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More Severe Environmental Funding Cuts Looming For 2009-10 Budget
Senate Republicans followed Gov. Rendell's lead this week by making significant, additional cuts to environmental funding, doubling the already deep $77 million cut the Governor proposed in the 2009-10 state budget by adding another $77.4 million in cuts.
 
The additional $77.4 million in cuts made by Senate Republicans were to the departments of Agriculture ($8.9 million), Conservation and Natural Resources ($19.1 million) and Environmental Protection ($49.4 million) and mostly to line items related to funding for personnel costs.
 
In February Gov. Rendell proposed cuts of $77 million-- $13.9 million at the Department of Agriculture, $6.9 million in the Department of Conservation and Natural Resources, $18.2 million at the Department of Environmental Protection and $22 million reduction in funding available for recycling. (Pa Environment Digest 2/9/09)
 
Funding for conservation districts under both proposals would be the same, but cut by 25 percent or $1 million. (Pa Environment Digest 2/16/09)
 
$10 million in funding for the Resource Enhancement and Protection Program (REAP) farm conservation tax credit program was preserved in Gov. Rendell proposal, but is uncertain in the Senate Republican budget. Senate Republicans said they would suspend $250 million in tax credit programs, but did not specify which ones. There are $324 million in tax credit programs included in the state budget, including $75 million to support movie and television production in the state.
 
The proposed cuts of $154 million do not include the transfer of $174 million from the DCNR Oil and Gas Lease Fund to the General Fund to help plug the deficit hole in the 2008-09 budget. These funds are proceeds from last year's leasing of state forest land for Marcellus Shale drilling
 
Funding cuts for 2009-10 therefore could total as much as $328 million.
 
Nearly A Billion Lost
 
In the last six years, $784 million in environmental funding has been diverted to balance the budget or pay for programs that could not get funding on their own. If these new cuts are included in the 2009-10 budget, it means that $938 million, almost a billion dollars, of environmental funding has been diverted to other programs. (Pa Environment Digest 12/29/09)
 
Here's the list of major funding diversions in the last six years--
 
-- $174 million from the DCNR Oil and Gas Lease Fund to the General Fund in 2009;
 
-- $324 million intended to support wastewater plant operations over the last six years to balance the budget;
 
-- $100 million in 2002 from the Underground Storage Tank cleanup insurance fund to balance the budget (although this is slowly being repaid over 10 years);
 
-- $52.7 million “one-time” diversion from the Keystone Recreation, Parks and Conservation Fund in 2006 to balance the budget;
 
-- $50 million in 2007 and 2008 from the Environmental Stewardship Fund, which supports mine reclamation and watershed restoration, to fund the Hazardous Sites Cleanup Program because there was no agreement on how to fund that program;
 
-- $50 million in 2007 and 2008 from the Environmental Stewardship Fund to pay debt service on the Growing Greener II bond issue and taking funding away from restoration projects each year for the next 25 years – reflecting a pattern of only environmental programs being required to address their own bond debt service;
 
-- $15 million from the Recycling Fund in 2008 to balance the budget; and
 
-- $18.4 million put into budgetary reserve in 2008-09 from the Department of Environmental Protection and Department of Conservation and Natural Resources.
 
Growing Greener Ends
 
Compounding the impact of all these proposed environmental funding cuts is the fact that Growing Greener II funding will run out next year leaving little or no state funding for mine reclamation, watershed restoration, oil and gas well plugging and other Growing Greener programs.
 
Senate Republicans
 
Senate Bill 850 (the Senate Republican budget bill) reflects and responds to Pennsylvania’s tough economic climate. The fact that state revenues came in nearly $1 billion below estimate in April shows that Pennsylvania’s economy hasn’t improved and that we are facing a potential total shortfall of $2.9 billion or higher by the end of the current fiscal year,” said Sen. Jake Corman (R-Centre) Majority Chair of the Senate Appropriations Committee. “Taking that into account, we developed a budget for Fiscal Year 2009-10 that looks to the long-term future of Pennsylvania and considers the Commonwealth’s economic vitality in 2015 and 2020, not just 2010.”
 
During a milder recession in the early 1990s, Pennsylvania experienced a similar catastrophic revenue shortfall when the Commonwealth amassed a billion dollar deficit and, in response, raised taxes by $3 billion. That response devastated the Commonwealth’s economic climate and reduced its competitiveness with other states.
 
“Unlike in 1991, Senate Bill 850 takes a different tack by making painful but necessary cuts and reductions in spending now as a way to hasten the revitalization of Pennsylvania’s economy, which is ultimately the most effective remedy for the Commonwealth’s budgetary woes,” Sen. Corman said. “We are working to position Pennsylvania for the future by making tough decisions today. The Legislature will be called on to share its burden of cuts as well – and we are committed to doing that. The General Assembly’s operating line items are reduced by about 10 percent. In addition, we are proposing that $100 million of the General Assembly’s reserves be redistributed into the General Fund.”
 
 
 
 
Democratic Reaction
 
At a press conference with key House and Senate Democratic leaders, Gov. Rendell said the Republican budget was robbing Pennsylvania of its future by cutting funding for education, job training and other programs.

Rep. Dwight Evans (D-Philadelphia), Majority Chair of the House Appropriations Committee, called the budget "just mean" and not about making the compromises needed to adopt a state budget.

"This budget proposal is full of misplaced priorities and lacks a clear vision for where we need to go as a state helping those at the dawn and dusk of life. It contains cuts so deep that it will take years for us to recover," said Senate Minority Leader Robert Mellow (D-Lackawanna). "This budget doesn't solve problems. It passes the buck to local school districts and communities. It would force local school districts to increase taxes by an astounding 5 to 10 percent – and spur layoffs of up to 4,000 school district workers."

Sen. Vincent Hughes (D-Philadelphia) estimated 3,500 state employees would have to be laid off if the Senate Republican budget ever became law.

House Minority Leader Sam Smith (R-Jefferson) told reporters this week Gov. Rendell's budget proposal would lead to a $13 billion state deficit when federal stimulus money expires in two years. House Republicans, he said, supported the Senate Republicans in adopting a no tax increase $27.3 billion budget proposal.

Farm Bureau

“Pennsylvania’s farmers ask for very little from the State Budget and already agreed to give up some program funding to help our Commonwealth get through these difficult economic times,” said Pennsylvania Farm Bureau President Carl T. Shaffer. “Earlier, we respectfully asked the General Assembly to restore $7.7 million to the funding recommended for agriculture by Gov. Rendell so farmers would not be taking a larger percentage of cuts than most other state programs.”

“What’s disappointing about the Senate Republican budget plan is that it slashes funding still more,” Shaffer said. “What’s even more troubling is that fundamental support for agriculture programs has been repeatedly reduced during the past three years when there was a surplus of dollars at budget time.”
 
Gov. Rendell’s proposed state budget would cut funding by 30 percent in 14 key agriculture areas identified by the Pennsylvania Farm Bureau, including agricultural research and technical assistance to help farmers implement environmental practices. The Senate Republican budget would cut funding by 50 percent, completely eliminating nine of the 14 program areas. Shaffer noted that all Pennsylvanians benefit from many of the agriculture budget items.
 
“Farmers are beginning to feel a disconnection in Harrisburg between how legislators view Pennsylvania’s largest industry and how they decide priorities,” Shaffer contends. “Many constantly say how important farming is to our state’s food supply, economy and the character of our Commonwealth. Yet it seems impossible for them to find a small amount of funding for agriculture programs in a $27 billion state budget.”
 
 
 
 
 
 
 
 
 
 
 
 

5/8/2009

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