Pa. Budget Shortfall at $1 Billion and Counting
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In case you weren’t already worried enough about state and federal funding issues, here’s a frightening piece of information: Pennsylvania is facing its largest budget shortfall since the Great Recession.
About 10 months into the fiscal year, the shortfall is more than $1 billion, according to the state Department of Revenue. It hasn’t been that significant since 2010 – the year the recession ended.
In addition, Pennsylvania’s projected structural deficit is now over $3 billion.
April’s poor tax collections are, in part, to blame: Independent Fiscal Office Director Matthew Knittel told NewsWorks that revenues were slim in every category except tobacco taxes and insurance premium taxes.
The IFO reportedly said that those experiencing income growth aren’t necessarily spending – and some businesses might have delayed reporting profits and capital gains in the 2016 tax year in anticipation of a federal income tax rate cut under President Donald Trump.
Next year’s state budget is due in June. The proposal Gov. Tom Wolf released in February doesn’t include any broad-based tax increases. In April, the state House GOP passed its own budget bill, which would include drastic funding cuts.
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