‘Simple’ Bill Would Limit Spending Growth in Pennsylvania

Gov. Tom Corbett and fellow Republicans in the state Legislature have work to slow spending over the past four years, but poll after poll indicates the thrifty governor probably won’t win re-election against Democratic challenger Tom Wolf.

A bill moving through the state Senate, though, would make sure the practice of limiting the growth of state spending becomes law, no matter who is in the governor’s office or who controls the state House and Senate.

The proposed Taxpayer Protection Act would essentially force lawmakers to follow a formula when deciding how much to increase spending each year. Introduced by state Sen. Mike Folmer, R-Lebanon, the bill would limit the growth of state spending to either the average change in personal income, or the average inflation rate plus the change in state population over the three preceding years, whichever is lower.

Folmer said the legislation doesn’t cut state spending but, instead, limits the growth of spending.

“It’s a very simple bill,” he said.

Twenty-eight other states have spending control, revenue controls or both, enforced either by statute or their respective constitutions, according to the Mercatus Center, a market-oriented research center at George Mason University. That leaves Pennsylvania in the minority, Folmer said.

The right-leaning Commonwealth Foundation, a free-market think tank based in Harrisburg, has commended the legislation, pointing to Susquehanna Polling and Research’s 2012 finding that almost two-thirds of Pennsylvanians support limiting the growth of state government spending.

“The Taxpayer Protection Act promises Pennsylvanians a simple yet effective shield against unsustainable increases in state spending — and the tax increases that inevitably follow,”  Nathan Benefield, vice president of policy analysis for the Commonwealth Foundation, said in statement issued after the state Senate Finance Committee approved the bill earlier this month.

Pennsylvania’s general fund spending has ballooned by almost 90 percent in inflation-adjusted dollars since 1970, but that’s not the full picture, according to the Commonwealth Foundation, which points out spending from other state funds exploded by about 677 percent.

The Commonwealth Foundation found that total state spending has increased by $33.8 billion since 2000, but it would have increased by $17.8 billion with the restrictions from the Taxpayer Protection Act in place.

Folmer’s legislation would also place 25 percent of any extra taxes into a rainy day fund that could prove integral in case of budget deficits. Fifty percent of the extra revenue would be used to pay down the state’s unfunded pension liabilities; 25 percent would be returned to taxpayers.

If needed, lawmakers could also exceed the cap with a super-majority vote, but some still believe it could handcuff elected officials.

“I think this is a commendable intention, but I get concerned that in good times we would not be able to be in a position to render benefits back to the taxpayers of the commonwealth, and in bad times we might be actually constraining what the state can do in order to grow our economy,” said state Sen. John Blake, the Democratic chairman of the Finance Committee.

State Sen. Pro Tempore Joe Scarnati, R-Jefferson, knows the bill will cause “indigestion” for some lawmakers, but he said the past four budgets have been crafted with the legislation’s intent in mind, even if it isn’t law. But with Corbett trailing badly in the polls, budget discussions could be different next year.

“I’m willing to raise the flag and carry the flag,” Scarnati said. “I think this needs to get done just based upon my experience at the budget table and clearly my experience as a businessperson and running the family checkbook.”

Andrew Staub is a reporter for PA Independent and can be reached at Andrew@PAIndependent.com.  Follow @PAIndependent on Twitter for more.