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Friday, May 01, 2009

Pennsylvania Budget Deficit Grows by Nearly $1 Billion

Both the Pennsylvania House Democrats and Republicans are reporting an April General Fund revenue shortfall of $941.5 million. I am still waiting for the report from the Department of Revenue, but I am assuming the legislators where given the advance numbers.

If this holds up, it represents a historical drop in collections - almost certainly the worst monthly shortfall in Pennsylvania history, 24% below estimate. It also represents a shortfall nearly triple that of March (even though March was a bigger month for collections). In fact, the one month shortfall is higher than the full-year shortfall in 2002-03 or 1990-91 - the two fiscal years which resulted in the largest tax increases in Pennsylvania History.

Quite frankly, I am a bit astounded. This shortfall is almost three times the estimated shortfall the Office of the Budget provided us in mid-March. How did they get it so wrong? I will be curious if there is any explanation.


Jim Babb said...

Of course, no one is suggesting any spending cuts. Just more taxes and generational theft.

Mark Zabierek said...

The Governor has known for months how bad the deficit would be -- look for the $3B number to worsen at the end of May, as well. This only creates the "emergency/crisis" necessary for an otherwise politicallly suicidal tax increase vote by the Legislature. What is the over/under on a budget being finished by, say, December 1?

Elizabeth A. Male said...

Why do you suppose Fast Eddie was so eager to "lease" the Turnpike? Does anyone really believe he was not aware this crisis was about to bloom on his watch? Absent constitutional restriction on the use of the proceeds, do you think this "crisis" would have provided the justification for dipping into the 12.8 Billion intended for investment? Tax, borrow, "Lease".......it's all the same.

We need fully transparent taxation, fully transparent budgeting and spending, and real committment to reduced spending and retiring existing debt. The intergenerational theft must cease.