General Assembly Should Address Revenue, Fontana Says

In February, Governor Tom Corbett announced his budget proposal, which was based on revenue estimates provided by the governor’s budget secretary. As we enter into the month of May, the next step of the budget process has begun with the release of funding estimates by the Independent Fiscal Office (IFO). The Legislature is now in full swing to start voting on different bills that will create the 2012-13 budget.

Until this fiscal year, Pennsylvania lawmakers and the people they represent have had only one source of state budget numbers, which came from the governor’s office. Act 120 of 2010 established the nonpartisan Independent Fiscal Office that provides a second source of revenue estimates for upcoming budgets. The budget secretary will still make the official estimates, but the IFO serves as a check and balance by reviewing estimates and presents a public benchmark of its accuracy on how much the state has available to spend in the coming year.

The IFO provides constituents with more transparency, accountability on the part of state government, and takes some of the politics out of the budget process. This state agency is modeled after the Congressional Budget Office, which has become a public resource for honest data for federal cost estimates. The IFO operates in an advisory role and presents estimates in May as well as mid-June. The fiscal office has a number of additional duties including a five-year projection of the state’s fiscal condition and to recommend ways to modernize the state sales tax.

For months now, the Senate Democrats have insisted that Pennsylvania’s state deficit is not accurate or as deep as the $719 million shortfall the governor has suggested. The Independent Fiscal Office’s projections have verified our findings with the release of their own estimate this week. As a result, the shortfall according to the fiscal office will be below $300 million, which means a $420 million savings. The fiscal office also increased the estimate of revenues for 2012-13 by $395 million. The combined increase would essentially make $815 million available to restore cuts to the current year budget.

The General Assembly needs to address this additional revenue and discuss what programs and services should receive some restoration of its funding. Some areas that need to be looked at include basic education, additional financial assistance for students seeking higher education through the Pennsylvania Higher Education Assistance Agency (PHEAA), programs and services within the Department of Public Welfare or nonprofits, all which experienced draconian cuts in last year's budget.

The administration still has not addressed our aging and crumbling transportation infrastructure and using this increase in revenue could jump start an investment. The General Assembly needs to analyze what this additional revenue can mean for the 2012-13 budget so we can begin to correct the imbalance that has taken shape over the last two budget cycles.

Senator Wayne D. Fontana

42nd Senatorial District

www.senatorfontana.com