of the features of Wolf’s tenure has been a campaign to eliminate deep funding disparities between the poorest and wealthiest public schools, and he again hopes to persuade the Republican-controlled Legislature to approve a big increase, over $1.5 billion.
In addition to public schools, Wolf wants to increase reimbursements for direct care workers serving the elderly and disabled under Medicaid and raise more money to qualify Pennsylvania for new federal highway and bridge funding.
State universities and scholarship programs would also receive substantial new money, including $125 million for the state’s 14-school higher education system and a $200 million scholarship program for students who frequent there.
Republican lawmakers, however, have long been wary of Wolf’s proposed spending increases, and they have suggested that Wolf’s outgoing offer in budget negotiations was a “fantasy” that even Wolf himself would not sign off on.
After years of stubborn deficits dating back to the recession, state bank accounts are now fueled by an economy fueled by federal pandemic grants, and a multi-trillion-dollar surplus — a mind-boggling $6.5 billion. dollars – is planned for the coming year.
Most of Wolf’s budget proposals have revolved around steep tax increases. However, given the state’s cash cushion, Wolf is not proposing any changes to state income or sales taxes this time around, the state’s two main sources of revenue.
In total, Wolf’s plan would increase spending through the state’s main bank account to $43.7 billion, about 13% more than the budget passed this year of $38.6 billion.
However, federal pandemic assistance has reduced the state’s reliance on Pennsylvania taxpayer money for the current year. Including $3.5 billion in federal pandemic assistance, spending on state operations is expected to be about $41 billion this fiscal year.
In his speech, Wolf said it was time to deliver on the promise of fair funding for public schools, a major commitment the state can afford to meet now.
“It’s one of those cans that would be really easy to throw on the road,” Wolf said. “We could make it someone else’s problem, we could leave it to another governor or another legislature to solve it. But we know better. We know that postponing the inevitable doesn’t solve the problem. The truth is, the longer we go without paying that bill, the more it will end up costing us.
Wolf also called for an increase to Pennsylvania’s lowest minimum wage – something Republican lawmakers have resisted since he took office in 2015 – and to cut corporate taxes by returning Pennsylvania from its rate. 9.99% tax on corporate profits, the second highest in the nation.
Wolf, who is constitutionally required to leave office next January at the end of his second term, boasts that he is the only governor since Republican Dick Thornburgh in 1987 to leave a cash surplus for his successor.
Still, some of the surplus will be needed to fill the void left by billions in federal pandemic aid that pays states’ Medicaid bills this year.
Republicans have warned that the state is still in a long-term deficit cycle, given that it is a relatively slow-growing economy with a booming retirement-age population and a growing population. declining working age.
Soaring tax collections right now simply mask a long-term deficit that will reappear more quickly if the state spends billions of its surplus dollars, they said.
Senate Appropriations Committee Chairman Pat Browne, R-Lehigh, warned that Wolf’s budget numbers “do not reflect history and do not reflect reality.”
House Majority Leader Kerry Benninghoff, R-Center, called Wolf’s spending plan “obscene” and Senate Pro Tempore Speaker Jake Corman, R-Center, called it ” fantastic island”.
Democrats, however, echoed Wolf’s message that now is the time to take advantage of the huge surpluses to invest the money in a long-term good that will help the state in the future.
“This is about investing in people, funding our schools so property taxes go down, and making Pennsylvania a more business-friendly Commonwealth,” said House Minority Leader Joanna McClinton. D-Philadelphia.
Sen. Vince Hughes of Philadelphia, the ranking Democrat on the Appropriations Committee, said he was encouraged by Wolf’s continued focus on education spending.
“I think the big news today is education funding,” Hughes said. “I think the big news today is that we have the surpluses available to us to pay for it.”
Follow Marc Levy on Twitter at https://www.twitter.com/timelywriter and Mark Scolforo at https://www.twitter.com/houseofbuddy.