Category: Pennsylvania Budget

Greased Palms Caused Vote Switch Says Senator

Greased Palms Caused Vote Switch Says SenatorGreased Palms Caused Vote Switch Says Senator — Once again it appears that a victory for working families has been snatched away by the special interests. The Pennsylvania House, today, Dec.22, voted 100-99 to reconsider the state budget the Senate passed earlier this month and which appeared dead after the House rejected, Saturday, a pension reform plan that was part of the deal.

All Democrats voted for the budget along with 17 Republicans including Steve Barrar (160), Nick Miccarelli (162) and Jamie Santora (163) whose districts include Delaware County.

The budget will require a significant tax hike to balance.

It appears eerily similar to what happened in 2013 when the House appeared to have stopped the Corbett gas tax only to cave the next day.

Sen. Scott Wagner baldly says the GOP reps got their “palms greased”. It also should be noted that it appears several Democrat reps cast yea votes despite not being physically present. He also says the mild pension reform that was the subject of Saturday’s fuss is not now included in the deal.

Here is his email report:

The purpose of my email is to report that the PA House of Representatives cast several votes today to advance the stalled PA Budget.
 
The votes cast today set the stage for a budget vote tomorrow in the House for a budget of $30.788 Billion Dollars for 2015-16  year, an increase of $1.597 Billion Dollars over the 2014-15 budget of $29.191 Billion Dollars.
 
If the House votes the $30.788 Billion Dollar budget tomorrow for 2015-16 here is the best part – the House and Senate will have to consider a tax increase vote in early January.
 
You can’t make this stuff up – vote for a spending plan without knowing how you are going to pay for it !!
 
How else do I say this?
 
Corruption is alive and well in Harrisburg.
 
Today I sat in the House of Representatives gallery and watched the House in action.
 
What is puzzling to me is that PA House Democrat Member Leslie Acosta who represents Philadelphia County was absent from the House chamber and is allegedly in Nicaragua –  but she voted “yes” on a motion to revert to a prior printer bill at 1:04 PM today.  
 
Another House Member Democrat Peter Daley from Washington County was also absent from the floor but voted “yes”  on the same motion to revert to a prior printer number – his vote was also at 1:04PM.
 
Republican House Member Daryl Metcalfe questioned accountability and procedure on whether a member had to be present to vote.
 
On a final vote cast at 4:03PM Representatives Acosta and Daley were listed as absent.
 
Something smells like rotten fish – the best part was that I was sitting in the House Gallery watching the action go down.
 
I estimate that tomorrow approximately seventeen Republicans will vote for the increased budget along with the Democrats – how is this happening?
 
Here is the answer – House Democrats and the Governor’s office are promising special project money for the districts of the Republicans voting “yes” for the budget.
 
It was pointed out to me that one Republican House member is receiving several million dollars in special project money for his “yes” vote – these type of deals are taking place in Harrisburg.
 
So it is safe to assume that other Republicans are getting their palms greased for their “yes” votes.
 
In my private sector business world if I paid a municipal official to influence their vote for a waste contract with my company would I be breaking any laws?
 
And by the way, the pension reform bill the PA State Senate sent over to the House was voted down this past Saturday – so here it is – No Pension Reform – and the best part – Holiday Tax increases for everyone.
 
In closing, tomorrow will be very interesting to watch how the House members vote on the budget – keep in mind some type of tax increases are coming down the road for Pennsylvanians.

I will do an email blast tomorrow with an update.

Sen Scott Wagner (R-28)
 

Greased Palms Caused Vote Switch Says Senator

Russ Diamond Christmas Truce

Russ Diamond Christmas TruceRuss Diamond Christmas Truce — Pennsylvania State Rep. Russ Diamond (R-102) has penned this   open letter to Gov. Tom Wolf regarding the budget impasse. It is worth passing on to all, especially one’s legislators, political leaders and media sources.

Dear Governor Tom Wolf,

Pennsylvanians get it. We don’t see eye to eye. There’s a huge gap between our differing opinions on the Commonwealth’s future. We will likely continue this argument, in one form or another, for another three years.

That said, real people are depending on us. Folks who work hard to educate our children. Counties that provide critical services to the most vulnerable. Victims of domestic violence who have nowhere else to turn. The list goes on and on.

For their sake, let’s call a Christmas truce.

The House of Representatives is putting together a plan to allow them to keep functioning. It is NOT a budget. It is NOT a permanent solution. It is merely an offer to keep the lights on until such time as we can resolve our differences.

You don’t have to sign it, but you don’t have to veto it either. You can just let it sit on your desk for ten days and let it happen. It will not represent a political victory for either one of us.

It’s been nearly six months. We’ve been collecting taxes all along, and there’s federal money sitting around just waiting for us to act. It belongs to neither one of us. It should be used for its intended purposes.

The previously agreed to budget ‘framework’ has fallen apart. The votes to support the revenues required to pay for it simply don’t exist. Finger pointing and the blame game will not do anyone any good.

Look, we’re both new at this. As one freshman to another, I implore you to do the right thing. Not for you, not for me, but for the people of Pennsylvania who depend on us the most.

It’s the least we can do. We can come back next year to argue and fight. But right now, we can do something responsible to prevent a calamity of epic proportions.

It’s Christmas, sir. Please join me in declaring a temporary truce.

Sincerely,

Representative Russ Diamond

Russ Diamond Christmas Truce

Pension Deal Fails Endangering Budget

Pension Deal Fails Endangering Budget
Ego-driven irresponsibility

Pension Deal Fails — Pennlive.com has reported that a pension reform plan that was integral part of a deal for Pennsylvania to finally pass a budget Gov. Wolf would be willing to sign has failed.

The vote in the Pennsylvania House was 149-52 against. The Senate was demanding the reform to agree to significant tax hikes sought by Wolf.

The state’s pension system is horribly underfunded and the  reform sought — moving FUTURE  state government and school employees into a pension system that combined a down-sized guaranteed benefit plan with a 401(k)-style plan — was extremely mild but still a necessary step in the right direction.

The legislature passed a budget in June which was vetoed by Wolf. Wolf also vetoed a stopgap budget in September. The man is an epitome of ego-driven irresponsibility.

Pension Deal Fails Endangering Budget

Tax Hike Vote In Pa House Tomorrow

Tax Hike Vote In Pa House TomorrowTax Hike Vote In Pa House Tomorrow — The Pennsylvania House has scheduled a vote for tomorrow, Dec.19,  regarding the budget already approved by the State Senate which includes hiking the income tax from 3.08 percent to 3.3 percent.

According to various sources also it expands the sales tax to digital downloads and movies, adds a tax on e-cigarettes, hikes the cigarette tax 75 cents over two years — note: this very well might mean Pennsylvania loses money — and increases business filing fees for C-Corps to $600.
It is reported that Delaware County representatives Bill Adolph (165), Steve Barrar (160) and Nick Micarelli (162) will be among the Republicans voting for it. Frankly, considering the chaos that Gov. Wolf and his ego has caused this state we’d almost be inclined to give them a pass. But we can’t. It appears none of the underlying causes  such as incredibly out-of-control pensions and corrupt public work regulations that are among the things responsible for the state’s severe fiscal problems are going to be addressed.

If these men vote for a tax hike while failing to address the root causes of our crisis they should hang their heads in shame and their voters should not forget what they’ve done.

Steve Barrar has said he doesn’t think the (mild) pension reform on the table  would be upheld by our judges. Considering the results of the recent election he has a point. The point he’s missing, however, is that if our judges rule as he expects — which would be wrongly and corruptly — the reform is still not merely right but necessary.

And that means we have to fight. The power of the purse is a legitimate and rather gentle means of doing so. It is immoral to ask working people to bail out former Penn State President Rodney Erickson’s $477,591 pension.

If this point is hammered often enough even corrupt judges will get the message.

Tax Hike Vote In Pa House Tomorrow

State House Budget Vote Looms

State House Budget Vote Looms — Leo Knepper of Citizens Alliance of Pennsylvania tells us that the Pennsylvania House will be voting on the  senate’s budget framework tomorrow. State House Budget Vote Looms

Let your representative know not to get squishy. The hardworking little guys and gals are not the ones who should have to pay to get Pennsylvania out of the fiscal mess that was created by those who betrayed their trust.

Especially not until these people make the appropriate sacrifice.

You can let your representative know that you expect him or her to stand strong using this link: http://www.empowerpa.org/action/?vvsrc=%2fcampaigns%2f39308%2frespond

State House Budget Vote Looms

 

WAMS Back In Senate Budget

WAMS Back In Senate BudgetBy Matthew Brouillette

Yesterday, Dec. 7,  the Pennsylvania Senate passed budget-related legislation: SB 1073 and SB 1082. Now, taxpayers can finally see what’s in Gov. Wolf’s “framework” for a new budget. Here are five things we know:

1. Excessive Spending Growth. The $30.8 billion budget represents record spending and a 5.4 percent increase over last year’s budget. Even including items shifted off budget last year, this amounts to an increase of $500 million more than inflation and population growth.

2. WAMs are back. The Senate budget includes a $103 million increase in Community and Economic Development spending. This includes several line-items identified as WAMs (or “walking around money”)—slush funds used for special projects. In the past, they’ve been used to buy votes and foster rampant corruption.

3. Problematic pension reform. The revised pension bill includes a side-by-side hybrid, with a smaller defined benefit pension and a defined contribution component. While a step in the right direction, it doesn’t get the politics out of pensions.

The proposal further underfunds teachers’ and state workers’ pensions and lacks transparency. It suspends a provision that requires pension bills to have an actuarial note explaining long-term impact before a vote.

4. No privatization in “liquor privatization.” The Senate liquor plan—which has been reported on but not yet passed—would retain the government monopoly over wholesale distribution. That means every retailer would continue to buy wine and spirits from the PLCB. There would be a “study” to recommend whether the state should privatize. On the retail side, state stores would remain open in perpetuity.

5. Higher Taxes. The Senate plan requires higher taxes. We know this will include some broad-based tax increase to generate the $600-$700 million needed to pay for the spending.

We don’t know what taxes will go up. There is no agreement on a tax plan; that is, the Senate passed a budget without the revenues to pay for it. It’s unclear if there is support in the Senate to pass a tax hike, but there are very clear signs there isn’t support in the House for a tax hike of this magnitude.

To see how your senator voted, here is the roll call for SB 1073 and SB 1082.

It’s not over yet. To voice your concern to your Senate and House members, email them today.

Mr. Brouillette is president and CEO of Commonwealth Foundation.

WAMS Back In Senate Budget

Chesapeake Energy Bankruptcy Seen With Tax

Chesapeake Energy Bankruptcy Seen With TaxBy Sen. Scott Wagner: Chesapeake Energy Bankruptcy Predicted With Wolf Tax: 

Last Friday, Dec. 4, PennLive.com published a story titled “Severance Tax ‘100 percent guaranteed’ to be in next PA budget, Wolf policy secretary says”.

I have a prediction that Governor Wolf and his policy secretary, John Hanger, might find interesting.

I consider myself to be a fairly qualified and experienced investor – I regularly go on Yahoo Finance and check out financials and news of public companies.

Here is my prediction: I predict that Chesapeake Energy (NYSE Symbol – CHK) will file for bankruptcy protection within the next 12 months.

Here is my reasoning:

#1 Natural gas prices are at historic lows – natural gas companies are not able to cover their fixed costs and cover debt payments at the current price – to simplify this – if gas is selling for $2  per gallon and your fixed costs are $3  per gallon the company is losing $1 per gallon, and as a result the company will burn through massive amounts of cash quickly – in business when you run out of cash – you have a HUGE problem.

I researched Chesapeake’s most recent financials – just in the quarter ending September 30, 2015 – their third quarter revenue was $2.893 billion   – after paying ALL expenses they lost $4.695 billion  – that means just in the third quarter alone Chesapeake would have burned through $1,802 billion  of cash. They cannot continue at this rate. Chesapeake will run out of cash.

#2 Natural gas pricing is not going up for quite some time because the natural gas supply is far GREATER than demand – in addition, there are almost 1100 gas wells in PA that have been drilled, and are capped, and are not producing gas. Almost all of the 1100 wells do not have pipe lines in place to carry the gas to the main transmission line so there is still a lot of infrastructure that needs to be installed. This infrastructure costs money. Gas companies do not have the cash to install these pipe lines at the current low natural gas prices.

#3 Another large issue is that oil and natural gas companies routinely hedge their prices to protect for a price collapse – this is a type of insurance – typically these hedges only go out for two years. In simple terms, many of the natural gas companies had hedges in place when prices were a lot higher that paid them double or triple the current market rate for their gas supply. When prices are as low as they currently are, hedging is not an option.

#4 Chesapeake Energy had a class action lawsuit filed against them last week by Pennsylvania landowners because they are deducting from royalty payments the cost to transport the gas from the wellhead to the main transmission line.

Many landowners  receive zero royalty payments after Chesapeake deducts the transport costs, and some land owners have received invoices to back bill for prior years transportation costs.

The class action lawsuit will be settled for cash that Chesapeake is running out of.

#5 If you are familiar with stock market investing there is term called margin. This term means that you can buy a stock for cash and the brokerage house will lend you money to buy more stock – this is called buying stock on margin. SEC rules do not allow a stock to be purchased on margin if it is under $5  per share. Last Thursday at the close of the New York Stock Exchange, Chesapeake stock closed under $5  per share. This means that any investor who used margin or borrowed money to purchase Chesapeake stock had a margin call which is a demand to sell the stock immediately so the loan is repaid. When a stock drops under $5  per share large investors flee. Investors will shy away from Chesapeake because their future does not look good.

This morning as I am writing this  ( 10:10 a.m. Dec. 7) Chesapeake stock is trading at $4.17 per share, down almost $.40 since the open of the stock market.

Chesapeake is one of several companies in Pennsylvania that are choking financially because natural gas prices are so low – there may very well be more companies than just Chesapeake Energy that will be forced to file for bankruptcy protection.

So what is my point? It’s this:  Governor Wolf ran his campaign for Governor telling everyone that he was going to get $1 billion dollars in severance taxes from the natural gas companies. With  current natural gas prices a severance tax would yield $100 million dollars at best.

There is currently an impact fee – tax in place – so the severance tax would cost the gas companies more money, which they do not have.

The reality is that the gas companies will pass any taxes on to consumers – which means YOUR gas bill will go up if there is a severance tax imposed.

Don’t believe me?

Read York Daily Record’s latest article, “Columbia Gas Gets Smaller Rate Hike Than Sought” which talks about the gas company passing on the costs.

And by the way, this morning the price for a barrel of oil dropped under $40 – it is currently at $38.71 at 10:20 a.m..

Oil companies are facing the same challenges as the natural gas industry because the price of oil is at historic lows.

Sen. Wagner represents the 28th District in the Pennsylvania Senate.

Chesapeake Energy Bankruptcy Predicted With Wolf Tax

Wolf Spends Sans Budget

Wolf Spends Sans Budget
While schools beg for funds, Wolf’s favorites continue to roll in the dough.

Wolf spends. A study by Pennsylvania legislators released yesterday, Dec. 3, has revealed that Gov. Tom Wolf’s administration spent $30.4 billion in state and federal money from July 1 through Oct. 31, despite the last budget authorization ending on June 30.

About $2.7 billion came from waivers, which is unspent money from prior budgets that a governor can request to use by notifying the House and Senate appropriations committees and then obtaining the funds from the Department of Treasury.

More than 77 percent of the administration requests did not disclose the actual dollar amount sought and is characterized as the “governor’s private surplus funds.”

Money that was disclosed included:

• $1,275 paid by the Department of Health to a catering company;

• $600,000 for subscriptions to publications for state agencies;

• $500,000 in membership dues for Wolf administration employees;

“During a budget impasse, spending should be kept to a bare minimum,” said State Rep. Russ Diamond (R-102).  “We’ve done so in the legislature, out of respect to the people of this Commonwealth.”

Diamond noted that domestic violence shelters, rape crisis centers, other social service agencies, and schools were grasping at straws to make cutbacks, obtain expensive loans, and even contemplating closing their doors..

The Pennsylvania Legislature passed a $30.179 billion budget on June 30 which was vetoed by Wolf. The budget  was a 3.6 increase over the previous year.

Wolf also has vetoed a stopgap budget that would have funded these schools and service agencies until other matters get resolved.

Wolf is insisting on a massive tax increase and is unwilling to compromise on issues which would slow the massive growth in the the state’s public spending such as pension reform and ending the prevailing wage mandate.

He is a selfish and short-sighted man.

Wolf Spends Sans Budget

 

Taxpayers Special Enough To Fight Tax Hike

Taxpayers Special Enough To Fight Tax Hike
Leo Knepper and Penn Delco school director Lisa Esler at tonight’s update regarding the Pennsylvania budget.

A packed house of about 70 was on hand, tonight, (Nov. 18) at the Newtown Square Knights of Columbus Hall to hear Leo Knepper give the latest regarding the various dramas occurring in Harrisburg in a talk before the Delaware County Patriots.

Knepper is executive director of Citizens Alliance of Pennsylvania, an organization founded to raise the standard of living of all Pennsylvanians and battle government corruption.

Knepper pointed out that the sales tax hike being pushed by Gov. Tom Wolf is a 21 percent increase and noted that there are plenty of places the budget could be cut to more than make up for the $2 billion the proposed tax hike from 6 percent to 7.25 percent would be expected to raise.

Knepper said that the state is spending $250 million for race horse development alone. He said that besides the General Fund the state has $18 billion tucked away in fat-filled special and other funds.

The special and other funds are the playgrounds of special interests he implied and are never considered for pruning.

“We need to get them moving from other special interests because the taxpayers are special enough,” Knepper said.

Knepper said money is still being doled out in Harrisburg with favored agencies getting lines of credit. He said this included Gov. Wolf’s travel expenses. He said Wolf was selecting services not to fund based on how much suffering they would inflict on the populace so they would agitate for a budget agreement.

Knepper noted that Wolf had vetoed stopgap budgets passed by the legislature.

Knepper also described how regulations unnecessarily raise the burden on taxpayers. He cited specifically the prevailing wage mandate, the state law that requires any significant public project to pay a wage set by the state Department of Labor and Industry’s Bureau of Labor Law Compliance.  Knepper described how one school district bidded out a project under prevailing wage and without out and found they would have shaved the cost by 40 percent but for the state law.

For Springfield residents, that means the approved $140 million new high school would cost just $80 million sans the burdensome law.

In other bad news, Knepper said that regarding Pennsylvania’s pension crisis the $50 billion officially claimed unfunded liability  regarding the Pennsylvania State Employees Retirement System (SERS) and Public School Employees Retirement System (PSERS) is actually $120 billion if normal accounting standards are used.

Among those collecting a public-guaranteed SERS pensions are Gary Schultz and his  pal Jerry Sandusky.  Schultz’s yearly pension is $330,699.  Yes, you working class person, you have to cover that.

Regarding the Syrians that Gov. Wolf is trying to bring in, Knepper said his group is researching the issue and that while they have not had time to come to any certain conclusion it appears that there is little a state can do to stop a federal resettlement program.

Agnes Trouillet was given an ovation at the meeting. Agnes is a Parisian who is teaching French at Penn and doing a paper on American Tea Party groups. While she didn’t know any of the victims of the Nov. 13 terrorist attack she had friends who did.

Taxpayers Special Enough To Fight Tax Hike

Sales Tax Hike Problem For Pa.

By Nathan Benefield Sales Tax Hike Problem For Pa.

After nearly five months of gridlock, a new state budget framework has been announced. The plan would raise the sales tax rate to the second-highest in the nation while promising property tax relief for homeowners in return.

At this point, it’s tempting to call any progress on budget agreement a victory, but is this tentative framework truly a “win” for Pennsylvanians?

Let’s start with the good: It appears taxpayers will be spared a personal income tax hike. A spike in utility bills caused by a new severance tax is also off the table. Additionally, Governor Wolf’s plan to expand the sales tax to 45 items like nursing homes, day care, funerals, and college textbooks has reportedly been dropped.

That’s great news, given Pennsylvanians already face the 10th-highest tax burden in the nation, but not everything is so rosy.

Under this budget plan, Pennsylvania would see the first sales tax hike in nearly 50 years and would have the second-highest rate in America. At 7.25 percent, the new rate would be 21 percent higher than the state’s current 6 percent rate.

It gets even worse for Pittsburgh residents who would pay a crushing 8.25 percent, and Philadelphia’s sales tax would spike to 9.25 percent. Delaware retailers, which benefit from no sales tax, should cheer, but business in the Keystone State would suffer.

The sales tax hike would collect about $2.1 billion more from consumers, while providing only $1.5 billion in property tax relief.

What about the leftover money? It will be used to replace $600 million in gambling funds formerly allocated to property tax relief that would now be redirected to additional spending.

Most homeowners would benefit from this tax shift, but businesses—which pay an estimated 40 percent of all sales taxes—and renters would lose. They would pay the higher sales tax but see no reduction in property taxes or rents under the current proposal.

In one sense, progress has been made. Wolf’s initial budget proposal in March called for the largest tax increase in the nation, costing an astonishing $1,400 per Pennsylvania family of four. While this sales tax is far lower, taxpayers should be asking what they’ll get in return for any increase.

Much is still being worked out behind the scenes, and there’s still an opportunity to act on crucial issues like pension reform, liquor privatization, and corporate welfare reform.

First, true liquor privatization—allowing private retailers to sell wine and spirits and ending the government monopoly over distribution—must be part of any deal. This would give consumers greater selection and convenience, generate recurring revenue, and end the state’s conflict of interest as both alcohol salesman and liquor law enforcer.

Though Wolf vetoed privatization this summer, Pennsylvanians still strongly support the measure because it makes fiscal sense and common sense.

In any serious discussion of property tax relief, lawmakers must first address the primary cause of property tax increases: unsustainable public pension costs. Only by moving to a defined-contribution plan, like a 401(k), will we stop the bleeding and end the political manipulation that created a $53 billion unfunded pension debt.

Moreover, any property tax shift should include strict controls over future school tax increases. Pennsylvania ranks near the top on education spending, while residents face some of the highest property taxes. To give taxpayers more control, lawmakers should give voters the chance to approve any school tax increase—a right residents of other states, like our neighbors in Ohio, already have.

For anyone looking to cut budget waste, this one’s hard to miss: Pennsylvania hands out nearly $700 million in corporate welfare subsidies through grant and loan programs. These subsidies provide businesses an unfair advantage at taxpayer expense and should be eliminated.

Finally, any budget agreement should include a long-term pledge that government will not recklessly overspend our hard-earned dollars. The Taxpayer Protection Act, supported by 64 percent of Pennsylvania voters according to a recent poll, would limit spending growth to the rate of inflation plus population growth.

Pennsylvanians need a state budget, but they don’t want promises of relief that hide higher taxes.  Before we ask taxpayers for more, the governor and lawmakers should ensure tax dollars are spent well. True reforms that will set our state—and our families—on the path toward lasting prosperity should be part of any budget deal.

Nathan A. Benefield is vice president of policy analysis for the Commonwealth Foundation

Sales Tax Hike Problem For Pa.