Gov. Corbett Gives Pension, Liquor Ultimatum, Does Not Rule Out Severance Tax

Gov. Corbett this week made a “request” that the Senate and House do meaningful pension reform and liquor reform first before he will talk about what to do with the state budget or enacting revenue measures like a natural gas severance tax.  But he didn’t rule out enactment of a severance tax.

“I am willing to be here.  The Lt. Governor is willing to be here.  No bluster, no threats.  These are the facts,” said Gov. Corbett.

Expanding on Gov. Corbett’s budget statements this week, the Patriot-News reported Friday Budget Secretary Charles Zogby said Gov. Corbett is committed to fighting for targeted spending increases and is conditionally open to some higher taxes to pay for them, but he will accept them only with significant reform in Pennsylvania’s public pension systems.

Secretary Charles Zogby will be the guest speaker at the Pennsylvania Press Club at high noon on Monday.

The language used by Gov. Corbett is giving people flashbacks to Gov. Rendell who one year was photographed with his feet in a kid’s wading pool waiting for the Republican Senate and Democratic House to figure out how to balance the budget.

In reaction to the Governor’s “request,” the Senate and House skipped a planned Thursday voting day, presumably so they can work on pension and liquor reform and the budget.

The Senate did move a potential General Fund budget vehicle-- Senate Bill 1431 (Corman-R-Centre)-- out of and back into the Senate Appropriations Committee and referred a likely Fiscal Code bill-- House Bill 927 (Sankey-R-Clearfield)-- back to Appropriations.

Sen. Jake Corman (R-Centre), Majority Chair of the Senate Appropriations Committee, said in an interview, he supports both pension and liquor reform, “but I don’t have 26 votes for both. I can only do what we have votes for.”

Sen. Charles McIlhenny (R-Bucks), Majority Chair of the Senate Law and Justice Committee, said Senate Republicans are working to get the votes for some sort of liquor reform, but they aren’t there yet.  He said liquor reform was “third fiddle” next to the state budget and pension reform, adding “some people think it’s more important, but it’s really not.”

Rep. Glen Grell (R-Cumberland), an advocate for pension reform with his own proposal, said this week the Governor should solicit new ideas on pensions “because it’s clear the (House) bill the Governor is supporting doesn’t have the votes to pass the House. It’s going to take some leadership on his part (Governor) to make this happen,” Rep. Grell added.

The House budget vehicle-- House Bill 2328 (Adolph-R-Delaware)-- didn’t move.  It’s still in the House Rules Committee after being reported out of the House Appropriations Committee last week to move the vehicle forward.

Both chambers continue to move related budget bills for the Gaming Fund, Public Utility Commission and others through the process.

New Deficit Number No Surprise

The Independent Fiscal Office Monday released its official revenue estimate showing a $1.44 billion state revenue deficit which has to be made up in the budget process. FY 2013-14 revenues are $572 million below estimates and FY 2014-15 are $870 million lower for a two-year difference of $1.442 billion.  Click Here for more details.

$153.5 Million Legislative Surplus

The bipartisan Legislative Audit Advisory Commission reported this week the House and Senate were sitting on a $153.5 million surplus in their legislative accounts at the end of 2013, $14 million more than in 2012.

Members of both chambers have traditionally held they need this funding reserve so they can be independent of the Executive Branch, especially if there is a disagreement with the budget.  That way legislators and staff can get paid, even if state workers do not because a General Fund budget has not been passed.  Click Here for more details.

Next Week

Rep. Bill Adolph (R-Delaware), Majority Chair of the House Appropriations Committee, said in an interview they would begin their annual marathon of amendments to the General Fund budget bill on the House Floor Monday, but gave no indication of when the “real” budget amendment might be considered.

By the way, Happy Birthday to Gov. Corbett!  He turned 65 on June 17.  You can probably guess what he wished for when he blew out his birthday candles.

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