One State Budget Deal Fails, But Another Rises In Its Ashes
PITTSBURGH (KDKA) -- What a difference a few weeks make.
Remember that budget deal that was in the works between Gov. Tom Wolf and Republican legislative leaders?
"A few weeks ago I thought we had come to a meeting of the minds, finally, after months," recalled Wolf earlier this week.
The deal would have hiked the state sales tax to cut school property taxes by $2 billion, use slots revenues to pay down the pension debt, and increase education spending.
"We said we would deliver a budget by Thanksgiving," noted Wolf.
Forget it.
That deal is now dead, leaving the state without a budget that was supposed to be in place July 1.
Wolf blames Republicans who control the state legislature.
"The Republicans have been unable to muster the votes they need to transform this agreed-upon framework into a real budget," said Wolf.
But both Republicans and Democrats share the blame, say other lawmakers.
Sources in Harrisburg tell KDKA political editor Jon Delano the deal fell apart because neither side would compromise enough.
Conservative Republicans legislators wouldn't vote for any tax increase at all, period, while liberal Democrats said they could not support a higher sales tax on the poor without a tax on Marcellus Shale drilling.
Most folks are not surprised by the break-down.
"Not one bit. It's typical politics," says Matt Presnar of New Castle.
The governor says he remains hopeful.
"I believe there are enough decent members of the General Assembly, both parties, Republicans and Democrats, who want to move beyond this terrible, nonsensical budget impasse."
And most citizens have this message to everyone in Harrisburg.
"You've had plenty of time. Time to get it done," says Lisa Burrows of Sewickley.
With the original budget deal called hike in the state sales tax from 6 percent to 7.25 percent (8.25 percent in Allegheny County) with every penny of that used to cut school property taxes now dead, Wolf said the state missed an opportunity.
But that plan is dead, Harrisburg sources say.
"I deeply regret this. We had within our grasp a budget framework that would have been transformational for Pennsylvania."
But from the ashes of one budget deal arises another, one that could affect how much you pay in taxes for cigarettes, lottery winnings, haircuts and manicures, parking, and even movie tickets, and much more.
Here are some of the ideas that Republicans, who control the legislature, are circulating.
- Hike cigarette tax 75-cents over 2 years;
- Tax e-cigarettes and roll-your-owns like other cigarettes;
- Make lottery winnings subject the state personal income tax;
- Remove the sales tax exemption and tax the purchase of the following:
* movie tickets
* digital downloads
* parking lots & garages
* haircuts
* massages & manicures
* other tax-exempt items
Now both Republican and Democratic sources in Harrisburg say – repeatedly -- there is no done deal that they and the governor will support.
But they will be back in Harrisburg next week and into December, instead of taking their usual lengthy Christmas recess.
Staff is expected to work over the holiday weekend with Republicans on the House Appropriations Committee to meet Monday to discuss these and a number of other tax changes.
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