Commonwealth Foundation condemns earmarking of $12.7 billion in taxpayer debt
HARRISBURG, PA — The Commonwealth Foundation expressed disappointment in the Pennsylvania Senate’s passage of House Bill 1589, which authorizes $12.7 billion for debt-financed projects. The bill, which passed 47-2, goes back to the House for its approval.
"The so-called 'capital budget' is Harrisburg's version of the nefarious earmarking process in Washington, D.C.," said Matthew Brouillette, president and CEO of the Commonwealth Foundation. "The capital budget is pork-barrel politics at its worst and drives up the cost of government for every Pennsylvanian." The current version of House Bill represents almost $3,300 in additional debt per family of four in Pennsylvania.
"The capital budget forces taxpayers to subsidize the bottom lines of professional sports teams, politically connected corporations, and business ventures that can’t find private financial support," said Brouillette. "These types of taxpayer-funded projects have great political value—politicians love to bring home the pork—but they are inappropriate uses of taxpayer money and fail to foster real economic growth and prosperity."
Brouillette also criticized the capital budget for circumventing constitutional limits. He noted that debt-financing of these projects violates Article 8, Section 8 of the state Constitution which states, "the credit of the Commonwealth shall not be pledged or loaned to any individual, company, corporation or association."
"Although the practice of doling out corporate welfare through municipalities and quasi-government authorities has long been a practice in Harrisburg, it has never been a Constitutional one," said Brouillette.
Examples of the hundreds of debt-financed projects authorized by the 297-page bill include:
- $45 million for a soccer stadium in the city of Chester
- $15 million for a film/TV studio in Chester Township
- $35 million for a baseball stadium in Lackawanna County
- $12 million for a retail and entertainment complex in Harborcreek Township
- $25 million for a biofuels plant in Centre County
- $15 million for a performing arts center in Lancaster County
- $25 million for the Hershey Area Master Plan
- $250 million for a cargo airport in Hazle Township
- $8.2 million for the Route 219 Visitor/Discovery Center in McKean County
- $37.5 million for the Pocono Mountains Regional Convention Center
- $19 million for the Montgomery County Expo Center
- $10 million for an athletic and recreation complex in Philadelphia
- $12.5 million for a 200-room lodge in Tioga County
- $20 million for an art center, parking lot, bookstore and inn in Union County
"The capital budget is frequently used as both a carrot and stick to entice lawmakers into supporting other legislation," said Brouillette. "Because Gov. Rendell is granted discretion as to whether to release funds authorized for individual projects, legislators opposing the capital budget (or other legislation) risk losing funds for projects in their district."
Brouillette added that Gov. Rendell is "leaving a legacy of debt that will cost citizens for decades to come. He and our lawmakers should have learned by now that they cannot tax, borrow, or spend our state into economic prosperity. It is time we ended the earmarking process in Harrisburg and started cutting out the pork in the legislative process."
Recently, the Commonwealth Foundation released Government on a Diet: Spending Tips 2008, a report which is part of the Commonwealth Foundation’s Pennsylvania Diet Plan: 3 Steps to Fiscal & Economic Health. The Pennsylvania Diet Plan is a program designed to help state government shed millions and billions of dollars in unnecessary and wasteful spending of taxpayer money and put the commonwealth back on a path toward fiscal and economic health. For more on the Pennsylvania Diet Plan, visit www.PADietPlan.com.
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The Commonwealth Foundation (www.CommonwealthFoundation.org) is an independent, non-profit public policy research and educational institute based in Harrisburg, PA.
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