HARRISBURG, Pennsylvania Dec 5 Compared with
this time last year, Pennsylvania officials are feeling better
about the economy and are predicting a near half billion dollar
surplus and no tax increases when the fiscal year ends in June.
Despite the looming "fiscal cliff" in Washington,
Pennsylvania is projecting to end its 2013 fiscal year with a
$478 million surplus, Charles Zogby, Pennsylvania Gov. Tom
Corbett's budget secretary, said on Wednesday.
"We feel like we're in a better place," he said.
Pennsylvania is currently $59 million ahead of budget
projections despite a lower-than-expected revenue haul in
November, most of that caused by a $20 million drop in personal
income tax collections.
But without a remedy to the pending collision of expiring
federal tax breaks and spending cuts, Zogby said the
commonwealth would need to come up with another $300 million in
cuts to offset what would be the equivalent of an 8 percent drop
in federal funding.
Pennsylvania would have to trim spending on social services,
special education, community block grants, education for
low-income students and workforce investment programs.
Zogby said it is "probably unlikely" that state workers
would be laid off to make up for a loss of funding, but said it
would not be out of the question either.
"Potentially, furloughs and layoffs may be the outcome in
some areas of these spending restraint and cost-cutting
efforts," Zogby said.
This time last year, Zogby was voicing concerns about a $500
million deficit he feared could balloon to $1 billion. It did
not materialize, but the Corbett administration froze spending
by $160 million in January to preserve cash and the year ended
$168 million in the red.