PSCFO Meets with Wolf Policy Chief Hanger

John-HangerHERSHEY – On December 15, several members of the PSCFO Board met privately with John Hanger, former DEP Secretary under former Governor Rendell and now Secretary of Policy and Planning for incoming Governor Tom Wolf.  Mr. Hanger said that he welcomes policy input from the PA State Council of Farm Organizations to the Wolf Administration.  According to PSCFO President Brian Snyder, this may be the first time PSCFO has met with an official at this level of an incoming administration.  Among the topics discussed were:

  • Need for adequate General Government Operations funds for the PA Department of Agriculture
  • Preservation of certain line items in PDA’s budget such as the Centers of Excellence, agricultural research, PA Preferred, and others
  • Importance of consistency in immigration rules. While a federal issue, state legislative initiatives could create an even more confusing set of rules for agricultural producers

Why the Budget Buzz?

BudgetThe Independent Fiscal Office (IFO), created by the General Assembly in 2010 to give the legislature a separate tool for State Budget analysis, released a report that said PA is in for hard times (http://www.ifo.state.pa.us/Releases.cfm).

IFO said that the fiscal year State Budget beginning July 1, 2015 could not utilize the $619 million one-time devices and $572 in non-recurring revenues used by the Corbett Administration to balance this year’s budget and so will be $1.85 billion in the red for FY 2015-16.

Part of that analysis included an IFO prediction that PA would have $171 million less than expected this fiscal year — and that figure may be questioned given  better than estimated revenue numbers reported for October and November — $109 million more than anticipated for this fiscal year.

IFO, the Corbett Administration and the incoming Wolf Administration agree that the Commonwealth will be challenged but there is significant disagreement as to the causes and obviously whether or not the Corbett Administration got Pennsylvania out of a Rendell fiscal hole or into a new one.

The Governor’s Budget Office’s December 3 briefing recognized the fiscal shortfall. Budget Secretary Charles Zogby said that “we’ve faced these sorts of deficits every year in this administration” and they are due to mandated costs exceeding revenues.  For the 2015-16 Fiscal Year, Zogby said that there would be spending increases in debt service (interest), corrections, pensions, and in the Department of Human Services (formerly Department of Public Welfare).

Governor-elect Wolf’s transition team issued a statement December 2 which said:

  • The FY 2014-15 Budget was built on one-time revenue sources
  • Prediction: PA will be cash-flow negative from January-March 2015.
  • The state has maxed its line of credit
  • PA is 50th in the nation in job creation.