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Corbett’s New Budget Shortchanges PA

On Thursday, July 10, 2014, Governor Corbett signed a $29.1 billion state budget that demonstrates yet another example of his failed leadership abilities. Not only does his budget not repair the damage caused by three years of devastating cuts to education and community services, it doles out another round of corporate tax giveaways, blocks efforts to make Marcellus Shale drillers pay their fair share and fails to expand Medicaid.

What’s more, Corbett’s budget does nothing to properly address the $1.7 billion deficit he created with bad choices, using accounting gimmicks and one-time tricks to further kick the can down the road and make the situation worse next year.

Here is an overview of Corbett’s Bad Budget:

MEDICAID EXPANSION – For the second straight year, Gov. Corbett has refused to expand Expand Medicaid NowMedicaid that would provide nearly $600 million in immediate budget savings, allow 500,000 hardworking people access to healthcare and begin to create 35,000 new jobs to help the state get back on track.

  • In contrast, the governor’s “Healthy PA” plan is insufficient to provide the healthcare that working Pennsylvanians need, cuts benefits for current Medicaid benefiaries and may not even be approved by the federal government.

SCHOOL FUNDING: This budget fails to undo the devastation of Corbett’s $1 billion cuts to our school system and simply passes the buck to local communities.

  • There is no increase in basic education funding – the main source of funding for schools. In fact, total school funding is still less than in 2008 before the stimulus funding. The $159 million in new funding for some programs comes with strings attached and won’t help to avoid more property tax hikes.[1]
  • Because of Corbett’s choices, property taxes have gone up and 20,000 teachers and staff have been laid off, classrooms are overcrowded, and programs like art, music and music have been eliminated. [2] 

HIGHER EDUCATION:  Corbett continues to place the dream of a college degree out of reach for many students and parents by making tuition prices skyrocket and forcing students to shoulder thousands in burdensome loan debt.

  • This is the third straight year Governor Corbett has offered Pennsylvania’s 14 state-owned universities zero funding relief. In 2011, higher education funding was slashed nearly 20 percent, and has been flat-funded since, forcing Pennsylvania state colleges to hike tuition and fees. PA college students are now graduating with an average of nearly $30,000 in debt – the 2nd highest in the country.[3]

MARCELLUS SHALEDespite strong support to make drillers pay their fair share, Corbett once again let Pennsylvania’s oil and gas companies off the hook, costing the taxpayers nearly half-a-billion-dollars that could have been invested in schools and job creation.

  • Because of Tom Corbett, Pennsylvania is the only major gas producing state without a severance tax and the governor’s impact fee is embarrassingly low at 1.3%. That’s much less than we’re all paying in state income taxes.[4]  It’s time to make Exxon, Shell and other companies pay their fair share on the amount of natural gas they take from Pennsylvania.

 MORE CORPORATE TAX BREAKS – Even though he’s already handed out nearly $2 billion in corporate tax breaks since taking office, Gov. Corbett has once again sided with corporate special interests, giving another round of business tax breaks while failing to support school students, seniors and taxpayers. 

  • Despite a huge $1.7 billion deficit and the need to restore funding for schools and community programs, the budget gives corporations a huge tax cut by continuing to phase out the Capital Stock and Franchise Tax and failing to close the Delaware Tax Loophole, which allows wealthy corporations to avoid paying their fair share in taxes.

 

 

 


[1] House Democratic Budget Briefing, 2014/15 Budget at-a-glance (HB 2328, PN 3895)

[2] Pittsburgh Post-Gazette, Corbett’s budget falls short on education, health care and taxes, Feb. 8, 2014

[3] Pittsburgh Post-Gazette, 2012 grads have highest-ever student debt, December 26, 2013

[4] Allentown Morning Call, A tax on fracking would have raised millions, February 22, 2014

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