Ambitious. Expensive. Bold.
Those are just a few words political experts used Tuesday to describe Gov. Tom Wolf’s first state budget proposal.
They said the governor laid out a hefty agenda in his speech that delivers on many of his campaign promises but will likely face strong opposition from the Republican majority that controls the General Assembly.
“I think this is the most ambitious agenda we’ve seen from any governor in decades,” said Franklin & Marshall College political historian G. Terry Madonna. “None of them had the scope this one has — liquor modernization, education spending, three new taxes, a minimum wage hike.”
But that doesn’t mean the plan is dead on arrival in the Legislature.
Widener University political science professor J. Wesley Leckrone said there are pieces of the proposal that could inspire compromise.
“There were some ideas that have a possibility of working because it allows people to take credit for things that are important parts of their own agendas,” he said, highlighting property tax reform as one area where there may be room for negotiation.
- Education reporter Kara Newhouse writes about the impact of Wolf’s budget proposals on public schools.
- Business and higher education reporter Tim Stuhldreher has details about the impact Wolf's proposed budget would have on the state's business community and its colleges and universities.
- Business reporter Heather Stauffer has details about the impact of Wolf’s budget proposals on health care.
- County reporter Jeff Hawkes takes a look at how Wolf's budget would impact social services.
- Agriculture, Land Use & Environment reporter Ad Crable has details about the severance tax and the impact of Wolf’s budget proposals on those issues,
- Watch the Budget Speech
State lawmakers from both sides of the aisle, including six representatives and two senators from Lancaster County, have been trying to pass legislation that would wipe out property taxes as the main funding source for schools.
Wolf’s budget proposes a $3.8 billion reduction in school district property taxes in 2016. Wolf’s administration says the proposal would reduce homeowner taxes by an average of more than 50 percent, although it is not clear exactly how any property tax aid would be distributed.
But relief for property owners will come at the expense of others.
Wolf wants to shift the burden by increasing the state’s personal income tax from the current 3.07 percent to 3.7 percent. For a person making $50,000, that’s a hike from $1,535 to $1,850.
And he will ask lawmakers to boost the state’s sales tax from 6 percent to 6.6 percent — an increase of 10 percent. That means it will cost 36 cents more in sales tax for a person who spends $60 on dinner at a restaurant.
Madonna said people who were paying attention to Wolf on the campaign trail should have expected a call for higher taxes.
“Raising the sales tax or raising income taxes are the state’s two methods of getting money, and every tax shift produces winners and losers,” he said.
How the tax shift impacts Pennsylvanians will depend largely on individual situations, but Wolf’s goal is to maximize the number of people who receive a break in the hopes of selling his plan.
Sen. Lloyd Smucker, the Republican lawmaker from West Lampeter Township who leads the high-profile Education Committee, said he's eager to see how taxpayers respond to the proposals as budget hearings get underway.
"There always seems to be a disconnect from what people expect of their government and what they are willing to pay," he said. "The governor was elected on a certain platform but I'm not sure that people truly understand what the price tag of that platform is."
Lancaster city lawmaker Rep. Mike Sturla, who serves as Democratic policy chairma, commended Wolf for proposing a bold budget that he said would "finally resolve our commonwealth’s structural deficit instead of continuing to kick the can down the road with budget gimmicks."
Leckrone said “the genius” of Wolf’s plan is his decision to pair the tax increases with sizable tax cut for the business community.
His plan involves dropping the corporate net income tax to 4.99 percent by 2018 — down from the current 9.99 percent. The change would take the rate from the nation’s second highest to the fourth lowest, his administration said.
Majority Whip Bryan Cutler, a Republican representative from Peach Bottom, indicated that is one issue where there is broad support. He said it was "encouraging that we have a governor with business experience who understands that job creation means bringing Pennsylvania’s corporate tax rate in line with that of other states."
The proposal also would complete the phase out of the Capital Stock and Franchise Tax by 2016.
E. Fletcher McClellan, a political science professor and dean of faculty at Elizabethtown College, said that if conventional political wisdom dictates that a sitting governor’s best chance of passing an agenda comes in his freshman year then Wolf is off to a pretty good start.
“He has a favorable public image that he’s cultivated as a citizen problem solver and that is how he presented his plan,” he said. “As long as he can maintain that approach, he has has a chance of at least getting some of that done.”
But McClellan warned that it won’t be easy to get his critics on board.
“There are things that Republicans would have liked to hear more about. Liquor privatization and pension reform — two issues that they’re focused on — were largely missing from his proposal,” he said.
Muhlenberg College political analyst Chris Borick said, despite some missing talking points, the proposal was full of bold policies that reflect the progressive agenda Wolf promised during the campaign.
The hard part will be waiting to see what, if anything, Republican lawmakers will use to craft their own spending proposal.
"You have to be cautious in its eventual likelihood of becoming reality," he said. "When you shoot for a high goal you may never get there but you may be able to get close. The point is to push the debate in his direction."
Here is a transcript of Gov. Wolf's budget speech.
Google+ Hangout With Fletcher McClellan
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