Causer: Spending is Irresponsible

HARRISBURG - Rep. Martin Causer (R-Turtlepoint) said he is deeply concerned by the $28.9 billion budget proposed by Gov. Ed Rendell on Wednesday. The proposal represents a $705 million increase in spending over the current year's enacted budget.

"I seriously question the wisdom of an overall spending increase in this economic climate," Causer said. "The governor's words over the last few weeks - and even today during his speech - do not reflect his actions at all."

In the weeks leading up to the budget address, the governor warned of state employee layoffs and "painful" cuts in spending. In his speech Wednesday, he referred to the nation's economic climate as "the worst economic crisis of our lifetime" and the "worst recession since the great depression." He acknowledged that the proposed federal stimulus package, assuming it passes, is only a temporary solution.

"The governor's actions speak louder than his words," Causer said. "The bottom line is we are expecting ZERO growth in state revenues in the next fiscal year, and we are STILL spending more than this year. It simply makes no sense."

Causer noted that while the spending difference between last year's enacted budget and this year's proposal is $705 million, the governor's decision to freeze more than $550 million in state spending in the current year's plan means the actual projected spending for this fiscal year is $27.7 billion. So the proposed $28.9 billion in spending for next year actually represents a $1.2 billion increase.

Facing a $2.3 billion shortfall in revenue collections for this year's budget, the governor is relying on, among other things, $1 billion in funding from the federal economic stimulus plan and $250 million from the state's Rainy Day fund to balance the current budget.

To boost revenue collections next year, he is proposing more than $280 million in new taxes, including a tax on natural gas harvested from the Marcellus Shale, an increased cigarette tax and a new tax on smokeless tobacco. In addition, he's counting on nearly $2.5 billion in funding from the federal government and $370 million from the state's Rainy Day fund.

"Even if the federal government does follow through on its proposed stimulus plan, what happens when the federal money dries up in two years? While we all hope and expect the economy to be in better shape at that time, there are no guarantees," Causer said.

"Of all the taxes proposed by the governor, I am particularly concerned about the proposed tax on the Marcellus Shale. This resource holds great potential to boost the state's energy supply and create much-needed jobs," Causer continued. "This is simply not the time to enact any new or increased taxes. We need to allow people to keep their hard-earned money so they can spend it and stimulate the economy, rather than hand it over to some government program."

The lawmaker is hopeful a more sensible budget will result from the coming months of negotiations. A 2009-2010 state spending plan is due to be adopted by June 30 of this year.