The temperature is in the 90s in Harrisburg this week, and most folks are wearing short sleeves. One exception is budget negotiators, who are still keeping plenty of tricks up their sleeves.
The latest word out of the Capitol is that House and Senate leaders are looking to a $28.2 billion General Fund budget spend number, up from a Senate Republican proposal to spend $27.5 billion.
How is the gap going to be financed? Largely from taking money from other state funds. Pennsylvania state government has hundreds of special funds outside the General Fund, usually financed by specific taxes and fees and dedicated for certain programs. According to Capitolwire (subscription), the funds lawmakers are looking at pilfering include the Energy Development Fund, Growing Greener II, Clean Air Fund, State Farm Account, Emergency Services Operating Fund, Keystone Fund, Agriculture Easement Purchase Fund, Environmental Stewardship Fund, and other.
This would violate tenet three of the taxpayer’s budget , by using another shell game to balance the budget.
It is unclear whether these transfers will result in program cuts in these funds area, if they are simply borrowing and planning to use next year’s revenue to pay this year’s program costs (this is the plan for the Tobacco Settlement Fund, which is a bit like taking a vacation and using next year’s Christmas bonus to pay for it), or if funds simply have unused balances. Even in the latter case, using other funds to balance the budget is risky: In April, the Commonwealth Court ruled that using the surplus from the MCare Fund was illegal and must be repaid, thus creating another $800 million hole in the Pennsylvania state budget.