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No Breakthroughs on Budget Talk

With less than two weeks remaining until the June 30 budget “deadline,”  and discussions continuing among House and Senate leaders and the Governor’s Office, no breakthroughs appear imminent, and GOP leaders have signaled that without a significant change in negotiating positions, they may work together to pass a balanced budget and put it on the Governor’s desk on June 30. 

Gov. Wolf’s budget negotiators continue to emphasize their three priorities: funding schools with a severance tax; eliminating the structural deficit with sustainable revenues; and reducing property taxes.  And his spokesmen continue to maintain that “the status quo is unacceptable and we have to change the way state government operates.”

Republicans say the governor’s position is unworkable and unrealistic. The Governor’s ongoing tour of schools to focus attention on education funding has raised the issue of need across the commonwealth, but generating support from affected audiences doesn’t translate into votes in the General Assembly.

Right now, the governor’s position, at least from the perspective of legislative Republicans, has impeded progress toward an agreement, even after several meetings between legislative leaders and Wolf.

They characterized the meetings as being “discussions about having discussions.”

After more than three weeks arguing about the size of the deficit, negotiators are close to aligned on numbers after early week meetings. New reports said the parties all agreed that the deficit was $1.2 billion, but Senate leaders told ERG they thought the number would be closer to $900 million, and the Governor’s Office maintained that the number would again be more than $2 billion in 2016-2017.

Still, contrary to soundbites from the spokesmen and women for the state’s leaders, the officials themselves have maintained largely civil attitudes, and have not walked away from the table.

Republicans continue to push for liquor and pension reform as prerequisites for the rest of the budget. Wolf continues to push for a severance tax on natural gas as a prerequisite for other discussions. Republicans want to get funds from these two issues, and then figure out how to fill the remaining hole in the budget. Wolf wants to get agreement on more funding for public education before any agreement can be finalized.

ERG will provide updates as budget matters change in the next 10-14 days. That information will be shared on the ERG website here.