Senate Sends Balanced

Amended HB 1416 Restores Student Aid, Higher Education Funds, Avoids PIT Increase

Today, the Senate amended and approved a balanced state budget bill which restores support for higher education and student aid without a personal income tax (PIT) increase, according to Senator Jake Corman (R-34), Senate Appropriations Committee Chairman.

The Senate-amended version of House Bill 1416 reinstates higher education and PHEAA funding to the General Fund and reduces overall spending by almost $2 billion from the version approved by the House on Friday, Senator Corman said.

The bill returns to the House of Representatives for concurrence.

“House Bill 1416 is now a balanced, responsible budget that does not require a broad-based tax increase,” Senator Corman stated. “House Bill 1416, as we received it from the House, was unacceptable. Their proposal to slice higher education and PHEAA out of the General Fund was a blatant, backhanded attempt to push through the Governor’s proposed PIT increase.”

As approved by the House, House Bill 1416 called for overall spending of $29.1 billion and did not account for the $1.3 billion in revenue necessary to cover a proposed special fund for State System of Higher Education (SSHE) universities, community colleges and PHEAA.

“Right off the bat, state spending in the House proposal was $400 million higher than what even the Governor requested. That is simply not fiscally prudent or responsible considering the current economic climate,” Senator Corman said. “In a thinly-veiled ploy to cover that spending increase, the House ripped that $1.3 billion from higher education for use in other areas of the General Fund. This tactic, holding higher education funding and student aid hostage to push a PIT increase, is callous and unacceptable.”

As amended by the Senate, House Bill 1416 reduces overall spending to $27.14 billion for Fiscal Year 2009-10. The plan includes the cuts proposed in Senate Bill 850, accepts the $500 million in cuts proposed by the Governor on June 26, and incorporates about $72 million in cuts, which were agreed upon by the four legislative caucuses and Governor. This amended budget also projects a zero percent increase in revenues.

“This budget fulfills the standards and conditions that Senate Republicans have maintained right from the start,” Senator Corman said. “It uses realistic projects for both revenues and expenses. I believe this budget is sustainable beyond this fiscal year and puts Pennsylvania on the path to move forward as the economy improves. Most importantly, this budget balances without the need for a broad-based tax increase.”

Anna Fitzsimmons
Phone: (717) 787-1377