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Day of Reckoning: The 2011-12 Budget

Overview of the proposed budget for 2011-12, including spending cuts, tax collections, and anticipated shortfalls. Highlights of the budget themes and areas of concern. Includes details on education, healthcare, public safety, and various cuts in different sectors.

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Day of Reckoning: The 2011-12 Budget

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  1. Day of Reckoning: The 2011-12 Budget SEPA Coalition March 21, 2011

  2. 44 States Anticipating Shortfalls Going Into FY 11-12

  3. Over $3 Billion in Temporary Federal Funding Goes Away in 2011-12

  4. As Recession Ends, Tax Collections Beginning to Grow Again

  5. Current Year Surplus Expected

  6. Still Below Pre-Recession Levels

  7. OVERVIEW

  8. Total Spending: 2011-12 Proposed

  9. 85% of Budget is Education, Health, Public Safety

  10. Spending Drops to 2008 Levels

  11. Budget Themes • “Day of Reckoning” is here • Living within our means • No taxes, fees or revenue of any kind • Spending reductions with mandate relief • Limited environmental oversight “friction free” • Shared sacrifice • Private school vouchers

  12. SALE OF LIQUOR STORES MARCELLUS SHALE TAX What’s missing?

  13. Budget Resumes Business Tax Cuts • Business Bonus Depreciation Tax Cut ($200 - $400 M in 2011-12) • Research & Development Tax Credit Up • Capital Stock and Franchise Tax Phase-Out Resumes in 2012 • Film and Job Creation Tax Credits Down • Temporary Cut to Other Tax Credits Ends

  14. A Tale of Priorities • Education: -11% • Higher ed: -52% • DCED: -31% • Corrections: +11% • Parole: +6.3% • State police: +5.7%

  15. Education • $1.1 billion cut from basic education • $550 million (10%) basic ed line • $259 million Accountability Block Grant • $47.6 million EAP tutoring program • $224 million charter school subsidy • Special Education: • $1.0 billion, 3rd year • Early intervention • Up 9% to $198 mill

  16. Early Childhood Budgetary Reserve level • Pre-K Counts • Head Start ABG eliminated Pre-k classrooms 17,000 children in full day kindergarten in Philadelphia

  17. Education Cuts in Philadelphia • Basic ed formula: $104 million • ABG: $ 56 million • EAP: $ 18.7 million • Charter school: $112.5 million • SIG: $ 5.9 million TOTAL $ 297.2 million

  18. Libraries and Literacy • State Library • 54% reduction since 2008-09 • Public Library subsidy • Held harmless • Down 30% overall • Adult Literacy • Down $2.5 million • 46% cut since 2008-09

  19. Higher Education

  20. Community Economic Development • $224 million total • Down $104 million • Down 64% from pre-recession levels • Cuts Housing/Redevelopment Assistance • Eliminated HEMAP • Combined WAM programs • Eliminates industry specific programs

  21. Human Services not Spared • Human Services Development Fund: $23 million eliminated • BHSI: Down $1.01 million (split) • County Child Welfare: 2% reduction • 3% reduction Title IV-E out of home placement • Homeless and rental assistance: level funded • Hospitals: $330 million State and Federal cut • Haircuts

  22. Continued reductions in services • Mental health and intellectual disabilities • Mental health services state increase but expiring ARRA causes small reduction • Behavioral health services: down 2% • No funding for waiting lists • Autism services federal funds cut

  23. DPW COST SAVINGS

  24. Welfare and Cash Assistance • Work First Orientation • New Directions: -50% • County Assistance:-$15 million redirect E&T • Cash Grants: -$26 million for Employment & Training • Supplemental payments: • Essentially flat funded

  25. Shift of Tobacco Settlement Funds • Public Welfare • MAWD • Long-term care • Home/Community Services • Health Department • $74 million • Total increase: $61.5 million $130 million from Tobacco Settlement Fund diverted to the Liberty Loan Fund

  26. Assessing the Budget • FEAR • RELIEF • REALITY

  27. Timetable: May 31 vote

  28. The Legislatures Response • Senator Scarnati: Marcellus impact fee • Governor Corbett: $27.3 billion spend • Senator Corman: Higher ed. cuts too deep • House Republicans: welfare budget too high • No money for General fund • Spending limit even if revenue up? • Where does the money come from • Look for cuts here

  29. Alternatives

  30. The Choices • Marcellus Shale: $200 m • Other tobacco: $42 m • Bonus deprec. $235m • CSFT: $90 m • Delaware loophole: $600 • Recapture Bush tax cut: $330 million • Penn State, CC • HSDF, Literacy • State system • Pitt and Lincoln • Basic ed, LTC • ABG, Temple

  31. What you can do Join SEPA Coalition Get info from Better Choices www.betterchoicesforpa.com Get Active! May 3rd Rally at the Capitol www.clearforpa.org for bus information

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