Wolf Planning For Spending Freeze If Budget Isn’t Passed

Aug 23, 2017

If Pennsylvania’s $2.2 billion budget gap isn’t filled soon, Governor Tom Wolf is indicating the commonwealth could be heading for major spending freezes.

Wolf said Tuesday that the situation could be resolved if House Republicans would just agree to a Senate revenue plan that includes several new taxes.

Caucus leaders are, for the most part, staying mum on how their negotiations are progressing.

By Sept. 15, the governor said he either has to put spending for certain state programs on hold, or borrow more money from the Treasury.

And he doesn’t want to borrow without a balanced budget.

“I ran a business,” he said. “At some point the bank, or somebody, says you’ve got to stop doing this. We have ratings agencies out there that are about to downgrade Pennsylvania’s debt because of this irresponsible behavior.”

“The easiest thing to do is just get back and finish the job,” he added. “Everyone else has done this.”

The House isn’t scheduled to return until Sept. 11, and it’s unclear if they’ll have a compromise in place by then.

“I don’t know that they will come back before Sept. 11,” Wolf said. “There are some differences of opinion within the Republican caucus, evidently. I’m not privy to that information.”

He told reporters there is not much time to take decisive action—but also stopped short of confirming his own plans.

“At this point I’m going to do whatever I can to do the responsible thing,” Wolf said, when asked if he would freeze spending.

Wolf said he does have an idea of how much he’d have to freeze by Sept. 15, but wouldn’t give details.

The Treasury has projected the general fund will hit zero by the end of this month. A spokesman said Sept. 15 is the day a significant Medicaid provider payment is due, which would put the fund $1.6 billion underwater. However, payments can’t be made unless some additional revenue is found.

House Republican leaders say their caucus still disagrees about the tax increases in the Senate proposal.