HARRISBURG, July 13, 2016 – State Sen. John Blake (D-Lackawanna/Luzerne/Monroe) today applauded the bipartisan work to finalize and pass the $31.5 billion 2016-17 state budget and all of the accompanying revenue bills needed to balance the budget.
“It was critically important that the legislature and the Wolf administration work together on this budget to avoid a repeat of the pain inflicted by last year’s budget impasse on our schools, our human service providers and our nonprofit community,” Blake said. “This is a responsible spending plan that makes significant state investment in all levels of education and begins to replenish state programs and services that had fallen victim to drastic cuts under the prior administration.”
The 2016-17 state budget, which includes an additional $200 million in basic education funding and an additional $4.3 million for Lackawanna County schools alone, became law at midnight Monday without the signature of Governor Tom Wolf. The budget also includes increases in essential early childhood education, special education, rape crisis services, domestic violence assistance, county child welfare assistance and support for state veteran’s homes and The Commonwealth Medical College.
“Not unlike many other K-12 public schools across the Commonwealth, our districts locally were in grave danger of closing their doors during last year’s impasse so the additional $4.3 million investment in Lackawanna County schools will relieve significant financial stress on our districts and also on our local taxpayers,” Blake continued.
Blake, a founding member of the Pennsylvania Military Community Enhancement Commission (PMCEC), also noted the significant $798,000 investment under the Base Realignment and Closure line item at the PA Department of Community and Economic Development (DCED).
“Tobyhanna Army Depot is the largest industrial employer and arguably the largest economic driver in northeastern Pennsylvania – with annual economic impact of $3 billion,” Blake added. “The investment in this year’s budget will ensure that we can continue to work to protect and enhance the military value of our defense installations at Tobyhanna and across Pennsylvania.”
The revenue bill, as well as other bills necessary to implement the budget, were sent to the Governor this afternoon after a report from a joint Senate and House Conference Committee and legislative approval in both chambers of the General Assembly.
“While I find the revenue package inequitable in the distribution of the burden – that is, it is more burdensome on working class and lower income Pennsylvanians than it is on business or higher income consumers – it does balance this year’s budget and importantly, 60% of the package is recurring revenue, which will assure a better fiscal climate moving into the next fiscal year while sending a signal to capital markets that we are serious about getting our fiscal house in order,” Blake said.
Another impactful provision included in legislation on the way to the Governor’s desk is a stipulation that expands eligibility for the state’s Community Reinvestment Improvement Zone (CRIZ), a powerful community revitalization tool for Pennsylvania cities. Under the new provision the City of Scranton will be eligible to apply to DCED and compete for a CRIZ designation.
“Since taking office, I have introduced legislation and fought to include the City of Scranton in the CRIZ program”, Blake said. “We are already experiencing a renaissance in downtown Scranton and if we are successful in securing a CRIZ designation we can accelerate the pace of economic growth and revitalization in the City.”
Another important provision added to the Education Code is language that grants the Scranton School District the option to switch from a gross receipts tax – known as the business privilege and mercantile tax — to a payroll tax in a revenue-neutral manner.
“The reforms to the Act 47 program that we passed in 2014 allowed distressed municipalities to seek court approval to switch from a gross receipts tax to a payroll tax in a revenue-neutral manner. Taxes on gross receipts are regressive and punitive to the business community – small businesses, in particular,” Blake explained. “This new provision grants the Scranton School District the option to make the same revenue-neutral switch to a more progressive tax.”
Blake noted, however, that it is only an option and there are no immediate plans to consider a switch at this time.
“The state is simply offering the Mayor and City Council – as well as the Scranton School District – additional local tax policy options,” Blake continued. “Considerable local research and data collection will be necessary before considering any changes.”
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