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Govt. Affairs

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By Chris Comisac, Robert Swift and Alyssa Biederman
Capitolwire

HARRISBURG (June 24) – While there’s still a bit more work to be done by lawmakers, the Fiscal Year 2019-20 state budget’s primary document – the General Appropriations budget – is a “done deal” that legislative leaders said will get to the Governor’s desk by Thursday.

Those leaders and Gov. Tom Wolf have agreed to a plan they say will spend $33.997 billion during the coming 2019-20 Fiscal Year, which starts on July 1.

House Appropriations Committee Majority Chairman Stan Saylor, R-York, said the expenditures within House Bill 790 represents a 1.8-percent increase in spending from the current year’s total. That assumes the current year’s spend total is $33.4 billion, which is $700 million more than the amount lawmakers in June 2018 said the FY2018-19 budget spent, which at the time they said was $32.7 billion. Compared to the budget that was passed last June, the planned FY2019-20 spend total represents a roughly 4-percent increase.

Republican leaders, since Wolf unveiled his proposed 2019-20 state budget in February, have said they intended to spend less than the $34.1 billion Wolf said his plan would cost.

And since April’s General Fund revenue collections delivered a significant amount of unexpected revenues, GOP leaders have also indicated they would push to increase the state’s Rainy Day Fund, currently containing about $22.5 million, by whatever amount of surplus revenues exist at the end of the current fiscal year.

Last week, Saylor suggested there wouldn’t be much of the more than $800 million surplus left – maybe $65 million – due to unbudgeted spending that occurred as part of the FY2018-19 state budget, pushing the overall expenditures for FY2018-19 to $33.4 billion.

However, on Monday, after his committee voted 27-9 to report HB790 to the full House, Saylor said between $200 million and $300 million (it appears to be about $212 million) would be deposited into the fund.

He later explained the bulk of that deposit into the fund would come from previously unspent state dollars (lapsed funds) the Wolf administration will make available. Senate Appropriations Committee Majority Chairman Pat Browne, R-Lehigh, later said the money is coming from the state’s “positive revenue position,” and explained anything contributing to that revenue position could be the source of the Rainy Day funding.

Although lawmakers said HB790’s spend total is $33.997 billion, there are hundreds of millions of dollars of spending moved out of the General Appropriations (GA) budget, including $245.2 million of payments for things like the debt service payment for the Tobacco Settlement Fund borrowing that was used to close a $1.5 billion hole in the FY2017-18 state budget ($115 million); the debt service on the Farm Show Lease Fund borrowing that was also used to satisfy the FY2017-18 budget deficit ($13.3 million); a $45 million deposit of collected Personal Income Tax revenue for the School Safety and Security Fund; and debt service payments for the PlanCon and Growing Greener II programs ($20 million each).

Browne acknowledged that spending is in addition to the $33.997 billion included in HB790.

There are several other transfers that appear to be at work in various GA lines items, as well as “aggressive” estimates regarding human services cost growth.

Human Services/Health

The largest of those transfers appear to occur within program lines for the state Department of Human Services.

Similar to last year, the department’s overall spend total for the department manages to be less than the prior year expenditure for the agency and its programs, including Medicaid. This time around, DHS spends $97.3 million less than it did a year ago.

Some of the funding changes are transfers to the state’s Community HealthChoices Medicaid managed long-term care program, while another $36 million in spending for child care services and assistance is replaced with federal funding, but it appears as though roughly $300 million to $400 million in spending disappears from the agency’s line items.

Regarding the significant drop in human services spending, House Republican spokesman Mike Straub later on Monday said $200 million is due to a transfer from Pennsylvania Professional Liability Joint Underwriting Association (JUA), which was established by the General Assembly in 1976 to provide healthcare providers with medical malpractice insurance. Lawmakers have been trying to transfer a significant portion of the JUA’s reserves to the General Fund, but have been blocked three prior years by the federal courts.

The other $200 million is due to the required costs paid to managed care organizations being dropped by that amount.

Later in the day, Browne characterized the reduced human services spending as being aggressive about the expected use of the state’s Medicaid and other human services program.

“A different calculation of human service caseload and rates,” explained Browne. “We are being a lot more aggressive as to the calculation of rates and caseload estimates, believing that will hold.”

He acknowledged that same aggressiveness didn’t hold during the current budget year, as Wolf sought nearly $750 million in supplemental appropriations, most of it to address unbudgeted expenses in the Department of Human Services.

“That’s the question: will it hold for this cycle?” Browne said. “I think it will at this point in time.”

The budget also assumes a savings of $7.17 million due to the elimination of the General Assistance cash assistance program. A few House Democrats, during Monday’s Appropriations Committee meeting to consider HB790, decried the decision to end the program, citing that as one of the reasons for their votes against the bill.

Later in the day, Senate Majority Leader Jake Corman, R-Centre, said the plan is for the Senate to run House Bill 33 with the language currently in the bill and send it to the Governor. Some Democrats suggested Wolf should veto HB33 as there are other legislative vehicles that could accommodate the other components of HB33 – such as a hospital assessment that helps provide funding to Philadelphia hospitals as well as the Medicaid program – unrelated to the cash welfare program.

“I’m pretty confident – at least hopeful – the Governor will sign it or at least allow it to become law,” Corman reacted to the Democrats’ urging that Wolf veto the bill.

Notable increases within departmental lines include an $84.8 million, or 5.2-percent, increase in funding for the Community Waiver Program for those with intellectual disabilities, which will provide home and community-based care for 865 individuals currently on the emergency waiting list. Wolf had proposed a $15 million increase in funding for services to individuals with intellectual disabilities and autism. And the budget devotes $12 million to provide a 2-percent increase, effective January 2020, for homecare workers who care for seniors and those with physical disabilities.

There’s also an additional $26.3 million for Mental Health Services which includes funds to provide home and community-based services for 45 individuals currently residing in state hospitals.

Additionally, Republicans and Democrats praised the 10-percent increases in funding for domestic violence (up $1.736 million) and rape crisis services (up $993,000).

And while not in the Human Services Department lines, all of the Health Department line items zeroed out by Wolf’s proposed budget (something most governors do every year) – for things like Cooley’s Anemia, Hemophilia, Lupus, Sickle Cell, Regional Poison Control Centers, Trauma Prevention, Epilepsy Support Services, Bio-Technology Research, Tourette Syndrome, Amyotrophic Lateral Sclerosis (ALS) Support Services and Leukemia/Lymphoma – are restored by HB790.

Education

The state budget includes a 3.5-percent increase in spending for K-12 education – $432 million according to the House GOP – and a 2-percent, across-the-board increase for higher education

Pre-K funding was increased compared to the prior, but not quite as much as Wolf wanted: HB790 contains a $25 million increase for Pre-K Counts, and a $5 million hike for Head Start; the Governor had sought increases, respectively, of $40 million and $10 million.

Basic education funding goes up by $160 million, not the $200 million Wolf had wanted, while special education funding will increase $50 million and early intervention will go up $15 million – both amounts sought by Wolf as part of his February budget proposal.

Making it more difficult this year to determine the growth in basic education funding is the fact that most of the budget’s line item for School Employees’ Social Security payments is merged with the basic education funding line item, though Rep. Saylor said school districts will continue to get their payment the same way.

The Educational Improvement Tax Credit (EITC), a bone of contention given legislation pushed through the General Assembly in recent weeks and then vetoed by Wolf, got a funding increase, just not the type of increase contemplated by the legislation vetoed last week. The credit will go up by $25 million.

School security grants are again provided for by the state budget, with a total of $60 million again being made available for school districts ($45 million, as noted above, by way of a Personal Income Tax transfer, with the other $15 million, say legislators, coming from a court-related reserve account).

The Legislature restored some lines for which it requests funding annually, but which governors – Republican and Democrat – zero out in favor of their own funding proposals. Two such instances in education are trauma-informed education, which not only was restored but also got a $250,000 increase, and STEM education (Mobile Science and Math Education Programs), which was restored with a $750,000 funding increase.

Legislators from both parties talked up the $10 million increase for career and technical education (the same amount Wolf sought, although HB790 devotes $7 million of the increase to career and technical education and $3 million to career and technical education equipment grants.

HB790 also increases spending on adult and family literacy by $400,000, which Wolf proposed to cut by $400,000, but keep funding for the professional development of teachers flat, at $5.3 million, where Wolf had sought to increase it by $650,000. The budget also allocates $5 million more dollars to public libraries, a more than 9-percent increase from last year and something Republicans and Democrats praised.

House Democratic Minority Appropriations Chairman Matt Bradford, D-Montgomery, pointed out that the budget contains “good news” and reflects the reality of a divided state government. He also said the state’s revenue surplus gave the legislators an opportunity to allocate more funds to education.

“[The surplus] makes it easier to stand with the Governor to make up for some cuts by an earlier administration,” he said. “We can actually see the changes we so desperately need to make to early education.”

About one billion dollars in one-time federal stimulus funding discontinued at the start of this decade, with that hole, at that time, not filled by state funding. Since then, legislators on both sides of the aisle have been attempting to address that hole.

Wolf’s proposed budget did not account for any spending increases in higher education, but HB790 increases funding for many of the state’s higher education options, with the Pennsylvania State System of Higher Education, the commonwealth’s state-related and community colleges receiving two-percent hikes.

Reacting to the budget’s education components, Wolf spokesman J.J. Abbott said, “With this year’s investments, Gov. Wolf has secured nearly $1.2 billion in new education funding since the beginning of his term.”

According to the Governor’s Office, that $1.2 billion figure includes this year’s funding increase of $265 million for education. Additionally, with this year’s 2-percent increase for higher education, the administration notes that over the last five years, higher education funding has increased by $188 million.

Penn State University also received an additional $4 million for its College of Technology. Thaddeus Stevens College of Technology was also appropriated a four million dollar increase – about 27 percent more funding for the college overall.

“We have prioritized career and technical education,” said Saylor. “We are rewarding [these colleges] on placing students in real jobs across the commonwealth.”

Job training and education programs within the department’s budget – another item the Legislature had to reinstate after Wolf zeroed out funding for the program – will see a $6.25 million, or 19.7-percent, increase

Technical training, Saylor said, would improve the skill-sets of the job force and move people out of minimum-wage jobs – a recurring theme from the GOP since leaders said there won’t be a minimum wage hike as part of the budget.

While several House Democrats voted against HB790, Bradford voted for the budget bill, though he lamented the “lost opportunity” of not including a minimum wage hike.

“While there is much good that is in this budget, that missing component is for many of us a bitter pill to swallow,” said Bradford.

For nine Democrats on the appropriations panel, the lack of a minimum wage provision and lack of funding for health care and some other priorities led to their voting no on the budget bill.

“This is a terrible message we are sending to the workers of Pennsylvania,” said Rep. Patty Kim, D-Dauphin, who has offered minimum wage hike bills in the current and past legislative sessions.

Environmental Protection/Conservation and Natural Resources

The new budget bill would tap about $26 million from special funds to support the operations of the two key state environmental agencies, the Department of Environmental Protection and Department of Conservation and Natural Resources.

This is about two-thirds less than the $78 million in funding transfers to support the two agencies proposed by Wolf in his February budget address.

“It’s significantly less,” said Wolf spokesman J.J. Abbott.

Sen. Corman said the funding transfers in the budget bill reflect what the governor asked for.

The reduction reflects discussions with lawmakers and advocacy groups that led to a compromise, said Abbott.

Under HB790, DEP’s operations would be supported by $21 million in transfers from the Environmental Stewardship Fund and DCNR’s operation would be supported by an additional $5 million in transfers from the Oil and Gas Lease Fund. DCNR’s Heritage Parks program would be mostly supported by transfers from the stewardship fund.

The stewardship fund is built on revenue from trash tipping fees and a share of natural gas drilling impact fees. The oil and gas fund is built on royalties from oil and gas drilling in state forests.

If the bill is adopted, DEP’s share of funding from the taxpayer-supported General Fund would decline by 13.4 percent and DCNR’s share of funding from the General Fund would decline by 4.5 percent

The Keystone Recreation, Park & Conservation Fund, a popular venue for funding local park and recreation projects, would no longer be tapped to support DCNR as was proposed initially, said Abbott.

Wolf proposed the transfers as a way to achieve a no-tax budget and in anticipation of passage of his Restore Pennsylvania plan which calls for levying a state severance tax on natural gas production to help support a wide range of infrastructure projects, including projects in state parks and forests.

But the governor drew criticism from some Democratic lawmakers during last winter’s budget hearings about the scale of the fund transfers. They voiced concerns that fewer local projects would receive state aid as a result and the environmental agencies would have to rely more on gas drilling revenue.

Meanwhile, Republican legislative leaders have said any talk about Restore PA is off until the fall amid talk they may push their own infrastructure plan that doesn’t include a severance tax.

Despite that, Abbott said, “There is not going to be any letup for Restore Pa from us.”

Agriculture

For the past two months, Gov. Wolf and lawmakers of both parties have been developing a bipartisan package to aid Pennsylvania’s economically troubled farmers.

The unveiling of HB790 reveals the appropriations price tag for this package will be $19.5 million.

The Department of Agriculture is slated to receive $171.2 million in state funding in the next fiscal year, an increase of $19.5 million. House Republican leaders said the additional $19.5 million in funding will ensure farmers have the tools they need to succeed.

The spending initiative includes four new or revamped line items: Agriculture Preparedness and Response, including an existing appropriation to combat the Spotted Lanternfly, $4 million; Agriculture Business and Workforce Investment, $4.5 million; Livestock and Consumer Health Protection, $1 million and Animal Health and Diagnostic Commission, $2 million.

The House and Senate are at work sending enabling legislation for specific programs within these new line items to the other chamber as the spring session nears an end. The package will likely include state tax credits and low-interest loans to help farmers that may be included in fiscal code bills.

The Senate Agriculture and Rural Affairs Committee on Monday approved five House-passed agricultural aid bills, including House Bill 1516 to create an agricultural disaster response fund; House Bill 1514 to provide for farm-to-school grants; House Bill 1590 to create a $5 million dairy capital investment program; House Bill 1520 to create a state grant program to help small meat processors and House Bill 1526 to create a program to help farmers implement best management practices.

“June may prove to be the most productive month ever for pro-Dairy legislation,” said PA State Grange President Wayne Campbell referring to SB585 to create a state commission looking at the future of the dairy industry and HB 1590.

What’s not in the budget

As noted above, a minimum wage hike won’t be considered as part of the budget, though legislative leaders said discussions continue, with Republicans maintaining they’ll only consider a “reasonable” wage hike proposal while indicating that’s not how they see the Governor’s current proposal: to immediately go to $12 an hour, with stepped increases to an hourly rate of $15, and thereafter adjusting the rate annually based on the consumer price index.

Other notable items not in the budget:

  • Money for counties to purchase new voting machines. Republicans have said the Governor created the current situation by signing an executive order stating all counties must purchase new machines that leave a paper trail, so he’s on the hook for finding a funding solution or deciding not to decertify machines; Corman did suggest that some funding might be found as part of ongoing discussions about other election code bills, however he said there’s been no agreement as part of that larger conversation as yet, nor does it necessarily have to be resolved this week;
  • A per-capita tax on municipalities that don’t maintain their own police forces – instead, the budget adds $97 million in the General Fund for State Police, with that amount of funding to lower the amount of Motor License Fund dollars going to the State Police (which will also get a $9.7 million appropriation for three more cadet classes);
  • Additional funding for the U.S. Census, which the Wolf administration and others had hoped would get $12.8 million to help with efforts to count the state’s population – Republicans argued the Census is a federal government function for which the state doesn’t need to appropriate additional funds;
  • Changes to the state Corporate Net Income Tax and implementation of combined reporting, as proposed by Wolf in February.

Questions, contact RCPA Director of Government Affairs Jack Phillips.

Later today, Gov. Tom Wolf is scheduled to announce another renewal — the sixth one since he first made the declaration on January 10, 2018 — of a state opioid disaster declaration. Pennsylvania state law regarding disaster declarations is written to address, primarily, natural disasters, and Wolf’s opioid disaster declaration was the first-of-its-kind health emergency-related disaster declaration. Under state law, a state of disaster emergency may be continued by the Governor for no more than 90 days, unless renewed by the Governor or terminated, at any time, by a concurrent resolution approved by the Pennsylvania General Assembly. His office says he plans to talk about two new opioid-related initiatives at the presser this afternoon in the Governor’s Reception Room in the Main Capitol, and he’ll be joined by State Insurance Commissioner Jessica Altman, State Health Secretary Dr. Rachel Levine, Drug and Alcohol Programs Secretary Jennifer Smith, members of the Opioid Command Center, and state legislators. Questions, please contact Jack Phillips.

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HARRISBURG, Pa. (AP, June 12) — Pennsylvania’s Senate is advancing legislation (SB 25) that backers say will help make health care more available through nurses, and less expensive.

The Senate voted 44-6 on Wednesday to allow certified nurse practitioners to practice independently of physicians. Supporters say 22 other states have similar laws.

The Pennsylvania Medical Society opposes the bill. It says there are more effective ways to get health care to underserved areas, and says expanding the role of nurse practitioners may increase health care costs.

Under the bill, nurse practitioners could practice independently after serving a three-year, 3,600-hour collaboration agreement with a physician. Similar legislation has passed the Senate twice previously before dying in the House of Representatives. Questions, please contact RCPA Director of Government Affairs Jack Phillips.

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The Senate Majority Policy Committee and the Senate Health and Human Services Committee will hold a workshop on work requirements for able-bodied, non-elderly Medicaid recipients. This workshop will take place on Wednesday, June 12, from 9:30 am to 11:00 am in Room 8 EB in the East Wing of the Capitol Complex in Harrisburg. “Medicaid is one of the most expensive programs in the state and costs are projected to continue to rise,” said Senate Majority Policy chairman David G. Argall (R-Schuylkill/Berks). “Right now we have 486,000 non-disabled, non-elderly Medicaid recipients in Pennsylvania who are not working. We are not trying to drag somebody out of a treatment facility or force great-grandma to work in a coal mine. Rather, our goal is to come together and discuss this issue thoroughly with professionals so that we can come to a meaningful compromise to address this issue.”

If you are in the Harrisburg area and your schedule permits, please attend this workshop. Questions, please contact Jack Phillips.

Bucks County Democratic lawmakers are proposing legislation designed to punish drug treatment and testing companies that use vulnerable patients to help boost their profits. State Senator Steven Santarsiero, D-10, of Lower Makefield, and Representatives Tina Davis, D-141, of Bristol Township and Perry Warren, D-31, of Newtown Township, on Thursday unveiled a proposed bill that would make it a felony for health care providers, including drug and alcohol treatment centers, to give or receive money, perks, or other compensation in exchange for patient referrals. The number of licenses for drug and alcohol treatment programs issued in Pennsylvania jumped from 570 to 824 between 2012 and last year, with the biggest surge in the last three years, according to Pennsylvania Department of Drug and Alcohol Programs (DDAP) data. To read the complete article, please use this link. Questions, please contact Jack Phillips, RCPA Director of Government Affairs.

(Source: The Intelligencer; “Legislation would make patient-brokering illegal in Pennsylvania” by Jo Ciavaglia, June 7, 2019)

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Over the past few months, legislation has been introduced to eliminate Pennsylvania’s behavioral health carve-out model. Two legislators from York County, Rep. Seth Grove and Senator Kristin Phillips, introduced companion bills HB 335 and SB 268, which call for merging behavioral health with the larger statewide physical health system and network; however, both of these bills have stalled due to push back from stakeholders, who support continuation of the behavioral health carve-out model.

Despite the fact that these bills have stalled in the legislative process, Rep. Grove is urging his leadership to insert a provision into a budget bill (the Health and Human Service Code) to have the Legislative Budget & Finance Committee (LBFC) perform a “study” on the behavioral health carve-out model, thus bypassing the committee and traditional legislative process.

RCPA is asking members to contact their legislators and urge them to reject any efforts to eliminate or weaken the behavioral health carve-out model. When speaking to your legislator, please find talking points for opposing any amendments to budget bills that will affect the behavioral health carve-out model. Questions, contact RCPA Director of Government Affairs Jack Phillips.

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By MARC LEVY
Associated Press

HARRISBURG, Pa. (AP, June 5) — Pennsylvania took a first step Wednesday toward taking over its online health insurance exchange from the federal government in a bid to cut premiums for people who buy policies in the marketplace created by the Affordable Care Act.

Legislation sponsored by the Republican and Democratic floor leaders in Pennsylvania’s House of Representatives won unanimous approval from the chamber’s Insurance Committee.

Democratic Gov. Tom Wolf is pressing for the bill to pass the Republican-controlled Legislature this month in the hope that its savings measures can be in full effect in 2021.

The administration says it can operate the exchange for less money than the federal government does and use the savings to qualify for extra federal funding for a reinsurance program that helps cover certain high-cost claims.

“The products should not change, but the prices will go down, so I think that’s why it’s a win for us here in the commonwealth,” said House Majority Leader Bryan Cutler, R-Lancaster.

In addition to its high-level support in the House, the legislation is backed by the Pennsylvania Chamber of Business and Industry, the Hospital and Healthsystem Association of Pennsylvania and the Pennsylvania Association of Community Health Centers.

Wolf’s administration says the bill would make two important changes to reduce premiums for the 400,000 people who purchase health insurance through the Healthcare.gov online marketplace.

Currently, the federal government takes 3.5% of the premium paid on plans sold through the exchange, or an estimated $94 million this year.

The state can operate the exchange for $30 million to $35 million, Wolf’s administration says.

It could then use the savings to qualify for extra federal reinsurance funds and use the money to reimburse insurers for certain high-cost claims. Those reimbursements would allow insurers to lower premiums across the board within the state’s insurance marketplace, health insurance policy analysts say.

The state’s share would be about 20% or one-quarter of the reinsurance program cost, according to Wolf administration estimates.

“Both the Trump administration and the Wolf administration are interested in it, have been supportive through the process and I was hoping we could lead by example,” Cutler said.

The Wolf administration said its analysis shows that consumers would see premiums that are 5% to 10% lower than what they would otherwise pay.

Twelve states built and operate their own exchanges, while the Washington, D.C.-based nonpartisan Kaiser Family Foundation says seven other states have started a reinsurance program. Evidence from them shows that insurance premiums paid by consumers can drop, analysts say.

States at first struggled with running their own exchanges when they began in 2014 under former President Barack Obama’s signature health care law.

But Sabrina Corlette, a research professor at the Center on Health Insurance Reforms at Georgetown University, said that operating them has become cheaper and simpler as information technology systems have improved and become standardized.

Running its own exchange also gives the state more control over it, Corlette said. As an example, she noted that the Trump administration has suggested that it might end automatic re-enrollment in the exchange’s insurance policies, thus making it more cumbersome for someone to maintain their policy from year-to-year.

But a state that operates its own exchange could simply keep automatic re-enrollment, which is standard in employer-based insurance systems, Corlette said.

Questions, please contact Jack Phillips.

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Capitolwire: Restore PA to be pushed off to the fall, minimum wage hike seems unlikely as part of budget, which could start seeing movement the week of June 17, says Corman.

PA GI Bill, PA Farm Bill could get done before summer recess, adds the Senate Majority Leader, though a “reasonable” budget spend total – which Corman again said will be less than Wolf’s February proposal – still needs to be reached.

By Chris Comisac
Bureau Chief
Capitolwire

HARRISBURG (June 5) – Gov. Tom Wolf has said on multiple occasions his Restore PA proposal isn’t tied to the state budget, and it appears that will indeed be the case this month, as legislative Republican leaders don’t plan to consider the proposal until the fall, at the earliest.

“It’s not linked to the budget – the Governor didn’t link it to the budget, as far as a budgetary request – and we’re not going to address it this month,” Senate Majority Leader Jake Corman, R-Centre, during a late Tuesday afternoon interview with Capitolwire, said of the $4.5 billion infrastructure borrowing plan, with the borrowing costs to be paid by a new severance tax proposal.

“To me, this whole Restore PA thing is more about him [Wolf] getting a severance tax” than it is about infrastructure, said Corman.

“It’s not been vetted yet, and we’re certainly not going to create a revenue source that could be a WAM [walking around money] platform, without knowing how this money is going to be spent,” Corman said, who later said, “the whole issue is off for now” while the Legislature explores other options.

Wolf has campaigned across the state in recent months on behalf of the plan, but the Legislature’s majority Republicans, for the most part, have maintained their opposition to a severance tax, which hasn’t gotten much traction during the four-plus years Wolf has been governor, though some Senate Republicans helped to pass a severance tax in an effort to find a compromise to end the 2017-18 state budget impasse (a proposal that failed to win House approval).

“We’re going to continue to talk about Restore PA, and we’re open to feedback from anyone,” said Wolf spokesman J.J. Abbott on Wednesday in response to Corman’s comments.

Noting that a significant part of Wolf’s public relations blitz has focused on using Restore PA money to expand broadband, Corman said, “It’s a great need and he [Wolf] has identified the need, but, unfortunately, the proposal is very specific on the tax he wants to levy – which, obviously, is his crown jewel as he’s been trying for five years to get it – but it has very little specifics on how the broadband would be deployed and how we’d get the private sector involved with this.”

Abbott said the administration has had conversations with plenty of stakeholder groups, and will continue to do so. He also noted Restore PA legislation would soon be introduced [EDITOR’S NOTE: House Bill 1585 and Senate Bill 725 were introduced on Wednesday, though they were not yet available on the General Assembly’s legislative website on Wednesday afternoon].

Corman said the idea of singling out one business or industry to pay for something beneficial to the whole state, like broadband, doesn’t make sense, “we, as a commonwealth, should be supporting this initiative.”

“It’s a very complicated issue that’s going to take significant private sector investment,” said Corman, explaining that back in the early 2000s, much of the available Internet connectivity was accomplished through telephone companies, which were governed by the state’s Public Utility Commission.

“Because of PUC control, we could do flexible rates for them [telephone companies] to get them to do broadband,” said Corman. “Well that was DSL [Digital Subscriber Line, which offers broadband connectivity, but at far slower speeds than are available from other sources], and nobody wants DSL now.”

To accomplish higher speeds, Corman said “you’re talking cable, you’re talking wireless, and that’s done by the private sector which we don’t regulate.”

“And it’s very costly in deployment, and it’s very costly to maintain, and nothing in the Governor’s plan details how he’s enticing them to get involved with this,” Corman continued. “I’ve spoken to several of the major providers and they have had zero-to-little contact with the Governor’s Office on this.”

“It’s not ready at this time, so it’s something we have to push to the fall, at least, and spend the summer working on it,” as well as a Senate Republican plan, said Corman, who indicated his caucus doesn’t plan to wait on Wolf for details that might never come, since broadband deployment is an important issue.

He noted that some Senate Republicans have suggested an alternative – an infrastructure plan supported by revenue from lifting restrictions on gas drilling underneath state-owned forest land – but Corman said that’s not the Senate GOP Caucus’ plan.

The Senate Majority Leader said he’d like to work with the seven local development districts (LDDs) in Pennsylvania, which he noted have been working for a few years on developing and rolling out their own rural broadband plan.

“I think that developing plan has some merit to it, but, again, it needs some work, which makes the whole issue more of a fall issue than a this-month issue,” said Corman, who later added, “I’m not saying it will get done this fall … if he [Wolf] has more details this fall, then it’s a conversation we’ll have.”

Abbott said the administration welcomes hearing other proposals from the Legislature.

A minimum wage hike, for which there was a rally in the state Capitol Rotunda on Tuesday, and which has been linked by some to the budget, also appears to be trending toward a discussion at a later date, as both sides in the issue are, again, waiting to hear from the other.

“I haven’t had any conversations with the administration regarding the minimum wage,” said Corman.

He noted he said this past February that if Wolf were to offer a “reasonable” minimum wage proposal, he’d be willing to have a conversation about it, but he pointed out the Governor’s current proposal remains “unreasonable, and something we wouldn’t even consider.”

“That has not come forward; they have not reached out to talk with me about minimum wage,” said Corman. “So, I’m still in the same position I was back in February.”

When asked if he thinks a minimum wage conversation could begin and be finished before the state budget is completed this month, Corman responded: “I don’t have an idea where they are on how reasonable they want to be … if they want to come and have a conversation that’s maybe a cost-of-living adjustment, that’s something we can discuss, but I’m waiting for them to come forward.”

“At this point, it’s getting late” to get something done before the budget is completed, acknowledged Corman.

Abbott said the administration has made their position known, with the Governor’s minimum wage proposal announced in February as part of his FY2019-20 spending plan. The administration is waiting to see a proposal from legislative Republicans.

“Once we know what they’re willing to consider, then we can start negotiations,” said Abbott.

As for when the FY2019-20 state budget might be completed, Corman said it’s possible, at least at the moment, things could be done and dusted sometime during the week of June 17, but until the votes have been taken in the General Assembly, things are always subject to change.

“You never know,” said Corman. “Would we like to be doing it that week? Sure.”

“I’d like to have it done next week if I could, but that’s not likely,” said Corman, adding that things still have to develop, and depending on that, staying beyond the week of June 17 is still a possibility.

He noted House and Senate Republican leaders are, for the most part, on the same page with regard to the budget – though there are details to still be worked out – but there have been no high-level discussions between legislative GOP leaders and the Wolf administration as yet, only staff-level meetings. Those higher-level discussions are expected “soon,” said Corman.

Abbott confirmed there have been several productive staff-level meetings, but leader-level meetings have not yet occurred.

While indications from the GOP suggest a lot of Wolf’s larger budget-related proposals might not factor into the final product, Corman said some of the smaller ticket items have a chance to make their way into the enacted budget, assuming they fit into the final budget spend total.

Some of those items include the Pennsylvania GI Bill, with the House and Senate having passed their own bills; and the PA Farm Bill, Republican and Democratic bills reflecting Wolf’s proposal which the House on Wednesday advanced from committee. The Senate has already passed its own agriculture-related legislation.

Corman said he thinks the GI Bill can get to Wolf’s desk before the General Assembly’s post-budget summer recess, but he indicated there’s still some more work to be done on the agriculture bills, though he expressed the hopeful intention – which was echoed by House members on Wednesday – of getting those done before the summer break.

“He zeroed out the current agriculture programs and then proposed to spend money on other agriculture programs,” stated Corman. “Clearly we’re going to have to go back and restore those things, as we’ve had to do in the past, and after that, see what we can do with those new initiatives.”

“I’m not going to fund his [initiatives] and then have to figure out how to fund ours,” said Corman. “I’m going to fund ours first.”

“Clearly, we’re all supportive of agriculture in our caucus,” continued Corman. “It’s something we want to do, but we’ll have to get to a reasonable [budget] spend number that includes that.”

And what about that spend number? Abbott said the administration has yet to be given a spend figure by legislative Republican leaders, so they’re waiting for the GOP to reach agreement between the two chambers, which would allow budget negotiations to ramp up.

Corman says his caucus hasn’t moved from the position he and other GOP legislative leaders expressed in early May while talking about the better-than-expected revenue filling the General Fund this year.

“It’s going to be less than what the Governor asked for,” said Corman. Wolf’s Fiscal Year 2019-20 budget proposal released in February asks for a total spend of $34.1 billion. However, there appears to be hundreds of millions of dollars of proposed spending not reflected in the proposed General Appropriations spending lines, in addition to a roughly $500 million supplemental appropriation request to cover unbudgeted costs from the current FY2018-19 enacted last June.

Corman did say coming up with a “reasonable” spend number is being made difficult by the FY2018-19 supplemental request and additional adjustments made by the administration to the FY2019-20 proposal, which, according to Corman, “make it a heck of a lot more spending than he originally proposed” in February, with much of those increases coming in human services budget lines.

“He’s going to have to make a decision: does he want money for human services or does he want money for education?” said Corman of the Governor. “We’d rather spend it on education.”

Arguing Wolf didn’t account for the additional FY2018-19 spending during the year the money was spent, Corman said the Governor “is going to have to look to some of his lines [in the FY2019-20 budget] to make room for it.”

As for the prospective surplus, which some state lawmakers recently have been suggesting could, at least in part, be used for something other than covering FY2018-19 unbudgeted expenses and increasing the state’s Rainy Day Fund, Corman said his caucus, as he stated in early May, still plans to focus the money on balancing the FY2018-19 budget and addressing the state’s budgetary reserves – something Wolf has indicated to be a priority as well.

“We’re not going to spend like drunken sailors, using up all the surplus, and then wake up with a big hangover and a huge budget hole,” said Corman.

Questions, please contact RCPA Director of Government Affairs Jack Phillips.