A Closer Look at the State Budget

Shelley Aragoncillo |

Details of the 2012-13 state budget agreement have emerged with the release of spreadsheets Tuesday, and some details of the code language that will accompany the budget.

If you remember, last year’s welfare code bill, Act 22, gave unprecedented authority to Public Welfare secretary Gary Alexander to modify payments, contracts and in some cases eligibility for human service programs. This year’s welfare code bill promises some surprises as well.

First the Numbers

Total spending will increase by roughly $500 million over the governor’s proposal, from $27.139 billion to $27.656 billion. Spending will remain below the budgeted 2008-09 levels, despite four years of recession-driven increases in demand for services. This means that for the fifth straight year most state services will have to make do with less.

The final agreement largely follows the contours of a budget bill passed by the Senate, although there are a few notable changes.

Happy Days Are Here Again

The proposed budget restores some funding cut from the governor’s office and includes a $300,000 increase in the line for senators’ salaries and a $1.4 million increase in the line for House members’ salaries. Not a large amount, but who would have thought they would do an increase in an election year?

Another Knock for the Poorest

The General Assistance Program is gone. This program provides a modest, time-limited monthly benefit to 68,000 temporarily disabled adults. The cash grant line is cut by $152 million to just over $60 million in income support for very poor people. Notices will go out this week to individuals that their grants will end on June 30.

Block Grants for None

One of the governor’s programmatic priorities was to begin to block grant funding to local governments, including school districts and county human services. Block grants to school districts would create a heftier per-student funding “backpack” for students moving to charter or non-public schools through a voucher, a key gubernatorial priority. Many viewed the human services block grant as a trial for a broader Medicaid waiver that could limit funding and enrollment for health care services.

Both block grants are gone from this budget. The Senate rejected the school district block grant back in May, and under the leadership of state Representative Gene DiGirolamo, the House held firm in its opposition to the human services block grant. The budget restores the county services to their original lines, but the victory came at a price, a 10% cut to each of the seven human services lines. There appears to be agreement to develop a pilot program on the human services block grants, largely following the outline suggested by Representative DiGirolamo on Tuesday.

So Much for Bipartisanship

Bipartisan amendments added to the House version of the budget bill in June were largely wiped out, including additional funding for the Department of Environmental Protection and child care services.

Higher Education Held Harmless

This plan restores all of the governor’s proposed cuts to higher education, leaving Penn State, Pitt, Temple, Lincoln, and the State System of Higher Education at current year levels. Higher education is still recovering from the 20% or so cut to those institutions enacted last year. Negotiators said the universities have agreed to limit tuition increases this year, so parents should get a break.

Accountability Block Grants Survive

Deep education cuts enacted last year remain largely intact. Basic education funding is increased slightly, by $49 million, over last year. Accountability block grants (supporting full-day kindergarten and other early childhood programs) will be flat-funded at $100 million.