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For Immediate Release: February 15, 2023 Contact: Kirstin Snow, Communications Director, Pennsylvania Budget and Policy Center snow@pennbpc.org
RELEASE: New Data — Update on Pennsylvania’s Fiscal Status and Surplus for 2023; Looming Deficits AheadIncludes impacts of the recent Commonwealth Court school funding lawsuit Harrisburg, PA—Today, the PA Budget and Policy Center released new data examining the Commonwealth’s multi-billion dollar surplus and what it means for budget allocation, and the impacts of the recent Commonwealth Court school funding lawsuit decision, which declared PA’s current education funding system as unconstitutional. Marc Stier, director of the PA Budget and Policy Center, and Diana Polson, Senior Research Analyst with the Keystone Research Center, presented their policy brief and explained the state’s current budget surplus, and looming projected deficits. In delivering his remarks, Stier said, “The fiscal status of Pennsylvania is almost paradoxical. We have a huge surplus of more than $13 billion. Yet we are likely to have recurring budget deficits starting next year and critical needs for additional state spending, especially for full and fair funding of K-12 education. The huge surplus creates a temptation for politicians to avoid making hard decisions. But it also provides an opportunity to use the surplus and modest addition to revenues now to meet the needs of the state over the long term.” EXCERPT: The enactment of Pennsylvania’s current year (2022-23) budget was greeted with bi-partisan hosannas about the fiscal situation of the state. The projected budget surplus for the year was $5.27 billion and additional contributions to the Rainy Day Fund brought it to $5 billion. After more than a decade of budgets balanced with one-year funds and fiscal legerdemain, it appeared the state’s persistent budget difficulties were over. Unfortunately, our analysis shows that this is a partial truth. The state will have, we estimate, a combined $13.2 billion surplus at the end of the fiscal year on June 30. But the long-term prospects for the state budget remain problematic. In sum, the state will soon see a resumption of a structural budget deficit combined with the need for additional investments, especially but not only for meeting the constitutional requirement to fully and fairly fund K-12 education. The paper and the PowerPoint presentation are available online. Watch the presentation here. |