John Baer: How I could save Pa. $1.5B

WITH GOV. ED set to deliver his doomsday "universal pain" budget to a joint session of the Legislature on Wednesday, here are thoughts on easing the pain.

_ Cancel our $75 million gift-to-Hollywood film-tax credit.

I like movies, but maybe Sean Penn and Kate Winslet can fend for themselves this year.

_ Cancel our $3.8 million tax exemption on airline food.

Better yet, cancel airline food.

_ Rein in our $3 million exemption on the sale of horses to out-of-state buyers?

Whoa, Trigger. No whinnying.

Point is, there are loads of lobbyists-won, narrow-interest items to dump before we even start to think big.

And all that's really needed to do that is some universal political will.

But let's start with where we are.

A $2.3 billion state deficit could grow larger by the new fiscal year in July and mean canning 2,000 state workers, program cuts and new taxes on tobacco and energy.

Rendell wants no hike in broad taxes (income, gasoline, sales), but backs a 10-cents-per-pack increase on cigarettes and new taxes on cigars, smokeless tobacco and the recovery of natural gas.

This latter is a big thought, to which I say recover away.

A nongovernment wonk referred me to a study published last June by the New Rules Project at the Institute for Local Self-Reliance, a 35-year-old, Minneapolis-based, nonprofit policy organization.

The study notes that 38 mineral-and energy-rich states tax energy and mineral recovery, while Pennsylvania does not. Not for oil. Not for coal. Not for natural gas.

The study cites Penn State geoscientists saying that large portions of western and northeastern Pennsylvania have deep-layer rock called Marcellus shale, from which maybe 50 trillion cubic feet of natural gas is recoverable.

That's almost double the amount of gas extracted nationally.

Rendell says he'll seek $150 million in new taxes on this gas.

Why not more?

The study says that a 10 percent tax brings the state a sweet $560 million and a 15 percent tax means a sweeter $840 million.

Dude, go bigger. Gas it up.

Rendell also wants half the state's Rainy Day Fund, which adds another $375 million to the pot. Great, but let's make it an even $400 million.

Then he wants lawmakers to cough up their $200 million slush fund. (They call it a strategic reserve in case of, you know, war with Delaware.)

But getting this money, buried in all four caucuses, is harder than finding honor on Wall Street.

House GOP Leader Sam Smith says: "It's not horrible that the Legislature has a surplus." He wants to keep enough to run the place for at least four months, about $100 million.

Senate Republicans plan legislation to give back $90 million.

House Democratic Leader Todd Eachus tells me that he's giving up about $2 million of the $47 million in his caucus - pretty stingy compared to Republicans, especially since a Democratic guv is asking.

When I ask if it's possible that he'll give up more and maybe cut personnel (look up bloated in a dictionary, you see legislative staffs), Eachus says: "Anything's possible."

Good. The 203-member House lists 2,245 staffers. Hey, maybe that's where we get 2,000 jobs!

Lawmakers should give up their cache and give back their unjustified annual pay raises.

Between Hollywood, horses, airline food, shale, slush funds, rainy-day cash and raises, we can save $1.5 billion in a hurry.

Serious digging can find lots more.

(I like cutting the Legislature in half to save another $166 million.)

The federal stimulus package moving through Congress is said to mean $7.6 billion for the state over the next two years. Though targeted at health care, education and infrastructure, it's hard to see how that won't help.

So when His Edness spreads statewide gloom on Wednesday, just remember "universal pain" can be eased - with universal political will.

Send e-mail to baerj@phillynews.com.

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