Lawmakers were set to return to Harrisburg on June 2 to start their busiest legislative schedule all year as they work toward a June 30 deadline for approving a spending plan for the 2014-15 fiscal year.
This year they face the same pressures they have in recent years: They are short of money and the state constitution requires the enactment of a balanced budget. Adding to the pressure is the fact that this is an election year, which means raising taxes to make up the shortfall is almost certainly out of the question.
Gov. Tom Corbett’s Budget Office estimates that the shortfall amounts to just over $1 billion.
The problem isn’t just on the revenue side, but that’s considerable enough. In April, the state Department of Revenue collected 8.8 percent, or $323 million, less than anticipated. And April is the department’s busiest collection month.
On the spending side, the Budget Office estimates the state’s additional costs for state employee and teacher pensions at $700 million. Nearly all of that goes toward an unfunded liability in the two systems, SERS and PSERS, of over $50 billion.
Lawmakers will have to look at other ways besides taxes to raise the money. Legislative sources said online gaming and some privatization of the liquor system are on the table.
A study recently released by the Legislative Budget and Finance Committee estimated that Pennsylvania casinos could earn $180 million in revenue during the first year of Internet gambling. Annual revenue could climb to $307 million, the committee said. The state would take an as-yet-undetermined amount off the top.
Legislative sources said one liquor privatization plan would allow beer and wine in supermarkets but leave the state stores, and the sale of spirits, under the Liquor Control Board.
Both proposals have a long way to go before lawmakers send Corbett a budget at the end of June.
— J.L.K. •