New Pa. budget dispute: $12 million in "walking around money"

HARRISBURG - Though billions are at stake in the state budget that appeared headed toward the homestretch Monday, a new dispute over a scant $12 million may stand in the way of its final passage.

The state Senate yesterday overwhelmingly approved a $27.8 billion budget bill that slashed funds for libraries and environmental protection, but included millions in discretionary grant funding that House Democrats are demanding be stripped out.

The scuffle between House Democrats and Senate Republicans over a few million dollars is the latest twist in a budget standoff which this morning enters its 99th day. Now, with the Senate bill before them, House Democrats are planning to vote on their own bill - minus the discretionary funding - as early as today. They say this will expedite the process.

In a letter to Gov. Rendell, House leaders asked him to "insist that the discretionary appropriations in question be stricken from the proposal..."

Both Rendell and Senate Republicans said there was no discretionary grant funding - unofficially known as "walking around money" or WAMs - in the budget proposal.

Discretionary grant funding, which in past years totaled hundreds of millions and is distributed without oversight by House and Senate leaders and the governor, has long been veiled in secrecy and the target of criticism.

This year, however, there appeared to be general agreement in both chambers to eliminate the funding.

The $12 million at issue is directed to various state agencies to fund violence reduction, hospitals, cultural groups, and college aid. In their letter to Rendell, House Democrats said they wanted the funds redistributed to broad-based programs.

Rep. Dwight Evans (D., Phila.), chairman of the House Appropriations Committee, said the discretionary funding was "part of the issue" that was holding up movement on the budget yesterday. He said another unresolved issue was the Senate's last-minute attempt to attach new fiscal-accountability language to an otherwise routine piece of budget legislation.

The Senate budget bill now goes to the House, which is pushing to resolve the stalemate with its own legislation that could be quickly voted on and sent back to the Senate.

But the Republican-controlled Senate wants to see its plan considered in the Democrat-controlled House.

"The Senate passed a spending plan today with overwhelming bipartisan support," said Erik Arneson, spokesman for Senate Majority Leader Dominic Pileggi (R., Delaware). "The House should promptly take up SB 1085 [the latest Senate budget bill] and the related budget legislation to end this budget impasse."

The tentative agreement announced Monday calls for $27.8 billion in spending this fiscal year, which began July 1, increased business and cigarette taxes, and the authorization of table games at slots parlors.

Unlike previous budget versions, this deal, which has the support of Gov. Rendell, doesn't include new taxes on tickets to live stage performances, museums and zoos, small games of chance, natural gas drilling, or smokeless tobacco and cigars.

But the Senate proposal contains new cuts that have set off alarm bells in some quarters, among them a 20-percent slash in state library funding (from $75 million to $60 million) and an even deeper cut in the Department of Environmental Protection, reducing its budget from $229 million to roughly $160 million.

"We are afraid of cuts in service that we fought so hard to save" during the city budget crisis, said Amy Dougherty, director of the Friends of the Free Library of Philadelphia, which receives $10 million in state funds. "I am afraid there won't be enough staff to keep all branches open five days a week."

Rep. Greg Vitali (D., Delaware) said he feared that with expanded gas drilling on state lands heading for legislative approval, the proposed cutback in DEP funding will lead to less enforcement and increased pollution from unregulated drilling.