Harrisburg – Senator Mensch, along with many Senate colleagues, expressed concern over the significant burdens associated with the Governor Wolf’s budget plan. Pennsylvania does not need, nor can its citizens support the enormous tax increases on Pennsylvania families and employers.
The Governor’s proposed $33.8 billion budget for Fiscal Year 2015-16 represents an increase of $4.7 billion (16.1 percent) increase from Fiscal Year 2014-15. The plan would raise taxes by $12 billion over the next two fiscal years – about $1,000 for every man, woman and child in Pennsylvania. Families will pay more in personal income taxes and sales and use taxes, which, under the Wolf plan, both increases and makes additional items taxable. The Governor has proposed a property tax reduction, but one with no controls or assurances that property taxes will not again increase. Rather the plan will raise income and sales taxes permanently, for a temporary reduction in property taxes.
“The Governor’s proposal does not address, in fact practically ignores, the escalating costs of Pennsylvania’s public pension programs in favor of incurring $3 billion in new debt for PSERS,” said Mensch. “Instead of working to enact meaningful reform, the Governor proposes to pass additional costs on to future generations and continue ignoring the pension and property tax issue effecting every Pennsylvanian.”
While Gov. Wolf has proposed borrowing over $6 billion against the state, the Senate Republican Caucus remains focused on tangible initiatives to help Pennsylvanians, such as passing pension reform and improving the state’s business environment. Borrowing $6 Billion amounts to increasing our indebtedness by 33%, a very significant and troubling step.
Governor Wolf’s proposals is also likely to hinder Pennsylvania’s economic growth, and could result in the loss of thousands of jobs across the state. Current statistics from the department of Labor and Industry show Pennsylvania has a current unemployment rate of 4.8 percent, the Commonwealth’s lowest rate since March 2008. This was the fourth consecutive monthly decline in the state unemployment rate and the ninth decline in 2014. Pennsylvania’s rate is 14% below the U.S. rate of 5.6 percent.
The Governor’s budget proposal includes funding increases of $400 million for basic education funding ($400 million); special education ($100 million); Pre-K Counts ($100 million); higher education ($160 million). “I have always been weary of continually pumping more funds into our basic education system,” said Mensch. “There are no studies that show that more funding equates to smarter children. Of course we all want each new generation to be smarter, but we owe it to our taxpayers to address our basic education funding formula and address our pension deficit, rather than investing more money into a system that needs to be fixed. We need to put the same amount of focus and care into the outcome of our education system as we do our spending concerns.”
In these difficult economic times, the Republican Caucus members believe their common sense approach of charting a clear and predictable course that focuses on fiscal restraint, core priorities, targeted tax policy that stimulates the economy, and the sustainability of those financial and budgetary decisions in the future is the best course of action. Mensch hopes that the Governor, who has already enacted several executive orders and has reached outside of his jurisdiction, will be open to having an honest discussion on how to address budgetary concerns while remaining fiscally conservative.
Overall, the Governor’s budget proposal includes $6 billion in new debt, mortgaging the future of our children for increased spending now. Mensch and the Senate Appropriations Committee have scheduled three weeks of public hearings on the proposed budget, beginning March 16.
CONTACT: Sarah Stroman firstname.lastname@example.org (215) 541-2388