House panel's swift passage of Rendell budget

HARRISBURG - Hoping to make this the first year since 2003 with an on-time budget, the House Appropriations Committee yesterday approved Rendell's proposed spending plan months ahead of the July 1 deadline.

But that seemingly quick action doesn't mean that enacting a budget for the next fiscal year will come easily.

The committee vote was along party lines, despite efforts to attract Republican votes after Gov. Rendell's proposed sales-tax expansion and tax on gas drilling were jettisoned.

"There are no tax increases associated with this bill," said House Appropriations chairman Dwight Evans (D., Phila.), adding that that fact should make it palatable to Republicans who control the Senate.

In his budget speech last month, Rendell proposed the new taxes to help cover government employee pension obligations and to prepare for the end of federal stimulus funding in 2011.

House Republicans said they would not support the $29 billion budget, which relies on $850 million in federal funds that have not yet been approved.

"It would be improper and incorrect to base a budget on legislation that has not been voted on in D.C.," said Rep. William F. Adolph Jr. (R., Delaware), the ranking Republican on the Appropriations Committee.

Evans said he expected a vote by the full House on March 22 - exactly 101 days before the budget deadline and the same number by which the current budget missed its deadline last year. No state budget has been approved by June 30 since Rendell took office in 2003.

Rendell spokesman Gary Tuma said yesterday that the governor would sign the House bill if it was balanced, but cautioned that, without the proposed tax increases, or additional revenue from somewhere, the state faced deep deficits in 2011.

The committee debated exactly how much of an increase the budget represented over last year's. Democrats say it is a $436 million increase, factoring in a "bookkeeping maneuver" that rolls back medical-assistance costs to prior years, while Republicans contend the budget actually increases spending by $1 billion.

Tuma said the governor would continue to urge the General Assembly to take up the tax proposal separately during the budget process.

Rendell proposed reducing the sales tax from 6 percent to 4 percent, but expanding it to include 74 products and services not currently taxed. He also asked for a tax on extraction in the gas-rich Marcellus Shale reserve, which underlies most of Pennsylvania.

Erik Arneson, spokesman for the Senate Republicans, said he was pleased the House got off to an early start, but hoped the chamber would cut costs rather than increase spending.

"While it is certainly good that the House seems likely to pass a budget before the June 30 deadline this year . . . we continue to have serious reservations about the cost of the governor's proposal," said Arneson.

Evans said that, with the exception of education, other increases such as for prisons were unavoidable and that public-welfare increases were mandated by federal government.