More on Pennsylvania Budget
December 18, 2008
I blogged yesterday on Pennsylvania’s budget woes and Gov. Ed Rendell’s plan to fix the problem, which includes spending cuts, draining half of the state’s Rainy Day Fund, and $450 million in expected federal aid. But it seems I have overlooked an important point. Many in Pennsylvania are pointing out that the state Legislature is sitting on $200 million in a reserve account. The reserve account exists to hold the unused cash from the Legislature’s operating budget, and it has been growing for 15 years. Citizens and some lawmakers are calling on the Legislature to release all but $60 million to help reduce the state’s 2009 deficit, but resistence is expected.
It is worth noting that this money, combined with the other half of the Rainy Day Fund, would be more than enough to keep Pennsylvania afloat in 2009 without the help of the federal government.