A Detailed Look at Pennsylvania's 2011-12 Budget

A blog post from Sharon Ward, originally published on Third and State.

Two weeks ago, the Pennsylvania General Assembly completed work on a 2011-12 state budget that achieved Governor Tom Corbett’s primary objective — to meet a target spending number of $27.3 billion or lower, regardless of the impact.

The budget spends $27.249 billion, the lowest amount since the 2008-09 enacted budget, with cuts totaling more than $960 million.

Still trying to piece it all together? Well, the Pennsylvania Budget and Policy Center has you covered. On Wednesday, we released a detailed analysis of the new budget. Check it out and get all the details.

Here are a few highlights:

  • The budget uses only $200 million of a $786 million 2010-11 year-end surplus. The year-end surplus was 10 times the $78 million surplus projected in the Governor’s March budget proposal.
  • The budget suspends a legally required transfer of 25% of the year-end surplus to the Rainy Day Fund. Lawmakers say this was done as a condition of receiving funds through the American Recovery Act (ARRA). With 2010-11 lapses, perhaps as much as $1 billion is carried forward and unappropriated in 2011-12.
  • The budget presumes revenue growth of 1.2% in 2011-12, far less than the 4.7% assumed in the Governor’s budget proposal in March.
  • Public schools and universities bear the brunt of the cuts in the 2011-12 budget. Grants to school districts, including the basic education subsidy, reimbursements to school districts for the loss of students to charter schools and other program cuts total more than $860 million. Higher education institutions, including Penn State and the other three state-related universities, community colleges, and the 14 State System of Higher Education universities, are reduced by $245 million.
  • Several programs administrated by the Department of Public Welfare are also cut, including welfare-to-work and human services. While the overall reduction from current year spending is relatively small, less than 1%, the budget underestimates hundreds of millions of dollars of spending in the Medical Assistance program, which will either be addressed through supplemental appropriations later in the fiscal year or through program savings.
  • The Welfare Code bill enacted in concert with the budget gives DPW broad authority for one year to make program changes to cut costs. This includes the ability to sidestep formal rulemaking processes and to change program eligibility, modify benefits and provider payments, and to eliminate presumptive eligibility. This authority is granted with the goal of keeping DPW expenditures, including expenditures on entitlement programs, within budgeted amounts.

Learn more about what is in the budget by reading PBPC's full analysis.

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