PA State Rep Warren Kampf provides update to constituents on budget compromise

The Pennsylvania budget stalemate has drug into its fifth month but information has now emerged about a possible compromise.  State Rep Warren Kampf provided an update via email yesterday which contained the following budget highlights:

  • The plan is reported to contain $350 million in new education funding.  What that would mean to Phoenixville, Spring-Ford or Tredyffrin-Easttown is not yet defined.  However, each school district would receive some additional funding over last year.
  • There is an historic and significant reform for public employee pensions.  The plan that is being offered as a compromise would, among other things, put new hires into a “hybrid” defined benefit/defined contribution plan; this reform is estimated to save $10 billion over time.
  • There is also some form of liquor privatization/reform being offered as part of the plan.
  • Lastly, some of the gaming revenues (approximately $600 million per year as of this writing) could be used to help off-set the spiraling state pension liabilities.

As you may have read there are also significant shifts in tax policy and revenue enhancements:

  • This proposal is said to contain as much as a 21 percent increase in the sales tax (from 6 percent to 7.25 percent) with the revenue raised providing dollar-for-dollar school property tax reductions for all private homeowners (commercial and rental properties will see no relief.)  It is reported to reduce property tax bills by 20 percent to 35 percent. Also included will be some kind of a voter referendum requirement for any new school property tax increases.
  • A 75 cent per pack cigarette tax increase is in the plan.

Some of these proposals in the budget compromise need to be supported – increased educational funding for school districts and pension reform.  Yes on both accounts.

The state’s pension system is unsustainable and pension reform is essential for the future of school districts statewide. Legislation to reform the state’s two underfunded pension systems has been a focus for Kampf since he took office.  Maybe pension reform’s time has finally come and some kind of hybrid plan will be included in the state’s final budget.

The resurrection of legislation to privatize the state’s liquor system has emerged as part of the budget discussion.   Rather than closing the state stores, legislators are floating the compromise suggestion to expand the hours of the existing stores as well as permitting wine to be sold by beer distributors, grocery stores, etc.  (Allowing Wegmans to sell wine makes this a winner suggestion in my book.)

On the tax and revenue side of the budget, a tax increase for cigarettes has my full support but I cannot imagine any PA school board members supporting the a voter referendum requirement for school property tax increases.  It’s obvious what would happen if you left the decision to taxpayers whether or not they wanted a property tax increase.

As for hiking the state’s sales tax from its current 6 percent up to 7.25 percent with the added revenue going toward reducing property taxes — ??  For property owners, a reduction of 20 – 35 percent in the property tax bill is very appealing, but what about the non-property owners, they certainly don’t gain anything.   Is the property tax reduction worth the higher retail tax at the cash register? The proposed rise in sales tax would make Pennsylvania the second highest US sales tax, right behind California’s 7.5 percent.

Personally, I’d like to know what happened to the natural gas severance tax in this budget. The drilling continues and yet another year passes without an extraction tax.

According to his email, Kampf states he has “…not made any commitments to vote for or against the framework. Without all the details it would be foolish to make such commitments. “   Kampf says that there’s the proposed budget plan does not contain severance or extraction tax on the natural gas drillers and that he would be open to such a tax.

Rep. Kampf would like to hear from his constituents regarding the proposed budget compromise.  There’s a short 15 question online survey – click here for the link.  Or you can call his office, 610.251.2876 to offer your views on the proposed budget.

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  1. I applaud Rep Kampf for keeping his constituents updated and for soliciting our opinions – although I found the survey hard to answer since the yes/no options lacks any nuance and seemed to suit only the most partisan among us. But the survey includes room for free-form comments and I encourage everyone to use that.

    You are right, Pattye, that the TE School Board takes a dim view of the referendum idea and indeed they passed a hastily constructed and misleadingly-worded resolution against it on Monday. I hope the new Board will demand the same high quality in support of its deliberations as we expect from the district students.

    The state budget has all the hallmarks of a desperate compromise that keeps elements that appeal to the hard line base on each side, but in toto is an incoherent mess. I think that the Budget process is ill-suited to the (much-needed) redesign of education funding state-wide. Same for well-thought-out plans to exit the liquor business and revamping state employee pensions. I would rather have the Legislature give Wolf little pieces of what he wants (including the severance tax – everywhere but PA??) as long as the money goes straight to the most needy school districts. And no one-time revenue gimmicks.

    And both sides need to agree to the need, timeline and bi-partisan process for the education, pension and liquor store reforms.

    No need to tell me I’m dreaming.

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  2. It looks like I’m talking to myself here, but the PA budget process is going from bad to worse. Can I just ask for anyone who cares about our government ever getting anything done to get in touch with Kampf, Dinniman and Wolf and tell them to get a budget enacted without trying to turn the state finances and operations upside down? But get everyone to commit that changes are needed, and a timetable?

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    Pattye Reply:

    With months of fencing discussion, you’d think that the state budget impasse (and the ramifications) would cause some discussion.

    Organizations most affected by the lack of a budget are those that provide human services, homelessness prevention, food for those in need, shelter for domestic violence victims, and disability services, according to the survey. Here’s an example — If the budget crisis is not resolved soon, 11 human service agencies in Berks County said they will be unable to continue programs for more than 25,000 people each month. If the budget impasse goes to January, Berks County is reporting that 75 percent of their services will be curtailed!

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  3. It’s important to highlight that Rep. Kampf is no friend to those human service providers. His GOP is the group that continues to slash and burn those programs. Gov. Wolf, to his credit, is taking a stand in support of those groups. Kampf and his caucus continue to give tax breaks to industries, especially the gas and energy companies at the expense of our schools and human services. Kampf and his caucus, for the sake of politics, also continue to advocate tax cuts that also comes at the expense of schools and human services. These are important parts of our society and they have a cost. The GOP never wants to face up to that. They are not willing to have the open, honest and difficult conversations. We see this today at in the group of GOP Presidential Candidates. We’ve seen it in the past when Kampf was running for supervisor and most recently as State Rep. Look at the latest news about the former public works director who is charged with DEP violations. He was likely directed to do that because it could be done on the cheap. Now, the township has to pay 100’s of thousands in fines. The GOP, collectively, is a group of short sighted people who pander to lunatic fringe that only understands one thing: no or law taxes, no matter the cost.

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    Pattye Reply:

    If I were the former public works directors and I was facing serious criminal charges for DEP violations due to dumping (and I was ‘directed’ to do it) think I’d be telling that part of the story. Why would you face possible jail time for the crime and not tell the full story. You seem to have a theory that Scott Cannon was directed to do the dumping, by whom? In the township org chart, the director of public works reported to the township manager, who was Mimi Gleason at the time. Are you suggesting that she directed him to dump to save township money, that’s a stretch, don’t you think?

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  4. I don’t think he was specifically told to do it. At the same time, I don’t think he was told not to do it. In any case, I don’t see him, on his own, doing that without at least telling somebody he was going to do it. I don’t think there is any question that Mimi was aware of what happened. I think others were aware. She resigns, out of the blue, after the first rupture? And then for 2 years, with Bill Martin at the helm, there are more violations? That’s why he’s culpable too and should be fired. The bottom line is that the township government didn’t want to spend the money to properly deal with the problem. Now, look at the mess. I think Mimi saw the problems, legal ones specifically, that lay ahead. How she’s not avoiding any issues is a mystery to me. What did she know and when did she know it. I guarantee you, this will come out as part of Cannon’s defense.

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  5. PA State Rep Warren Kampf posted the following this morning ..

    Friends, I am back in Harrisburg this morning to work again at passing a sensible, responsible budget.
    I, like you, am frustrated that we still do not have a state budget. It has been far too long and I am hopeful that we will see compromise win the week so we can move Pennsylvania forward. I appreciate hearing from you on the budget and other pending state matters. Please continue to make your opinion known to me so I can best represent you through these negotiations.

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