Monday, April 27, 2015

Come Aug. 1, no sales tax hike could add up to spending cuts

City Hall will have to pay a high price if state lawmakers drag out Pennsylvania's budget battle past Aug. 1.

Come Aug. 1, no sales tax hike could add up to spending cuts

City Hall will have to pay a high price if state lawmakers drag out Pennsylvania's budget battle past Aug. 1.

The precise amount: About $9 million a month.

Figure that if lawmakers approve the 1-cent increase in Philadelphia's sales tax that the Nutter Administration is seeking, it would generate an extra $100 million in the fiscal year that begins July 1. But knowing that the state budget in recent years has not been passed on time, Nutter officials, and City Council, didn't actually count on collecting the extra sales tax cash til Aug. 1.

But what happens if Aug. 1 comes and goes and there's still no word from Harrisburg?

Nutter this morning said it was "a little preliminary" to get into that, i.e., if workers would have to be furloughed or in what other ways the city would have to "start ratcheting back or constraining" its spending.

Looking ahead, he conceded that if there were no resolution come fall and into winter, "There would be significant cash issues for the city."

But for the moment, "It's pure speculation as to what might happen up in Harrisburg," Nutter said, noting it was  "a very complicated situation" and one that he was "monitoring closely."

Given the terrific uncertainty... does the mayor sleep at night? "I sleep very well and very soundly - when I actually go to sleep."

Click here for Philly.com's politics page.

About this blog

The Philadelphia Inquirer's Chris Hepp, Tricia Nadolny, Julia Terruso, and Claudia Vargas take you inside Philadelphia's City Hall.

Inquirer City Hall Staff
Also on Philly.com
Stay Connected