Wolf’s office: $1B tax bill will pass
HARRISBURG – Gov. Tom Wolf’s office said Friday it secured the support necessary to pass major tax legislation in the Republican-controlled House of Representatives in a crucial step toward ending a five-month budget stalemate that crippled some social service agencies.
Wolf’s press secretary Jeff Sheridan told the Associated Press Friday morning the office was confident forthcoming tax legislation will pass the House. A vote was possible as early as today, and could cap Wolf’s quest for a record increase in public school aid and money to close a long-term budget deficit.
The details of the deal have not been made public and remained unsettled Friday evening. House lawmakers briefed by the governor’s office said it revolved around an increase in the personal income tax, from 3.07 to 3.3 percent. Republican senators said the details were not settled and they continued to prefer a sales tax increase, from 6 percent to 6.5 percent.
“We are confident that we have the votes to pass this,” Sheridan said. “We look forward to this impasse coming to an end so we can move Pennsylvania forward.”
Sheridan spoke shortly after House Majority Leader Dave Reed, R-Indiana, told the AP he planned a tax vote today that is pitting House conservatives against Wolf, the Senate and Democratic lawmakers. Defying the House’s Republican leaders were moderates, largely from southeastern Pennsylvania.
A flurry of activity by the governor’s office, including telephone calls and meetings with Wolf, came after House Republican leaders turned against the outlines of a budget deal they helped negotiate last month with Wolf and the Senate.
On Wednesday, one week shy of the modern-day Pennsylvania record for a budget standoff, House Republican leaders tasked the Democratic governor with coming up with enough support to get an approximately $1.2 billion tax increase through the GOP-dominated House.
To pass, it will need 102 votes in the 203-member chamber. Top Democrats said at least 73 out of 83 Democrats will support it, meaning close to 30 out of 119 Republican votes are necessary to pass it.
“Until the votes go up on the board, we’re concerned, but we believe we’re there,” said House Minority Whip Mike Hanna, D-Clinton.
If it passes, a vote on the main spending bill could follow, with House and Senate votes expected through Sunday night, at least.
Some potential pitfalls remained.
Senate Republican support for a tax increase hinges on House passage of legislation to restructure pension benefits for state government and public school employees. Wolf agreed to sign it, but labor unions oppose it and anti-tax groups were working against it in the House as a way to defeat a tax increase.
Also, a bipartisan tax bill was not finalized Friday, and differences remained over whether a sales tax increase or a personal income tax increase would be the primary money source. It also was expected to increase taxes on cigarettes and banks, among other things.
“One little move, and that could change the dynamics,” said Sen. John Yudichak, D-Luzerne.
The income tax increase under consideration, raising it by 7.5 percent, would bring in about $700 million to $800 million a year. It would be the first change in that tax rate since 2004. A half-point increase in the sales tax to 6.5 percent would bring in the same amount. It has remained at 6 percent since 1968.
Rep. Stephen Barrar, R-Delaware, said the size of the tax increase being requested by Wolf shrunk dramatically since his multibillion-dollar request in March and it was important the stalemate come to an end.
“I think we need to take the compromise proposal seriously,” Barrar said.
Wolf, the Republican-controlled Senate and House Democrats are backing a $30.8 billion spending plan – a 6 percent spending increase – and the accompanying $1 billion-plus tax plan.
Wolf demanded a tax increase to help wipe out deep public school funding cuts made in 2011 while meeting counties’ requests for an increase in social services aid and narrowing a long-term budget deficit.
However, rank-and-file House Republicans last week stiffened against the bipartisan spending and tax plan.