Wednesday, October 28, 2009

PathWays PA Special Budget Alert - October 28, 2009

Unfortunately, eventhough a budget was passed and signed weeks ago, funding for state-related universities, museums, and hospitals will not be released until the state passes the table games legislation. However, this will be the last budget alert until something new occurs.


In an effort to improve future alerts, we have created a brief survey. Please take a few minutes and let us know what you thought of our Budget Alerts and how we may be able to improve them. Also, please stay turned, as next year’s budget is already right around the corner.


More Work to Be Done: Legalization of Table Games

After the Governor signed the $27.8 billion budget on Oct. 9, lawmakers had yet to vote on a proposal to allow table games at slots parlors. Revenue from table games is projected to reach $200 million this fiscal year, which is needed to help balance the state budget.

Universities, museums, and hospitals have been allotted $730 million in the budget, but that money has been held up while legislators work on the table games bill. Legislators met briefly on October 19 to discuss the legislation and a meeting scheduled for yesterday was postponed.

The remaining issue being debated is the tax rate on the casinos’ revenue. The House is calling for a 34 percent rate while the Senate wants to set it at 12 percent. Legislators are trying to balance having a tax rate that is high enough to generate the needed revenue and one that is not too high that casinos will not be able to or want to come to Pennsylvania.

While the debate continues, universities, museums, and hospitals will have to find a way to stay open without state funding.


Long Term Impact of the Budget Impasse

While many are relieved that the budget impasse is over, numerous organizations and services are still waiting for funding or have seen their funding cut. Below are some stories and examples of the impact those cuts are having.

  • Calcutta House, which provides housing and other highly supportive services for people living with AIDS in Philadelphia and the Delaware Valley region, has so far received $50,000 in back payments and is still awaiting more than $100,000 from the city, which cannot dispense the money until it is paid by the state.
  • FIGHT, a comprehensive AIDS service organization, has received some federal money but as of yet has not received any back payments from the state.
  • The recently signed state budget gives the Ben Franklin Technology Development Authority $20 million this year, down from $50.7 million last year. The Ben Franklin Technology Partners of Southeastern Pennsylvania is one of the primary sources of seed and early-stage capital for information-technology, medical-device and biotechnology companies in the area. The cut means the company will have to reduce the number of new companies it invests in so it can focus on supporting the groups it already has invested in.
  • While 300 state workers were laid off before the budget was passed, even more will have to be laid off now because of cuts in the budget. The Governor believes the next round of layoffs will also number in the hundreds.
  • While libraries around the state of Pennsylvania seen a 20 percent cut in state funding, the Reading Public Library has been hit especially hard, losing not just state funds but also the support from the city, which contributes $450,000. Three branches of the library and the bookmobile will have to close, leaving only the main library open.

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