No results from brief Pa budget meeting

July 7, 2009 4:18:56 AM PDT
The latest round of budget talks between Gov. Ed Rendell and top legislative leaders ended almost as soon as they resumed on Monday, dashing hopes of a quick deal that would keep checks flowing to government workers, contractors and others who depend on the state's ability to spend money. The late afternoon meeting in the Capitol broke up after about 20 minutes, and there was no indication that progress had been made.

"We're moving the process," Rendell said afterward. "That's the good news."

The bad news was that nearly a week after the state's fiscal year closed, the politicians who have to negotiate a 2009-10 spending plan remain about $2 billion apart, and with opposing ideas about the solution.

Pennsylvania ended the year with a $3.3 billion deficit, and faces a similar shortfall for 2009-10. Rendell and his Democratic allies in the Legislature are proposing a mixture of program cuts and tax increases, while Republicans have dug in their heels in opposition to adding new taxes or expanding existing ones.

Senate President Joe Scarnati, R-Jefferson, said a three-year, 16 percent income tax proposal that Rendell has floated had to be taken off the table in order for progress to be made.

"Our differences continue to be the same," he said. "I'm not going to negotiate a tax increase in the back room of an office here."

Rendell came into the meeting with an offer of another $72 million in cuts, which Republican leaders said they would examine before they scheduled a follow-up meeting. The brief negotiating session was the first since last week, when Rendell hosted two days of marathon talks at the governor's official residence.

Senate Majority Leader Dominic Pileggi, R-Delaware, said the governor provided answers to some of the questions that had arisen during the previous get-togethers.

"We had questions on just about every area of the budget," Pileggi said.

Rendell spokesman Chuck Ardo said "progress was certainly limited," and leading Democratic lawmakers huddled with Rendell for more than an hour afterward.

"While we are anxious to negotiate, they are anxious to see us capitulate," Ardo said. "We have offered a balanced budget. When they offer a balanced budget, that can be a starting point for negotiations."

Rep. Mario Civera of Delaware County, the ranking Republican on the House Appropriations Committee, said his caucus was working on a budget bill they planned to try to introduce on the floor despite their minority status.

"We're working on it every day," Civera said.

He declined to go into specifics except to say the House Republicans would propose the elimination of so-called "walking around money," the legislatively directed grants that are doled out for projects and other needs across the state.

Earlier Monday, House Democrats spent three or four hours going over the budget in a closed-door caucus.

"I think they have a complete understanding about how draconian some of these cuts are," said Speaker Keith McCall, D-Carbon. "The impact of this will be felt across the board."

In the short-term, the lack of a state budget has a minimal effect, as pay for most state workers will be met until the July 17 payday.

But the lack of a budget has created a headache for school districts, which are having to hire and plan for the coming year without knowing how much state aid they will receive. And government contractors may soon find themselves increasingly forced to accept the state's IOU.

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