Progress slows in Pa. budget talks

Dashing hopes of a thaw in the frozen state budget talks, Pennsylvania's House speaker said Monday that he would not support taxes "of any kind" without a concession on liquor privatization, and raised the prospect of overriding Gov. Wolf's veto of a Republican spending plan.

Rep. Mike Turzai (R., Allegheny) assailed the Democratic governor's proposal to tax natural gas drilling, and insisted Wolf consider his party's plan to raise money by privatizing the state-run wine and liquor stores, which the governor has opposed.

"The governor has to be more realistic: He has to understand the people of Pennsylvania are not for his massive tax increase," Turzai said.

His comments came after two negotiating sessions last week that suggested progress on a budget, which was supposed to be passed by July 1. Turzai said there had been "constructive dialogue" but only "around the edges."

No talks are scheduled this week and several key players are expected to be on vacation next week.

As Turzai spoke to journalists, lobbyists, and business leaders during a monthly luncheon at the Hilton in Harrisburg, Wolf used a stop in Willow Grove to tout his nearly $30 billion budget proposal. Already rejected by GOP legislators, it would raise state income and sales taxes while overhauling the commonwealth's long reliance on property taxes to fund schools.

Wolf said if he had signed the GOP-backed budget plan last month, "I would've been laughed out of my banker's office."

He acknowledged the impasse but described the budget talks as civil.

"We're moving toward agreement," the governor said. "The issues I keep coming back to are, we've got to be honest about the need to invest in education. We've got to have a [natural gas] severance tax. We've got to make sure we have property-tax relief, and we've got to make sure that the budget is not just smoke and mirrors - it's real."

Overturning a governor's veto requires a two-thirds vote in both chambers. Although Republicans hold commanding majorities in the House and Senate, they would need to woo Democrats - at least a dozen in the House and three in the Senate - to be successful.

Spokesmen for Wolf and for the House Democrats said the veto-override idea was counterproductive and had no traction in the legislature.

"The votes aren't there, nor will they be," said Bill Patton, a spokesman for House Democrats.

Turzai acknowledged he had not counted votes or had serious discussions with Democrats about an override. He also would not put a timeline on when he would push for an override. And neither he nor the governor would speculate on how long it might take to reach a deal.

"I'm not laying odds on how long this is going to take," Wolf said. "I'm holding out for a better Pennsylvania."

Turzai said only that House leaders were willing to seek a line of credit to keep the chamber running if the impasse is protracted.

He said the two sides had not even agreed on how much to spend this year, let alone how to finance it. He contended the governor has not backed off any of his tax-generating proposals.

"The governor still doesn't understand that he does not have support for his spend number," said Turzai. "And to use that as a barometer to meet halfway is misguided. I'm hoping he is going to be more realistic going forward."

Wolf's budget includes a new 5 percent tax on the value of all natural gas extracted, plus a levy of 4.7 cents per 1,000 cubic feet of gas produced.

Turzai, who ascended to the top post in the House this year, has been an ardent critic of that severance-tax proposal, and reiterated that Monday. He and other critics say the tax would be among the nation's highest on gas drillers, and that it would depress jobs and slow one of state's most promising industries.

The administration was quick to slap back.

"Speaker Turzai continues to stand with oil and gas companies instead of our children and our schools by opposing a commonsense severance tax," said Jeff Sheridan, the governor's spokesman. "The speaker and his Republican colleagues passed a budget that . . . has led to struggling schools, soaring property taxes, multiple credit downgrades, and a multibillion-dollar deficit."

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