HARRISBURG — Working late into the night Wednesday to deal with a looming cash crunch, the state House of Representatives approved a budget-funding bill that if enacted would end a months-long impasse.
Gov. Wolf, however, called the revenue plan “irresponsible,” and signaled that it won’t offset the need for him to make difficult cuts to the state budget as early as Friday.
“There is some real hardship for people and institutions that people in this building really care about, and the people of Pennsylvania really care about,” the Democratic governor told the Inquirer and Daily News during an unrelated interview before the vote was taken.
The bill passed shortly before 10 p.m. by a vote of 103-91 and now moves to the Senate, where it faces an uncertain future.
The plan, pushed forward by the Republican majority, seeks to close a $2.2 billion deficit in part by selling a portion of the state’s landmark tobacco settlement fund, expanding gaming, and pulling money from special funds that pay for things like mass transit, environmental projects, and parks.
House Republican leaders have said the plan provides an alternative to tax increases and avoids a new tax on gas drillers that they fear would harm the industry.
Democrats, both in the House and in the governor’s office, however, have said the plan lacks recurring sources of revenue needed to solve a larger, more systemic budget imbalance.
The proposal will encounter opposition in the Senate, one Democratic leader said.
“I think it would be tough [to pass],” said Senate Minority Leader Jay Costa (D, Allegheny).
To some extent, House Republicans expect that.
One leader characterized the bill as a gambit, an opening bid to get a conversation going.
Before the House vote, Majority Leader Dave Reed (R, Indiana) said: “We’re going to move forward with this with the expectation we get to 102 votes and then we’ll enter into the next round of negotiations and hopefully finish that in a very timely fashion.”
Wolf said he is optimistic that the House and the Senate will come to some sort of compromise by Monday, but he would not elaborate on why he thinks that.
“Again,” he said, “there is no guarantee.”
The Senate in July passed a revenue package that would balance the budget the legislature passed on June 30 through a mix of borrowing and new and increased taxes, including a levy on natural gas drilling. Wolf has said he supports the Senate’s proposal, but tax-averse House Republicans have rejected it.
What happens in the legislature over the next few days will greatly impact what cuts, if any, Wolf has to make.
Treasurer Joe Torsella, also a Democrat, has warned that the state’s primary bank account is expected to careen toward zero, forcing Wolf to decide which bills to delay and which expenses to forgo entirely.
Wolf said he has “taken some steps” to cover the state through the weekend. Absent a revenue package, the governor said he expects that Standard & Poor’s would likely call Monday to announce that it would downgrade the state’s credit rating, making it more expensive for the state to borrow money.
Wolf said he expects to know more Friday about what specific spending he might cut.
“If they’re going to force this issue,” he said, “I will manage the financial situation as best I can.”