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Gov. Wolf's Budget Proposal Could Dramatically Increase Funding to Penn State, SCASD

by on March 04, 2015 6:00 AM

Pennsylvania Governor Tom Wolf wants to dramatically increase funding to public schools and universities, but his new budget proposal is already drawing fire from the Republican-controlled legislature.

If Wolf gets his way, both the State College Area School District and Penn State could see a windfall of state appropriations – but the extra money for Penn State comes with a catch.

And Republicans are pushing back -- claiming that taxpayers are the ones who will foot the bill.

During a Tuesday morning speech to members of the Pennsylvania legislature, Wolf said his budget will eliminate Pennsylvania’s $2.3 billion deficit while heavily investing in public schools and higher education and decreasing tax burdens for the middle class.

According to a source close to the Wolf administration, the proposed budget would increase state funding to Penn State by $49.6 million. Penn State’s state allocation for this past year was about $214 million, which would increase by about 23 percent to over $263 million under Wolf’s proposal.

Wolf did not specifically mention Penn State in his budget address, but said he plans to increase higher education funding by fifty percent.

“But those improvements come with a string attached,” Wolf said. “In return for these increases, today I am calling on our institutions of higher education to freeze tuition, and I expect them to answer that call.”

Penn State president Eric Barron has previously proposed freezing tuition at eight commonwealth campuses. University representatives were unable to speculate about how Barron would respond to Wolf’s call for a university-wide tuition freeze.

"We greatly appreciate Governor Wolf’s proposal to restore funding cuts to Penn State,” Penn State spokesperson Lawrence Lokman says in an email. “We recognize that this is the first step in the state budget process, and that the General Assembly will be closely examining this proposal.” 

And Wolf isn’t stopping with higher education. In fact, public education may have been the biggest focus of the governor’s budget address.

“Over the past four years, Pennsylvania took a step in the wrong direction by trying to balance our state budget on the backs of our schools,” Wolf said. “…And that is why the very first thing my budget does is restore the $1 billion in cuts to public education that occurred under the previous administration.”

Wolf said Pennsylvania currently only pays about 35 percent of the total cost of public education, which is lower than nearly every other state in the nation. His budget would increase state funding to public education to 50 percent while creating a funding formula to benefit school districts with high levels of poverty.

According to information available through the Pennsylvania Department of Education, the State College Area School District received slightly more than $18 million from the state in the 2012-2013 school year. That revenue was about 27 percent of the district’s $66.5 million educational costs, and about 15 percent of the district’s total expenditures of nearly $120 million.

Fifty percent of the SCASD’s 2012-13 educational costs would work out to over $33 million dollars, though the district’s expenditures have seen a gradual increase from year to year.

School district representatives did not return requests for comment, but have previously told StateCollege.com that the district’s 2015-2016 budget proposal could be directly impacted by the state budget. The school district’s budget will be approved by a final vote in June.

“We have six months to work through this, and there are always changes to the budget proposal as we learn more. We don’t even know Governor-Elect Tom Wolf’s state budget plans yet,” SCASD superintendent Bob O’Donnell said at a December school board meeting.

Wolf said much of his proposed increases to education funding will come from a new severance tax on natural gas extraction in the state, which he expects to raise over $1 billion annually. Wolf also plans to restructure corporate taxes to fix loopholes that he says are being exploited by corporations to avoid paying taxes.

“By shifting the cost of public education away from local districts, we are also going to drastically reduce property taxes,” Wolf said.

Wolf’s budget proposes increasing the state’s personal income taxes from 3.07 to 3.7 percent. The budget also proposes raising Pennsylvania’s minimum wage to $10.10 an hour and increasing the state’s sales tax from six to 6.6 percent.

Many Republican members of the legislature – including majority leader Jake Corman of Centre County – take issue with Wolf’s budget and what they describe as “devastating tax increases."

“The proposed Wolf increase to the personal income tax will cost families of four earning about $52,000 a year approximately $331 a year, which is more than one week’s worth of groceries,” Corman says in a statement. “Combine that increase with changes to the sales tax, and families will feel the one-two punch of this budget directly in their pocketbooks to cover the excesses of government spending.”

Corman tells StateCollege.com that he supports increasing funding to Penn State and other higher education institutions, but says raising existing taxes or creating new ones is not the best choice for Pennsylvania residents.

Corman believes that reforming the state’s pension system is ultimately the best way to free up additional dollars within Pennsylvania. He says that will be a focus of his in the coming year.

He also points out that there are not enough Democratic votes in the Republican-controlled legislature for Wolf’s plan to pass without revision.

“It’s great that the governor has laid out his vision, but he and the general assembly now need to sit down and have a reasonable discussion about the future,” Corman says.

Democratic state representative Scott Conklin, whose district includes State College, supports Wolf’s proposal. In a statement, he says the budget will benefit taxpayers and help “rebuild a broken education funding system.”

“The governor has laid the groundwork, the House and Senate will now pick up their batons, and every side must work to strike the appropriate balance,” Conklin says.

State representative Kerry Benninghoff – whose district includes much of the greater State College area – could not be reached for comment.

 

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Michael Martin Garrett is a reporter and editor for StateCollege.com who covers local government, the courts, the arts and writes the Keeping the Faith column. He's a Penn State alumnus, a published poet and the bassist in a local indie rock band.
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