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Pa. revenue up, but not up enough

Pennsylvania has an extra $67 million in the bank with two months to go in the fiscal year. But that won’t make the budget process any easier.

HARRISBURG – Pennsylvania has an extra $67 million in the bank with two months to go in the fiscal year.

But that won't make the budget process any easier.

That's because the budget proposal put forward by Gov. Corbett in February assumed the state would have about $230 million in extra cash at the end of the fiscal year June 30. The governor planned to use that extra money to plug some of the gaping holes in next year's budget, mostly the result of $500 million in additional pension costs expected during the 2013-14 budget year.

So even though the state is ahead, it is also behind. Make sense?

After the official figures for April were released Tuesday, administration officials backed off the higher revenue estimate.

"It's pretty clear that we won't end the fiscal year with that extra $232 million," said Elizabeth Brassell, spokeswoman for theDepartment of Revenue. "It's unlikely that we will experience any significant gains in the next two months."

March and April are the key months for tax revenue from corporate and personal income taxes, respectively, Brassell said.

But unexpected weakness in sales tax revenues have dragged down total collections for the year, she added.

In raw dollars, the governor's budget anticipates about $28.8 billion in revenue this year, which includes that extra $232 million.

The Independent Fiscal Office, the state equivalent of the federal Congressional Budget Office, issued its own projections Wednesday afternoon.

The IFO expects the state to collect $28.58 billion this year, which is almost exactly in line with the administration's original projection, before it was revised upward in February.

If the IFO projection is correct, it leaves Pennsylvania about $222 million short of what is necessary to balance next year's budget as the governor pitched it.

So lawmakers and the administration have some work to do to bridge that gap in the next two months before the June 30 budget deadline, unless there is an unexpected surge in tax collections.

And coming in below the revised expectations could mean more budget belt-tightening.

"In order for us to achieve the structural balance in the budget, we're going to have to continue the fiscal discipline we have employed in the past," said Jay Pagni, spokesman for the governor's budget office.

That seems unlikely to fly with Democrats.

House Appropriations Committee chairman Joe Markosek, D-Allegheny, said Wednesday a "responsible state budget" would "have to prioritize people."

"We cannot afford to cut vital programs and services," he said.

But so far, there has been little in the way of direct negotiations on a budget.

Senate President Joe Scarnati, R-Jefferson, on Monday said he was eager to start working through the specifics of the state budget and seemed dismayed that no meetings had taken place.

He blamed an intense focus on liquor privatization from distracting attention from budgetary issues.

Boehm can be reached at and follow @PAIndependent on Twitter for more.