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FOR IMMEDIATE RELEASE
January 15, 2009

A Capitol Perspective
A column by State Senator Pat Browne
16th Senatorial District

Pennsylvania Faces Serious Challenges in 2009

The beginning of a new year always brings new challenges and 2009 will be no exception for the Pennsylvania General Assembly as we work to address the impact of the current fiscal crisis.

The signs of the Commonwealth's economic condition are crystal clear and have been for some time.  We have seen revenues coming in below projections on a monthly basis to the point where they now total $814.4 million, or 6.8 percent, below estimate.

That shortfall and the latest state labor statistics, which show Pennsylvania's statewide unemployment rate as well as those of Lehigh and Northampton counties, increasing to 6.1 percent and 6.7 percent for Monroe County,*** dramatically emphasize the need for greater fiscal responsibility and spending controls now and through the coming months.

It is essential that we not lose sight of the impact the economy is having on individuals, families and small businesses across Pennsylvania. Many people are now out-of-work and many others are struggling to make ends meet. We must remember that as we look toward addressing the revenue shortfall of the current budget and the spending that will be proposed by the Governor for the Fiscal Year 2009-10 budget.

The Governor's updated projection of a $1.6 billion revenue shortfall by the end of the 2008-09 Fiscal Year may be extremely optimistic amid the daily news of the financial troubles across the nation that have impacted the banks, investment firms, the auto industry and many other businesses, large and small.

It is important to remember that Pennsylvania's financial problems would be much more significant if it were not for the efforts made by the Senate over the past two years. The media, especially in Philadelphia and Pittsburgh, was quick to jump all over the Senate for what they saw as a 17-day budget impasse in 2007, even then forgetting that the Governor and his $2.5 billion in proposed tax increases were a major stumbling block to an agreement.

You can just imagine what our current economic situation would be if we allowed those tax hikes to pass and the Governor's spending increases to occur. Instead, the Senate held its ground -- despite tremendous pressure from the big cities -- and in the end, not one of those tax increases made its way to the Fiscal Year 2007-08 budget.

Last year, even though we passed a budget relatively quickly – especially under the standards set during the Rendell Administration years – the Senate was roundly criticized by several media outlets for not supporting the Governor's spending increases – particularly for new entitlement programs. Again, it looks like time and events have proven the wisdom of our efforts.

As Chairman of the Senate Finance Committee, I believe that it is essential that we use the same fiscal prudence now and take whatever steps necessary to mitigate the impact that the slowdown in revenues will have on Pennsylvania's economy, both in the short-term and the long-term.

*** Source: PA Dept of Labor and Industry

State Senator Pat Browne represents the 16th Senatorial District and serves as Chairman of the Senate Finance Committee.