Pa. senators return to Capitol, but budget deal remains elusive

HARRISBURG, Pa. (AP) — Pennsylvania senators returned to the Capitol today but with no agreements in sight on the 17th day of a stalemate on elements of the state government’s threadbare budget that, by all projections, will lack the tax collections to sustain it for an entire year.

Democratic Gov. Tom Wolf last week let a nearly $32 billion budget bill become law without his signature, even though budget negotiators say it is about $1.5 billion out of balance. Held up in the Legislature are measures to deliver approximately $600 million to Penn State, Pitt, Temple, Lincoln and Penn.

The governor says he wants a tax package big enough to avoid a downgrade to Pennsylvania’s bruised credit rating. That, according to negotiators, amounted to roughly $700 million to $800 million in annual recurring revenue.

Wolf initially floated in February a $1 billion tax package that has been ignored by leaders of the House and Senate’s Republican majorities. That package included imposing a new tax on Marcellus Shale natural-gas production, restructuring the corporate net income tax to ensure out-of-state businesses pay it and expanding the sales tax to a few more services, including commercial storage and custom computer services.

Wolf also wanted to impose a fee on hundreds of municipalities that receive state police coverage.

Now, negotiators say tax increases under discussion include basic cable service, movie tickets, bank profits, telephone service and electric service.

Senate Republican leaders are backing a revenue plan based largely on borrowing, with smaller parts of it relying on an expansion of casino-style gambling through the state’s licensed casinos and a tax package that is more modest than Wolf’s proposal, according to negotiators.

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