HARRISBURG — With the budget impasse now in its third month, Gov. Wolf on Tuesday warned that he will have to make painful cuts in the state budget at the end of next week, and that funding for roads, schools, and other essential services may be on the chopping block.
Next Friday, the governor said, the state will run out of options to pay for government services if the Republican-controlled House does not act on a plan to fund the $32 billion spending plan that became law this summer.
“There are some tough things that I’m going to have to do,” Wolf, a Democrat, said during a morning interview on KDKA-AM radio in Pittsburgh. “We’re talking about things that aren’t going to work in terms of roads and schools. Our children are going to get hurt by this. … volunteer fire companies around the state.”
Wolf’s comments came a few hours before a group of rank-and-file conservative House Republicans unveiled their own plan to balance the budget, largely by transferring money from 41 special funds that pay for things such as 911 centers, hazardous-site cleanup, transportation, and environmental projects.
The plan would also reduce some tax credits and calls for advertising on state-owned buildings, among other measures. The House conservatives say their plan would generate $2.4 billion, enough to cover the deficits from last year’s budget and the current one.
House Republican leadership supports the plan and intends to bring it up for discussion in a closed-door GOP caucus meeting when the House returns to session next week, spokesman Steve Miskin said.
Whether the plan would pass the full House, let alone the Senate, remains to be seen.
Wolf did not hold back criticism.
“Today’s proposal fails to address our challenges,” Wolf spokesman J.J. Abbott said in a statement. “Raiding these funds will mean cuts to programs. There is no way around it.”
Jennifer Kocher, spokeswoman for the GOP-controlled Senate, said the chamber would consider the proposal if it passed the House, but added: “We are fearful that the new House plan would harm agricultural, environmental, and transportation projects across the commonwealth while not addressing long-term budgetary concerns.”
The Senate in late July passed a plan to pay for the $32 billion budget through a mix of borrowing and new or increased taxes, including a new levy on natural gas drilling and hikes in taxes on electric and telephone services.
Tax-averse House Republicans have balked at that plan, but also have steadfastly refused to return to the Capitol over the last six weeks to try to negotiate a different deal.
At Tuesday’s news conference with GOP lawmakers to unveil their plan, Rep. Joe Emrick (R., Northampton) said that the group evaluated several factors when looking for money to balance the budget. Among them: Would the transfer impact operations? Would there be any legal ramifications? Would it bring the fund below average numbers needed for various operations?
Rep. Dan Moul (R., Adams) said some of these transfers have occurred in the past, and some would involve money that appears to be dormant.
“Until and unless every source of reserve revenue is exhausted, we should not and are not asking more of our taxpayers,” Moul said. “We are simply doing what we should be doing: serving as good stewards of their hard-earned tax dollars.”
Passing the plan could be a heavy lift.
House Democrats have some “immediate concerns about the legality of the proposed transfers,” according to spokesman Bill Patton, who noted that some funds have specific purposes under the law.
“We will certainly take a close look at what they’ve come up with. At this point, we don’t fully understand it, but now that we’ve received the details today, we will do our best to see if any part of it works,” Patton said. “We’re not ruling it out, but we’re very doubtful of the utility of this plan.”
The House will be working under a tight time crunch when it returns.
State officials have said that Pennsylvania’s main checking account will dip into negative territory Sept. 15 and that the administration will no longer be able to prop it up through short-term loans or transfers without an enacted revenue plan.