A prolonged state budget impasse could jeopardize programs –– but state Rep. Martin Causer says the House of Representatives is diligently working on a proposal to fund the state spending plan.
In the meantime, a total of $860 million in payments from Pennsylvania hang in the balance, State Treasurer Joseph Torsella announced earlier this week. On Friday, Pennsylvania’s general fund could fall to zero.
In a joint letter to Gov. Tom Wolf and members of the General Assembly, Torsella and Auditor General Eugene DePasquale outlined how the state’s general fund is unable to meet expenditure demands. Torsella said he is reluctant to borrow money from the treasury’s short-term investment pool for Sept. 15.
“It is the constitutional responsibility of the legislature and the governor to enact a balanced budget by July 1,” Torsella said. “My obligation as treasurer is to make only prudent investments of the funds under our care, not to enable continued budgetary dysfunction and a chronically unbalanced budget by providing emergency overdraft protection to the general fund.”
State Rep. Matt Gabler, R-DuBois, disagrees.
“Our ongoing budget situation will certainly require a legislative solution by April or May, but we should not be fooled by a fake September crisis conjured by this administration in their quest to increase taxes on hard-working Pennsylvanians,” he said.
The goal is to adopt a plan that has a minimal effect on taxpayers, Causer, , R-Turtlepoint, said. For weeks, lawmakers and Wolf haven’t been able to agree on how to balance the budget.
“The fiscal situation that our commonwealth is facing because of not having a completed budget is certainly troubling,” said state Senate President Pro Tempore Joe Scarnati, R-Brockway. “At this point we continue to wait for the House of Representatives to take action to vote on legislation to fund the budget and end the impasse.”
As of Tuesday, treasury spokesman Heidi Havens said the treasury department could not provide a complete listing of payments that could be held up, as more funding could filter in.
“What we can share is that we are in daily contact with the governor’s office of the budget providing that office with updates on the general fund balance,” she said. “Ultimately, the office of the budget will make the call on which payments are held, and which payments are made.”
Torsella OK’d a short-term, two-week $750 million line of credit from the treasury’s short-term investment pool to the commonwealth’s general fund from Aug. 14-23. The loan was released in full to the general fund Aug. 15 and was repaid Aug. 23 at an interest rate of 85 basis points.
“The general fund account often runs low during the year because tax revenues are not received all at once,” Gabler said. “Other accounts under the state treasurer’s management are routinely utilized to keep government operating during the course of the year until sufficient tax revenues are received. Any decision not to do so would be on the hands of Gov. Wolf and Treasurer Torsella.”
Wolf moved in August to protect local school districts so schools and children would not suffer from the House’s “lack of action on being fiscally responsible,” J.J. Abbott, spokesman for Wolf, said.
“As Gov. Wolf has said, a failure to complete the budget and cover the $2.3 billion deficit would force the commonwealth to run out of money and jeopardize funding across government,” Abbott said. “At this time, we are still evaluating all options should the House Republicans fail to act responsibly to complete and balance the 2017-18 budget. The easiest and most responsible option continues to be urgent House action to fund the budget that they passed overwhelmingly in June.”
State Rep. Matt Baker, R-Wellsboro, could not be reached for comment by press time.
