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July 3, 2009

Begin nonstop budget talks | Do deadlines mean nothing to lawmakers?

Anonymous The Tribune-Democrat Fri Jul 03, 2009, 10:31 AM EDT

Don’t pay your state taxes on time and you pay a penalty.

Miss the deadline for having your automobile inspected and, if caught, you’re assessed a fine, and maybe more.

Let your state-issued professional or business license lapse and you’re fined, suspended or both; or your business is even shut down.

Fail to pass a state budget by midnight June 30? Oh well!

Those same folks we send to Harrisburg with our votes make laws requiring us to meet these deadlines. But obviously they have little or no regard for meeting the most important deadline they face: Enacting a state budget.

What a disgrace.

As of Wednesday – July 1 – and the start of the new fiscal year, the commonwealth began operating without a balanced budget, a violation of the state constitution. Initially, it means the state has lost legal authority to pay most of its bills. If the impasse lingers, tens of thousands of state employees will receive only partial pay on July 17 and July 24, before their paychecks are entirely withheld.

What a shame. Hardworking employees and their families, and agencies millions of us depend on, will not only suffer but they will become pawns in a political game between Republican and Democrat legislators. And make no mistake, Gov. Ed Rendell has little to lose politically since he’s in his second term and not eligible for re-election.

Missing the budget deadline is nothing new. It has occurred every year during the Rendell administration – and GOP-controlled Senate during that time period.

In fact, Rendell last week had warned Pennsylvanians not to expect an on-time budget, or one during this week either. He probably could have told us as much two or three months ago. You could see another budget fiasco coming.

The state faces an estimated $3.2 billion revenue shortfall for the current year. Senate Republicans want to solve the problem by cutting state spending. Rendell supports a mixture of cuts and tax increases.

If history is any measure, state residents will grow angrier by the day, put pressure on legislators back home and a budget agreement will be forthcoming.

Rendell advocates a 16 percent increase in the state income tax. We don’t favor any tax increases.

Rendell’s proposal raises the income levy to 3.57 from 3.07. This would garner about $1.5 billion in additional revenue, he said, promising that it would be only a temporary boost.

Also being bandied about are increases in the state sales tax and on tobacco.

If it makes you feel better, Pennsylvania is not alone in failing to pass a budget on time, according to the nonpartisan, nonprofit Tax Foundation (www.taxfoundation.org). It also identifies a wide range of tax increases or new taxes for states, including income, sales, vehicle, hospital, restaurant and hotel, and on limited liability companies.

New Jersey and North Carolina have even imposed an elevated tax percentage on high-income earners.

Some states have approved two-week temporary budgets while they continue working on permanent financial plans.

If there is any good news for Pennsylvania, it is that no one expects this impasse to go as long as in 1991, when a plan wasn’t in place until Aug. 4.

To assure that, we suggest that legislators and the governor lose their pays for each day we’re without a budget.

We further propose that around-the-clock negotiations begin immediately and continue until one is in place.

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