Budget Summit Recap: A Question of Priorities

If you were one of the 140 people who attended our Pennsylvania Budget Summit on Monday, your head is probably still spinning from an overload of information.

The Pennsylvania Budget and Policy Center (PBPC) has posted PowerPoint presentations and other resources from the Summit online, and we will be posting more, including video highlights, later in the week.

For now, I wanted to share a few thoughts from the Summit.

PBPC Research Director Michael Wood and I got to kick things off with an overview of Pennsylvania’s fiscal situation and the state budget proposed by Governor Corbett last week. You can get a flavor for it by reviewing our PowerPoint presentation.

It was more than just numbers and charts (although you know we love numbers and charts). We highlighted the human side of the budget and explained that there is a better alternative than deep cuts to schools, higher education, and other services.

Instead, Pennsylvania should take a balanced approach to the budget by closing tax loopholes and ending special tax breaks as well as making targeted cuts and improving accountability. That means having a conversation about priorities in the budget.

I used a version of this table to illustrate just some of the choices facing Pennsylvania policymakers in the coming weeks and months:

End These Special Tax Breaks Restore These Service Cuts
Marcellus Shale Drilling Tax: $200 Million Cuts to Penn State and Community Colleges
Other Tobacco Tax (Cigars and Smokeless Tobacco): $42 Million Elimination of Human Services Development Fund and cuts to literacy programs
Decoupling from Federal Bonus Depreciation: $235 Million Cuts to the State System of Higher Education
Ending Capital Stock and Franchise Tax Phase-Out: $90 Million Cuts to the University of Pittsburgh and Lincoln University
Closing Corporate Tax Loopholes: $600 Million Cuts to the Basic Education Subsidy and Long-Term Care Programs
Recapturing a Small Percentage of Bush Tax Cuts on Wealthiest Pennsylvanians: $330 Million Cuts to the Accountability Block Grant (which funds full-day Kindergarten and other early childhood programs) and Temple University

Another one we didn’t include in the table above is an estimated $300 million in sales tax revenue that goes uncollected from online retailers. Closing that loophole could restore any number of cuts, from roads and bridges to hospitals.

So as our state lawmakers delve into the details of this budget in hearings over the next couple weeks, they would do well to remember that this is a budget of choices. And it's up to Pennsylvanians who care about their schools, colleges and communitieis to remind lawmakers of that.


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