Government & Politics
10:30 am
Thu December 19, 2013

PA Budget Chief Warns of $1.4 Billion Budget Shortfall Next Fiscal Year

The governor’s budget secretary is warning if the current financial picture holds, the commonwealth could face up to a $1.4 billion shortfall in the next fiscal year.

Charles Zogby said the budget deficit is due largely to rising personnel costs like health care and pensions.

But a reduction in federal funds for medical assistance and cost increases in the state’s prisons system are also contributing to the gap.

Zogby said the Corbett administration is still trying to avoid cuts.

"Certainly in critical areas like basic education, supports for the intellectually/physically disabled, seniors, those, from the governor’s standpoint, are not areas that we’re going to be looking at in terms of program reductions," he said.

The news of the large shortfall comes at the mid-point of the fiscal year, less than two months before the governor is scheduled to propose next year’s spending plan.

Zogby said the administration is urging lawmakers not to rule out possibilities for raising revenues — similar to the recent legalization of small games of chance in bars and taverns.

The move is expected to bring in $156 million annually in new revenue to the state.