Wolf, Republicans talking budget, but not with each other

HARRISBURG - Gov. Wolf stood before a group of reporters Friday at a township building about six miles from the Capitol and implored them to provide an example of when Republican legislators had agreed to compromise during the state's prolonged budget impasse.

"I've made a lot of compromises and offers, and what have I gotten in return? Nothing," Wolf said, reiterating his call to enact major financial reforms to plug the state's multibillion-dollar deficit.

His remarks were similar to those the governor had delivered during at least 16 other stump-style appearances at schools, municipal buildings, and other settings statewide since July - from Downingtown to Pittsburgh, from Bellefonte to Phoenixville.

But speaking to a small roomful of reporters and staffers, Wolf clearly seemed frustrated Friday - and for obvious reasons.

More than a week had passed since House Republicans had defeated his plan to fund the state's spending plan through tax hikes. Neither the governor nor legislative leaders had returned to the bargaining table, instead leaving the talks to their staffers. And with the budget stalemate lingering well past 100 days, there were no signs of progress.

State Rep. Bill Adolph (R., Delaware), chairman of the House Appropriations Committee, on Friday repeated a refrain that sounded much like one from July: He said Republicans who control the legislature and the first-term Democratic governor had yet to agree on how much the state should even spend next year.

House Majority Leader Dave Reed (R., Indiana) said GOP staffers were negotiating under the assumption that Wolf's signature proposal - increasing the personal income tax and sending the extra revenue to schools - was off the table.

"I think that brings the scope of discussions into a narrower area," Reed said, offering familiar topics including pension reform, liquor privatization, and gambling expansion as potential revenue sources.

But the governor said that nothing was off the table - and complained the GOP had not delivered a counterproposal to get the state on sound financial footing.

"I understand the pain," Wolf said. "But we need to get it right."

School districts and nonprofits have been without state aid since July 1, either borrowing or cutting their way to survival.

Other consequences have become apparent as well.

On Friday, Moody's Investors Service downgraded its outlook on the state's debt from "stable" to "negative." The ratings service concluded: "Amid its extreme political gridlock, the commonwealth will be challenged to find solutions to its fiscal imbalance."

Wolf, who polls once suggested held the upper hand among citizens in the budget stalemate, might be enduring a similar downgrade. A Quinnipiac University poll this month showed that his job approval rating had fallen to 41 percent, down from 45 percent in August.

The dip came during Wolf's public-relations blitz, as he's traveled the state holding budget-related press events, typically in front of schools and gaggles of reporters, often in the days just before or after budget talks.

Reed, the House leader, said "it would certainly be my preference" if negotiations could take place without either side mounting a public offensive. But he said it had a minimal effect on the process.

Wolf, meanwhile, said it was important for Pennsylvanians to know he was working to overcome what he described as a government that has run on short-term financial fixes.

"I'm not willing to bring Washington to Harrisburg," he said. "I want [us] to actually govern ourselves."

Wolf had proposed increasing the personal income tax from 3.07 percent to 3.57 percent, but that fell short in the House. He also proposed a new tax on natural gas drilling, and has long favored such permanent income streams over one-time cash infusions, such as selling the state liquor stores.

As the week ended, neither Wolf nor Reed would predict how - or when - the impasse would end. But they were holding out hope that, eventually, some measure of compromise would emerge.

"If you're going to go through a 100-day budget impasse," Reed said, "you've got to make it worth it in the end."

cpalmer@phillynews.com

609-217-8305@cs_palmer