In the Pa. Capitol, a milestone in the works: An on-time budget

HARRISBURG — What a difference an election year makes.

For the first time since Gov. Wolf took office, his administration and the Republican-controlled legislature appear to have hammered out a deal on the state budget, days in advance of the June 30 deadline to have a spending plan in place for the new fiscal year.

The agreement calls for a $32.7 billion budget that raises no new taxes or fees, and includes $100 million more for public schools, $25 million more for early childhood education, and $15 million for special education. State-related universities, including Temple and Pittsburgh, will receive a combined boost of nearly $17 million. Separately, legislators also are expected to approve an additional $60 million for school safety projects.

Absent any eleventh-hour kinks, the budget could be approved by week’s end, a full week before the deadline — a budget milestone. That would be the earliest a budget has been passed in at least 15 years.

Since Wolf, a Democrat, took office in 2015, he and GOP leaders have waged fierce battles over the state’s finances, leading to chronically late budgets. Publicly, many in the Capitol attribute the swift pace this year to a rosier revenue picture. Privately, others note that it is an election year, and elected officials are motivated to wrap up their work so they can campaign.

This year, Wolf, the entire House of Representatives, and half the members of the Senate are facing elections.

Retiring State Rep. Joe Markosek (D., Allegheny) gave a nod to that sentiment, saying Tuesday: “We all know this is an interesting year. It’s an election year, and we need to make sure we do the best for all the citizens of Pennsylvania.”

For the last three years, Wolf and a number of moderate Republicans have stressed the need to raise new revenue to keep up with mounting costs, warning of financial doom if the state does not do so. But the politically charged debate over whether to raise taxes, and which ones, has stymied the budget process and led to last year’s large-scale borrowing just to balance the books.

This year, all have been largely silent on taxes. In his budget address in February, Wolf called for raising the minimum wage and imposing a new severance tax on natural gas drilling.

He got neither in this agreement — although he did land additional funding for public education, a priority for his administration.

In a statement Tuesday, Wolf praised the budget deal moving through the legislature as “responsible and bipartisan.”

“We have worked cooperatively over the past few months to find common ground and room for compromise,” he said. “This budget makes smart investments in education, safety, and human services, and continues the progress we’ve made to restore fiscal stability to the commonwealth’s finances.”

Administration officials said that a combination of stronger revenues, cost savings in administrative programs, and new money from expanded liquor sales and gambling have improved the state’s financial outlook.

Legislative leaders on Tuesday boasted that the proposed $32.7 billion spending plan represents only a 1.7 percent increase over this year’s budget.

The reality is more complex. That total does not include about $800 million in expected Medicaid expenses that were moved off the main budget books. The deal between Wolf and the legislature would fund that by tapping a variety of other accounts, one of which has been the subject of a lawsuit by a group that argues it cannot be used by elected officials to balance the budget.

The proposal also calls for moving roughly $158 million in expenses in the upcoming fiscal year onto the current fiscal year’s budget, making the percentage increase look smaller than it otherwise would be.

The House could take a final vote on much of the proposed deal as early as Wednesday, with the Senate following later in the week.

Other bills that supplement the budget were still being finalized Tuesday. That includes the so-called education code, which is expected to provide an additional $60 million for school districts to cover safety efforts, such as hiring a police officer or installing metal detectors. The push for the extra school-safety money came after the shooting on Feb. 14 at Marjory Stoneman Douglas High School in Parkland, Fla.

Senate Majority Leader Jake Corman (R., Centre) described that funding as “Phase One” in efforts to improve safety in Pennsylvania schools.

“This obviously is a beginning,” Corman said. “Sixty million is not a drop in the bucket, but at the same time, it’s just a beginning.”