Impact of late state budget not lost on Wolf, lawmakers

The impact of a late state budget on Pennsylvanians isn’t lost on Gov. Tom Wolf and legislative leaders.

With Wolf’s decision to veto the $30.2 billion GOP-backed budget on Tuesday, they acknowledged following a joint meeting on Wednesday it essentially begins to put state government in a shutdown mode.

Thanks to a 2009 court decision, state employees don’t have to worry about a budget impasse resulting in furloughs or missed paychecks. That used to be the first pressure point that would force the governor and lawmakers to work hard to reach a budget agreement.

Now the first pressure point comes from human service agencies that find themselves being starved of state dollars to fund their operations.

Pa. House Majority Leader Dave Reed talks about pain of no budget House Major Leader Dave Reed talks about who will most likely be impacted by no state budget after the new fiscal year started today, July 1, and Gov. Wolf vetoed the legislature-passed budget last night. @pennlive

Kristen Rotz, president of the United Way of Pennsylvania, said member agencies that depend in part on the state for funding are concerned.

“Unfortunately, everybody has been through this exercise quite frequently in the last few years so their concern is tempered with reality,” she said. “The real impacts won’t be felt for a few weeks.”

But the delay could produce potential cash flow concerns for agencies if the budget impasse stretches into August, Rotz said.

Another pressure point that will come in a couple weeks is when boards of public universities sit down to set tuition rates without a clue about what to expect in state funding. Vendors will begin to feel a pinch when the bills they send the state for products and services provided go unpaid.

Soon after, school districts, especially ones that receive higher percentages of state aid, could find themselves in a squeeze if state subsidies don’t come through in a timely manner.

Wolf and Republican legislative leaders said they are hoping that scheduled talks will produce a budget agreement sooner rather than later. In the meantime, Wolf said, “I’m trying to minimize whatever problems might occur from our not having a budget signed and sealed.”

Senate Majority Leader Jake Corman, R-Centre County, indicated in a phone interview on Wednesday whatever problems do arise can be laid on the governor’s doorstep because he chose to do what no other Pennsylvania governor has done in at least 40 years: veto the budget in its entirety.

“By vetoing everything, he sets up a problem with paying providers by not reimbursing social services and that’s’ a real problem,” Corman said.

Corman reminded that former Gov. Ed Rendell chose to exercise his line-item veto authority to reject only parts of the budget that lawmakers sent to him, allowing funding to continue to flowing to the vast majority of non-controversial budget lines.

House Majority Leader Dave Reed, R-Indiana, takes the position that without an enacted budget, the governor lacks the authority to transfer funds to outside entities, which puts state government in to a “shutdown-type of mode.”

“We respect that. He’s the governor. Now we’d like to get ourselves out of it as soon as possible, and get government operating at full-speed once again,” Reed said. “Hopefully that will take weeks, not months.”

*Staff writer Charles Thompson contributed to this post.

Source: http://www.pennlive.com/