Tax Hike Unnecessary For Pa.

Tax Hike Unnecessary For Pa.

State Senator Scott Wagner (R-28)  has issued a  statement concerning Pennsylvania’s financial situation  in response to  the mid-year budget briefing by Budget Secretary Charles Zogby given Dec. 3.

The important points are that the state has $30 billion annual revenue, a $5 billion, 60-day line of credit and a $2 billion is not unrealistic for this time of year.

Here is the  statement albeit with some editing.

I’ve been sitting back listening to my colleagues on the other side of the aisle, and unfortunately it is apparent that none of them understand how the finances of a business operate,.

The Commonwealth is identical to an operating business where there is revenue and there are expenses. As an owner and operator of multiple businesses, I fully understand that my business enterprises would not be able to operate without an operating line of credit from a bank. The Commonwealth has revenue of approximately $30 billion per year. Any experienced business operator or chief financial officer would agree that the Commonwealth of Pennsylvania should have an operating line of credit equivalent to 60 days of average revenue, which would be an operating line of credit of approximately $5 billion.

As a private sector business owner, I know how to manage a budget and what factors will impact the budget. The Democrats are trying to spin the budget issue to scare the public into thinking the only solution is more tax increases, when in reality, revenue comes in at different times throughout the year. The $2 billion deficit is not unrealistic at this time of year. A large portion of the revenue that comes into the Commonwealth is received between Jan. 1and April 15  through payments for PA State Income Tax.

Many Democrats are using the budget discussion as an opportunity to grand-stand politically and criticize Governor Corbett for the equivalent of borrowing against a line of credit to cover revenues that are slower at the end of the year. Any private sector business operator needs to understand cash flow into and out of their business. Businesses routinely operate with lines of credit. This is what businesses do – and if some of the critics would have ever signed the front of a paycheck rather than the back, they might possibly have a better understanding of cash flow, borrowing money and cycles throughout the year that affect cash flow.

Also, last winter was the worst winter that many businesses have seen in 30 years, and this impacted revenues to the Commonwealth.

At one of my companies, we spent approximately $50,000 on snow removal, which is more than double of any year that the company spent over the last 15 years. I would be curious to know how much additional expense the Commonwealth spent on snow removal at Commonwealth owned or leased facilities throughout the state.

Just consider this, if car dealers in all 67 counties throughout Pennsylvania sold 500 less vehicles per county on an average, that would equal 33,500 less vehicles sold. Factoring transaction value of $25,000 per vehicle times 33,500 vehicles would result in lost revenue of $837,500,000 to the car dealers. Sales tax of 6 percent lost to the Commonwealth on revenue of $837,500,000 would equal $50,250,000.

Many people who had planned on purchasing a new vehicle during the winter may have had to cancel their vehicle purchase to replace a roof, spouting, or a new furnace because of the severe winter we just experienced.

The bottom line is this: many of my colleagues on the other side of the aisle just don’t understand the complexities to operate a business and this unfortunately means that they struggle to understand economics. We face a deficit next year because costs continue to climb for pensions, human services, corrections, and debt.”

For the last four years, Democrats could have worked with Governor Corbett to solve these daunting issues and instead chose to do what they’re doing now – distorting the facts and complaining without offering solutions. Governor Wolf, yesterday, to his credit, chose to delay actions and wait until he gets to spend some time reviewing the budget in depth before offering any commentary.

I continue to stand by my statement that Pennsylvania does not have a revenue problem, it has a spending and expense problem.

For the benefit of all of Pennsylvania, the Democrats need to step up to the table and begin working on actually fixing problems rather than just criticizing and grand-standing politically.

Tax Hike Unnecessary For Pa.
Tax Hike Unnecessary For Pa.

Tax Hike Unnecessary For Pa.

Pennsylvania Cell Phone Tax

The big three taxes inflicted by the Commonwealth of Pennsylvania and its subdivisions are sales, property and income.

However, there are a host of sneaky little ones out there and they do add up.

Pennsylvania’s cell phone tax is 14.05 percent which is eighth highest in the nation. Washington State has the highest at 18.6 percent while adjacent Oregon has the lowest at 1.76 percent.

Note, this is on top of the federal 5.82 percent tax on wireless service.

A study  by the Centers for Disease Control found that 41 percent of American households have only cell phone service.

Pennsylvania Cell Phone Tax

Pennsylvania Cell Phone Tax

New Springfield High Plan Leaves Crowd Leary

About 100 persons spent two hours on a Thursday night hearing Springfield School District (Pa) officials detail plans concerning the fate of the high school.

Considering the questions asked, the consensus of the crowd in the auditorium on Leamy Avenue seemed to be “please don’t raise our taxes, we can’t take any more. ”

The officials led by School Director Doug Carney described the current state of things and went through four scenarios as to what to do about it. They were extending the life of the existing building via necessary maintenance, renovating the building, putting a new one  at the intersection of Leamy and Rolling Roads, and putting a new one  adjacent to the Saint Francis property on Saxer Avenue.

Carney noted the maintenance work to extend the life of the building would be far more expensive than most understood due to the asbestos roof, the ancient low-pressure steam heating system and pipes, and the simple pane windows that date to the 1950s.

The discussion was organized to clearly point to the district’s preference of a new high school behind Saint Francis Church, that would have more community athletic fields, parking and better traffic patterns.

It was noted that the building would be smaller than the existing one — the existing one is underused –and have geothermal heat.

Quite a bit of volunteer labor went into the study. The logic behind it is sound and those who did it deserve respect and praise.

However, the plea “we can’t take any more” trumps all.

The costliest of the plans was the one for a new Leamy Avenue building coming in at $150 million, followed by the one for renovating the old high school.

The new school near Saxer Avenue was pegged at $144 million, and the life-extension maintenance at $110 million.

This is a little lower than the costs initially presented in May.

For the most likely plans this translates to an ultimate tax increase of $171 per $100,000 assessed  for the necessary maintenance one which would mean  $250 per year more for a home assessed at the district average of $146,000; and  $273 per $100,000 assessed for the Saxer Avenue one or $398 per year for a home assessed at the district average.

Note the tax will not be implemented all at once but in frog boiling increments — now estimated at between  $26-$46 — over nine years until the max is reached.

In the question period, Carney said in response to rumors about the school district  seeking to buy Saint Francis, that the only contact it has had with the Archdiocese was a plan related to straightening Speakman Avenue, which the Archdiocese rejected.

He also noted that the district is considering unprecedented ways of raising revenue including selling naming rights to the school.

New Springfield High Plan Leaves Crowd Leary

New Springfield High Plan Leaves Crowd Leary
New Springfield High Plan Leaves Crowd Leary
New Springfield High Plan Leaves Crowd Leary
New Springfield High Plan Leaves Crowd Leary

Benefield Reveals True Education Spending

Kudos to Nate Benefield and the Harrisburg-based Commonwealth Foundation for finally starting to get the attention they deserve.

Commonwealth Foundation has long been doing the grunt work on describing the emperor’s non-existent suit by exposing the true cost of government spending — mostly in Pennsylvania — and the false claims about their effectiveness by their proponents who more often than not do pretty well by them personally.

Forbes.com published a column by Nate on Oct. 6 about how the vast majority of people don’t realize how much is spent on public education and that this is especially so in Pennsylvania.

He points out that three-quarters of resident in a recent poll underestimated the true cost of $14,600 with the average guess being 46 percent lower than reality.

He further noted Pennsylvania spends almost $3,000 more per student than the national average.

If the feudal propagandists in the old media told the truth the public obviously would be better informed.

If the Gov. Corbett recognized that he’d boldly and baldly have to go over their heads to tell it, he might not be in the fix he’s in.

Benefield Reveals True Education Spending

Philly Cigarette Tax Fails

Philly Cigarette Tax Fails
By Chris Freind

One can strongly argue that the greatest contribution of our city and state officials is comic relief. And that’s exactly what we have in Harrisburg, as 114 representatives, 39 senators and one lame duck governor just passed the biggest joke legislation in recent memory – an increase in the tax on cigarettes bought in Philadelphia to $2 a pack. The tax revenue is intended to bail out the Philadelphia School District – a black hole that sucks endless amounts of taxpayer money into its coffers – despite its monumental failure to educate.

And the cycle continues: even though the district has more than enough money (over $20,000 per student, per year, yet somehow that’s not “fair”), it cried poor, and, like clockwork, got rewarded with more funding by gutless elected officials. The tragic punchline? The district will continue to score an “F” on the only test that matters: our children’s education.

Any seventh-grader could tell you that the cigarette tax will not only fail miserably in achieving its goal, but will, in fact, hurt Philadelphians. Consider:

1. The cigarette tax will supposedly raise $49 million, though, not surprisingly, projections continue to change. Since the district maintains that it has an $81 million deficit, a gap still remains. And given that Philadelphia taxes damn near everything already, making it one of the highest-taxed cities in the country, what’s next?

2. How exactly is $49 million – out of a $2.6 billion budget – going to help improve anything? Answer: it’s not.

3. It seems like all the justifications we have heard for more taxes and more funding are rooted in saving jobs. But let’s be honest: A) the district is massively inefficient and bureaucratically top-heavy; thousands of jobs can, and should be, eliminated, and B) the only thing that matters is the children, but like always, much of the money never finds its way to the classroom, where it’s needed most. More money doesn’t educate children; accountable educators do.

4. This column has discussed common sense, free-market reform measures ad nauseam. None have been implemented (one of Gov. Corbett’s many failures), nor will they be, because too many politicians fear the teachers’ unions. Until the status quo is turned upside down, nothing will change. All the money in the world won’t improve a thing, and once again, the only ones who really matter – the students – take the hit.

5. The results for standardized state exams are in, and are right where you’d expect – in the toilet. They’re worse than last year’s scores, with reading and math achievement dropping even further. Bottom line: After spending two-and-a-half billion dollars last year, fewer than half of all students met state standards. That’s insane.

6. Republicans who voted for the cigarette tax either A) know it won’t solve anything but knuckle under to pressure, or B) really think throwing more money into a bottomless pit will work. On either count, they deserve to be removed from office by the voters. Here’s hoping.

7. Now for the real world implications of the tax:

First, the anticipated revenue projections are a joke, and won’t come close to being met. Why? Because Philadelphia isn’t New York or L.A., where it would take an hour just to get outside the city limits to buy cheaper cigarettes. In Philly, it’s a quick drive to the surrounding counties where a pack of smokes is significantly cheaper.

And remember that Philadelphia already imposes an 8 percent sales tax (not 6, like the rest of the state), driving up the price that much more. Bottom line: smokers aren’t going to quit, but will simply buy their cigarettes elsewhere.

One wonders if the budget gurus factored in this “bootleg” factor of Philadelphians buying their cigarettes outside the city when they compiled their revenue projections.

Second, the tax will significantly hurt small business owners. Customers who normally bought their cigarettes (and numerous other things) at the corner store now will take their business elsewhere – a boon to convenience stores right over the border but a death knell to city shop keepers. And as they go by the wayside, so do jobs, as well as the income and property taxes they generate.

Nothing like putting more Pennsylvania small business owners out of business. One would think the job of the governor and the Legislature is to keep people employed and grow the economy, instead of forcing businesses to close, move out of state, and put people out of work. Guess not.

Rather than a “smoke” and mirrors approach, the governor and Legislature should have sent the message that enough was enough; instead of sending more blank checks to Philadelphia, it was time to finally overhaul a failed educational system. In doing so, they would have won the support not just of suburbanites sick of seeing their tax dollars wasted, but also the parents of those trapped in abysmal Philadelphia schools with no way out.

Instead, the promise of their new tax law will go up in smoke, and with it, another generation of lost children.

Philly Cigarette Tax Fails

Springfield High School Project Town Halls

Regina Scheerer has sent us the schedule for the six town halls that will be held for the proposed Springfield High School (Pa.) project the cost estimate of which is $150 million.

The first meeting is 7 p.m., Oct. 16 at the Springfield High School Auditorium, 49 W Leamy Ave, Springfield, PA 19064.

The schedule of meetings can be found here.

Note if  state law is changed the cost will drop by $30 million over night.

Springfield High School Project Town Halls

Springfield High School Project Town Halls

30 Million Dollars Found Money

30 Million Dollars Found Money

30 Million Dollars Found Money if Pennsylvania changes the law.

The Springfield School (Pa) District is pushing for a new $150 million high school that would add about $400 to the already crushing  and ever-increasing school property tax for the average homeowner.

Leaving aside the dubious necessity of the building, that cost could be cut by $30 million almost literally overnight simply by putting some ink on paper — or erasing some off.

Pennsylvania’s prevailing wage law adds 20 percent to cost of all public construction projects for absolutely no reason other than to enrich those whose wealth comes from playing politics and it is these who are the true “1% ers”.

So why not scrap a law that impoverishes 99 percent of us? Because 99 percent of us don’t like to play politics. We better learn. Springfield residents contact your state representative Bill Adolph (R-165), who has quite a bit of say in what goes on in Harrisburg, and let him know you can’t hurt anymore. Let him know your grandparents can’t hurt anymore. Let him know your children can’t hurt anymore.

30 Million Dollars Found Money

 

Blame GOP Along With Democrats

By  William Evans

The claim recently made that Southeast Pennsylvania’s GOP backed Corbett’s pension revamp rings hollow.  What the GOP fears is that Corbett is likely to be replaced by Tom Wolfe in the next election and some of them will go down with Corbett.

Frankly, it will serve them right.  If the GOP had truly supported revising the pension system for the teachers union and state employees they could have done it.  But instead they frittered away the days with no solution in sight and none on the horizon.

I think this indicates that these unions hold the GOP by the short hairs just as surely as they hold the Democrats.  The victim from the legislators recalcitrance is of course the public and most notably senior citizens living on fixed incomes.

To illustrate, Rose Tree Media school district in 2007 contributed $2.5 million to the teachers’ pension fund; this year 2014, the district is contributing $9.6 million, or an increase of $8.2 million – all taken from the pockets of already strapped taxpayers.  In 2024 the contribution increases to $11.5 million.  Please note that the amounts will be greater than these numbers because of the automatic increases in annual wages that teachers will receive over this time that increase the base on which the contributions are calculated.

The typical pension paid to RTM’s retiring teachers approaches $100,000 a year.  Many have pensions that far exceed that amount.  The school district’s administrators receive even more with the average exceeding $150,000 a year and the superintendent is already scheduled to get $180,000 per year.

Nobody in the private sector receives anything close to what the teachers’ union members get and yet the rest of us are forced to subsidize this scheme out of meager salaries and paltry retirement savings.

Frankly, I think there is no hope Pennsylvania will ever resolve this problem simply because the legislators in Harrisburg are feasting on the same system.  They can’t handle change.

Mr. Evans  is a member of Rose Tree Media Taxpayers United.
Hat tip Cathy Craddock

 

Blame GOP Along With Democrats

Blame GOP Along With Democrats

Pileggi Panders Property Tax Break For Senior Citizens

Pileggi Panders Property Tax Break For Senior CitizensDominic Pileggi Panders Property Tax Break For Senior Citizens

State Sen. Dominic Pileggi’s (R-9) bill freezing property taxes for homeowners over 65 years of age has been sitting around for a year but recently got some ink.

The bill is SB 299  and illustrates perfectly why  most who understand economics and government are not really fans of the Senate Majority Leader.

Pennsylvania has a debt of $128.073 billion or about $10,000 per person of which $50 billion concerns its mismanaged pension systems.

Freezing the tax for senior citizens would shift the inevitable pay-up to newlyweds, and people with kids in college and the unemployed of which there are 344,989.

And of course, the small business owner whether he owns his shop or rents.

The question we ask is why the fear to address the root causes, which are rather obvious.

You do not need a constitutional amendment to repeal Act 195 of 1970 which granted public school teachers the right to strike giving the sociopathic types that gravitate to union leadership the legal right to threaten children  for more money and power.

Nor is a constitutional amendment needed to end the prevailing wage mandate that adds 20 percent to the cost of public projects.

Nor should HB 1353, a bill that would change the pension plan for new public employees, be that difficult to pass.

State Rep. Steve Barrar (R-166), by the way, has informed us that his vote against HB 1353 was because it did not go far enough. He is pushing for a full 401 (k) type plan and not a hybrid one that would still allow some direct benefits.

He has a  point. Why should public employees get direct benefits that most of us don’t other than Social Security for which none  would begrudge the state workers from joining us in?

Should we really have to lose our homes or see our rents jacked up to pay for these goodies?

 

 

 

Birth Certificate Price Doubles

The cost of acquiring a duplicate birth certificate will increase from $10 to $20, tomorrow, July 1, reports State Rep. Jim Cox (R-129)

The new money will be used to help fund children’s advocacy centers and programs to help train “mandated reporters,” who are people that must report child abuse under Pennsylvania law, Cox says.

Hey, let’s hike the cost rather than seek internal efficiencies, right? All money is magic according to those who write our laws, it seems.

 

Birth Certificate Price Doubles

Birth Certificate Price Doubles
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