No state budget! How personal does it get?

By Dick Miller

WE.CONNECT.DOTS: How personal does it get when the Governor and PA legislators fail to pass a budget on time?

My example is tiny, but typical.

The state (at this writing) does not have a budget in place for spending beginning July 1 and ending June 30, 2016. Because of that, funds are not flowing to state universities. A tenant in one of my buildings has a large order for product at Edinboro. The purchase order is on hand, but the university has not issued authorization to commence work because it would be unable to pay the invoice.

With work (and cash) flow disrupted, my tenant has fallen behind in rent. Because rental income is off, we have delayed the next step in building renovations. I have no idea what the building contractor would be doing with my money if I were able to proceed. With the level of wages paid for work in Greenville, rest assured these people don’t just go to a tin can in the backyard. When their money doesn’t arrive in a timely fashion, they delay spending.

Gov. Tom Wolf and lawmakers are to blame, but not in equal portions.

Wolf is trying to make up for all of former Gov. Tom Corbett’s budget-slashings. Wolf’s Republican predecessor took the four years of his term to reduce expenditures. Now he seems to want to restore governor spending to Corbett’s predecessor, Democrat Ed Rendell, in one year.

That’s not to say budget negotiations would be closer to a settlement if Wolf would not have tried to erase Corbett’s footprint all at once.

Truth is that the leadership of Republican legislators, who control both chambers, has yet to budge from opposition to any tax increase at all. They say “nada” to boosts in either sales tax or personal income taxes. In addition, they have not budged on an extraction tax.

Before you fall in love with the GOP, know you are likely to be paying higher taxes at the local level to make up for Harrisburg’s tricks. During the four years Corbett wielded his tax-cutting sword, he ignored the burden that fell on local school districts and municipalities.

Local school districts had to battle the Pennsylvania State Education Association, the most powerful union in the state. Scads of laws and regulations strengthen the PSEA’s bargaining position. Corbett and the Republicans did not care.

Ohio Gov. John Kasich and Wisconsin’s Scott Walker (both presidential candidates, but not Corbett) and their legislative friends suffered bruises for attempting to provide more powers for local school districts to battle teachers’ unions.

For these irresponsible actions, Republican legislators shoulder more blame than Gov. Wolf. They helped shape the problems of the last four years under Corbett.

Democrat legislators are to blame equally with the GOP for an outlandish show of cowardly negligence.

Democrats became comfortable during the Corbett reign. Republicans controlled and did not share governance with the Dems.

The Republicans were able to run for re-election on a no tax increase history. Almost as good, Democrats campaigned on the theme “Don’t blame me.” Both slogans work well for re-election, especially when a docile media allows.

With the Governor’s office also controlled by their party, Democrat lawmakers have yet to change from their hunker-down mentality. The only players on the Harrisburg stage are Gov. Wolf and Republican legislative leadership.

In accordance with the state constitution, Wolf sent his version of a 2015-16 budget to the legislature earlier this year. Close to July 1, Republicans rammed through their version of a budget. The two versions are about $2 billion apart with Wolf claiming he needs $4 billion in new taxes to balance his budget.

Republicans maintain that they can cut expenditures by the $2 billion and use funding from other sources (no tax increases) to balance their budget. This is a repeat of Corbett’s financial chicanery and what has put the state into such a deficit in the first place.

What is missing from this picture? By now, there should be a third version of the budget, authored by the Democrat lawmakers. This would set the stage for compromise. A few Republicans might gravitate to the compromise budget, setting the stage for a final version adopted without Republican leadership input.

This result saves face for everyone.

Bottom Line: Republican lawmakers control both Harrisburg and in Washington by implementation of a rule known as “a majority of the majority.” This makes straightforward compromises difficult, if not impossible. The insidious process makes most lawmakers impotent, but more re-electable.