State Budget Overview

Keystone Research Center and the Pennsylvania Budget and Policy Center hosted a conference on the state budget yesterday.  Eighty people attended at the Harrisburg Hilton for a good overview of Gov. Rendell’s budget proposal.  The state budget normally goes through various hearings all spring then in June comes crunch time.  Lately the final passage comes down to the last hours and minutes.  Here’s an overview.

This year’s budget totals $26.6 billion down from $28 billion last year.  The economic crisis is hurting state revenues badly and 101 programs have been eliminated and another 346 cut.  Higher education is down 5.4%, libraries are cut another 2.3%, and “other” is down 11%.  K-12 education is increased along with corrections and welfare.  One million additional Pennsylvanians are expected to apply for various welfare programs so, as is usual during bad economic times, those demands on the state are increasing.

Currently we have 434,000 Pennsylvanians unemployed, 2 million are on medical assistance (and 183,000 waiting for Adult Basic), and 1.27 million collecting food stamps.  In order to balance the budget $266 million is being used from prior year funds,$557 million in cuts, $174 million in revenue will be raised from oil and gas lease funds, $250 from the Rainy Day Fund, and $1.083 billion from the federal stimulus package.

Without the recently passed economic stimulus package Pennsylvania would be facing another one billion dollars in budget cuts.  These funds primarily go to Medicaid funding, schools and PennDOT.  This money is funding projects rather than programs since it is assured for only two years.

It’s a tough budget for tough times.  Hard decisions seem to have been made eliminating or cutting non essential spending.  The Governor continues his dedication to funding education on the K-12 level.  State funding for Pitt, Penn State, Temple and Lincoln continues decades long patterns of cuts.  Hopefully improvement in the federal Pell grant program will assist.  Meanwhile all four state related universities also get the short end of the budget stick in regard to gambling revenue.

The Pennsylvania Budget and Policy Center has the budget and analysis documents available on their website.

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