Last updated: June 02. 2014 11:11PM - 2285 Views
By Marc Levy Associated Press

Pennsylvania Gov. Tom Corbett speaks in Lebanon on Thursday.
Pennsylvania Gov. Tom Corbett speaks in Lebanon on Thursday.
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HARRISBURG — Gov. Tom Corbett remains steadfast against raising taxes as a way to solve the state’s growing budget shortfall, telling lawmakers Monday that he would rather pare back spending and tap other existing sources of money to paper over a billion-dollar-plus problem.

Corbett told leaders of the Legislature’s Republican majorities in a closed-door meeting that he wants to balance the budget with spending cuts and one-time money transfers, Senate Appropriations Committee Chairman Jake Corman said.

A Corbett spokesman did not dispute Corman’s characterization, but also would not provide any details about what the Republican governor told lawmakers.

“We have a path to a reasonable, responsible budget that absent any new revenues would require the elimination of new spending proposals,” spokesman Jay Pagni said.

Corman declined to reveal details of Corbett’s plan before he briefed rank-and-file Republican senators later this week.

“It’s a work in progress,” said Corman, R-Centre. “It’s only June 2.”

Democrats were not part of the talks. However, they are applying pressure on Republicans to raise taxes on the state’s booming natural gas industry and sales of tobacco products while paring back business tax cuts.

House Majority Leader Mike Turzai, R-Allegheny, would not comment on the meeting with Corbett. He dismissed questions about raising taxes and said he would rather balance the budget by cutting spending and getting rid of tax credits. He also touted his bill to privatize the state government’s control over wine and liquor shipments and sales.

That bill, passed by the House last year and supported by Corbett, would bring in more than $1 billion in one-time fees by selling more than 2,000 new licenses to sell wine and liquor, according to a House Appropriations Committee analysis. The bill has met opposition in the Senate.

May added more bad news Monday, with the Revenue Department saying the state collected $108 million below expectations for the month. That put collections for the fiscal year behind by more than $600 million and left an overall projected shortfall of $1.2 billion in Corbett’s proposed budget for the fiscal year beginning July 1.

In February, Corbett proposed a $29.4 billion budget that would have increased spending by almost 3.7 percent, or more than $1 billion, over the current year. But with tax collections collapsing, he is quietly revising that. A big target is possibly a new $240 million public school grant program that Corbett asked the Legislature to approve.

Still, Corbett’s problems are not just about sluggish tax collections.

He emptied the state government’s reserve to balance this year’s budget. The Philadelphia School District, Pennsylvania’s largest, is putting pressure on the state for more aid after Bill Green, the chairman of a five-member state board that oversees the city’s schools, warned of “devastating and unacceptable” layoffs and service cuts.

Meanwhile, Corbett’s budget plan relies on hundreds of millions of dollars in one-time cash or savings that may not materialize.

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