Standing Up For Taxpayers

On July 27, the state Senate chose tax increases and borrowing as the only way they could find to fund the state budget. House Bill 542, the Fiscal Code portion of the budget, passed the Senate chamber that day by a 26-24 margin. Endorsed by Gov. Tom Wolf, this bill would do the following if enacted:

• Add two new taxes on your natural gas consumption.
• Increase taxes on your electric and telephone (cell and landline) bills.
• Borrow more than $1.2 billion.

In recent years, House Republicans have been standing up for taxpayers. We held the line against the governor’s repeated efforts to implement broad-based taxes and significantly increase spending. With that as a backdrop, it did not take long to realize the votes for passing these taxes along to Pennsylvanians do not exist in the House.

Leadership then challenged our caucus to produce an alternative to reaching even deeper into taxpayers’ wallets. A group of 16 rank-and-file members, a team of which we are proud to be a part, spent the majority of the summer taking on that endeavor. Contributions were made by legislators from Adams, Allegheny, Berks, Butler, Clearfield, Cumberland, Dauphin, Elk, Franklin, Indiana, Jefferson, Lancaster, Lebanon, Lehigh, Northampton, Schuylkill, Washington, Westmoreland and York counties.

On Tuesday, Sept. 5, our group unveiled the “Taxpayers’ Budget.” This proposal is the result of an in-depth examination of the state budget that uncovered existing taxpayer dollars already paid to the state but sitting idle in special government accounts that have inordinately high reserve balances. Accessing these accounts has been done before but never on this scale.

The group has performed its due diligence, vetting each revenue source through the Treasury Transparency Portal, House Appropriations Committee staff, House legal staff and the governor’s own budget documents. Some of the accounts are dormant, and have not seen any activity in recent years. Others have extremely high fund balances. All are much like bank accounts you may have, with a checking portion and a savings portion. There is money going in and out, but never breaking below a certain level.

Our team did a three-year lookback on these accounts as part of our scrutiny. We made sure the revenue we plan to access would not compromise one service, close one agency or cost one person his or her job. More importantly, the more than $2.4 billion we are proposing will close out the deficit carried over from the 2016-17 budget, balance this year’s budget AND balance next year's budget. To our critics, we are using one-time, surplus funds instead of borrowing $1.5 billion our grandchildren would pay off for a one-time use. We also have proposed enough funding options to create a surplus for this fiscal year and next.

The governor doesn’t endorse our plan and denies the existence of extra funds. He has, however, recently done what we propose to do. In August, Wolf transferred $700 million out of the Motor License Fund into the General Fund. He obviously knows a good idea when he sees one. Furthermore, the short term lending to the General Fund done by the state treasurer constitutes using special account surplus funds on which the General Fund is charged interest.

Members of the General Assembly are tasked with being good stewards of your hard-earned dollars. This proposal is simply what we SHOULD be doing and frankly have not. We cannot ask more of our taxpayers when there is a viable alternative. The Taxpayers’ Budget does not call for a tax increase or require one dollar to be borrowed. More details are available online at www.pahousegop.com.

This coming week, the state House is expected to consider our plan. While the Taxpayers’ Budget is the product of rank-and-file members, it comes with the endorsement of our leadership team. We are also starting to hear of support from colleagues on the other side of the aisle. At this stage of the game, there appears to be two choices – accept the Senate tax plan or come up with an alternative, which we think we’ve found. We simply believe it is unfair to ask our citizens to dig deeper in their wallets when what they’ve already paid is not being put to work.

Pennsylvania House of Representatives
Media Contact: Scott Little
717.260.6317
slittle@pahousegop.com