Pocono News Section

Governor Rendell Releases 2010-2011 Budget

Governor Rendell Releases 2010-2011 Budget - Tuesday, February 9, 2010 at 6:40PM EST

Reported by: Eric Deabill
Tuesday, Feb 9, 2010 @ 06:40pm EST
HARRISBURG, DAUPHIN COUNTY - Governor Ed Rendell released his 2010-2011 spending plan Tuesday morning in Harrisburg. The $29 billion spending plan has no broad-based tax increases but holds the line on spending.

The governor's budget announcement comes after it took 101 days to pass a spending plan last year. Many different programs and services were slashed.

"The truth is we have cut nearly to the bone," Governor Rendell said. "While I know we will certainly hear familiar calls to cut simply spending as a way to balance the budget, I want to put everyone on notice that I will challenge anyone who makes a claim to specifically identify the cuts they propose and explain the real implications of those cuts for everyone to examine."

The key component of the governor's plan would be to drop the state sales tax from six-percent to four-percent but apply it across the board to sweets, tobacco and other services.

The governor also called for a tax on natural gas drilling but an increase in education spending by $354 million dollars.

"The sales tax is a testament of the power of lobbiests and special interests," Rendell said. "There is little rhyme or reason why we tax some items and services and wholly-exempt others. Except in the past someone effectively lobbied to secure favored treatment for themselves at the expense of others."

Almost immediately after the spending plan was released, Republicans started to criticize it.

"When times are bad, government must live within its means and we're not doing that right here," State Representative Mario Scavello, (R)-176, said.

Republicans from northeast Pennsylvania were most critical about the sales tax proposal.

"When you take it across the board and include the 75 items that he's proposing to go in, we're going to be paying more taxes. It's a tax increase," State Representative Garth Everett, (R)-84, said.

Rendell says the changes are necessary to ward off a fiscal tsunami in the future. He says if nothing is done now the state will be billions in the red down the road.

Even within his own party though, Governor Rendell may face some opposition to his plan.

"I do not object to the expansion of sales tax on some items but I do have a problem with taxing legal and accounting services," State Representative Phyllis Mundy, (D)-120, said.