Pennsylvania Budget Freezes in Perspective

Yesterday, Gov. Corbett and the Office of the Budget released a list of 2011-12 budgetary freezes—reductions in spending from the enacted General Fund budget—due in part to revenue shortfalls. I fully expect these reductions to be labeled “draconian.” Here’s some information to put the budgetary freezes in context.

1. General Fund Revenue Collections are $486.8 million behind forecast for the fiscal year, through half the year.
2. The enacted budget already spent more than the projected revenue collections: $27.1 billion to $26.6 in net collections, using the prior surplus to make up the gap.
3. The proposed freezes of $222 million represent less than 1 percent of the enacted GF budget. The portion the Governor can actually freeze (as the legislative and judicial and other requested freezes may not materialize) represents only a 0.57 percent reduction. And the General Fund represents less than half of total state spending, so it is important to keep these cuts in perspective and to consider the entire budget: i.e., if lawmakers think these programs are critical, perhaps they should reevaluate how other funds are spent.

For more, see our publication Understanding the Pennsylvania State Budget.