A budget stalemate in Pennsylvania moved into its seventh day today, with welfare checks and state payrolls held hostage and legislative leaders negotiating almost continuously against a Monday midnight deadline.
Most state spending has been frozen since Friday, the start of the fiscal year, under Pennsylvania's constitutional mandate for a balanced budget.
Gov. Richard L. Thornburgh has been sent a spending bill, which he says he thinks is too fat, and no tax bill to fund it. As legislators wrangle over tax proposals, the governor's clock is ticking. Under Pennsylvania law, Thornburgh has until Monday to sign, veto or unilaterally blue-line the spending bill now on his desk.
Meanwhile, a statewide group has filed a class action suit to force the state to resume welfare payments, claiming that because the payments are partly funded by the federal government, the state cannot withhold all benefits and that in any event, recipients must be notified of cutoffs.
About 145,000 checks, totaling $19.3 million, have been held, and nearly 18,000 state paychecks, totaling $19.2 million, have not been sent. Another payday will come and go Friday.
The budget is locked in a five-way round-robin of bargaining talks among four party caucuses--one each for the Republicans and Democrats in the two state houses--and the governor's office.
"It's a paradox. We are very, very close at this point, but also very, very far," said Charles Bacas, chief of staff for state house Majority Leader James Mandarino, a Democrat.
Pennsylvania is in some ways repeating recent federal budget fights, with a twist. The Democrat-controlled house has passed a spending bill that the Republican senate and chief executive say is too costly, and neither body of the legislature is willing to vote for taxes high enough to cover the expenditures. But Pennsylvania, unlike the federal government, cannot operate without a balanced budget.
Dozens of prospective spending cuts and tax increases have been floated here in the past two months, but most of the controversy--and the prospects for compromise--center on a Democratic economic recovery plan called "PennPRIDE," a slightly forced acronym for Pennsylvania Program for Recovery, Investment, Development and Education.
Originally proposed as a five-year $6.5 billion plan, PennPRIDE was whittled down to $380 million for the fiscal year that began July 1.
As compromise talks began this week, Republicans were saying that the program was still too expensive, and the Democrats were saying that they would not pass any tax bill without it.
Previously, Democrats pushed through the house an $8.1 billion spending bill that included the whittled down PennPRIDE. The Republican-controlled senate, which was widely expected to reject it, instead passed it untouched to the governor, but with a tax increase that fell about half of a billion dollars short of funding it. The house, in turn, rejected that tax bill, 181 to 15, with Republicans abandoning their caucus in droves.
Democrats say the senate-passed $451 million tax increase, once adjusted for normal spending growth, will do no more than finance last year's $235 million deficit. Thornburgh, who was re-elected in 1982, promised that there would be no deficit, and Democrats, who predicted it, are reluctant to help him out of his bind.
"We are saying to the Republicans, 'You only want us to fund the governor's deficit, so why should we play? If you would like us to support you on this, then let's talk about the economic recovery program,' " Bacas said.
Thornburgh has stuck publicly to his position that, as his spokesman, James Wiggins, said today, "The way to bring about economic recovery is not to load Pennsylvanians with a massive new tax burden."
But Republicans in the legislature have shown more flexibility behind the scenes. Sources close to the negotiations say that the best chance for compromise is to drop large PennPRIDE subsidies for education and distressed municipalities in exchange for the redistribution of existing aid. The final tax increase under such a compromise would almost certainly be greater than the senate-passed $451 million, which is what Thornburgh calls his maximum.