New Sources of State and Local Revenue

Pennsylvania. faces a $5 billion budget shortfall in 2011-12: Loss of $2.5 billion in federal stimulus funds; $3 billion owed to the Federal government in unemployment payments; $800 million in rising pension funds. We cannot afford to turn our back on these huge potential savings and revenue producers.

Examples:

• Repeal the Delaware Loophole will produce an estimated $500 million per year.
• Enact a Severance tax on gas drilling which will generate over $600 million by 2014.
• Close the property tax loophole for gas drillers. Only Pennsylvania exempts gas drillers from paying local property taxes, and the exemption is based on a technicality in the law that the Legislature has refused to address. Closing this loophole will produce more than $600 million in additional revenue for the municipalities and school boards in the 35 counties affected by drilling. This revenue is badly needed to help repair damage to their infrastructure caused by the enormous trucks carrying heavy equipment to the drilling sites. Currently those communities are bearing those costs rather than the drilling companies which are causing the damage.
• Enacting universal healthcare will generate billions of dollars in savings for the citizens and businesses of the Commonwealth. Our various governments and school boards would realize more than $2.3 billions in savings versus what they currently pay to provide health insurance for their employees.
• Downsizing the bloated staff of the Pennsylvania House and Senate could save as much as $100 million per year.
• Eliminate "vender discounts" that allow retailers to keep 1% of the sales taxes they collect, in order to cover the virtually non-existent cost of collecting and reporting those taxes. Eliminating these "discounts will generate $70 to $90 million per year in revenue. Pennsylvania is one of only 26 states that allows a vender discount and one of only two that does not cap it.
• Pennsylvania is the only state that does not impose an excise tax on all tobacco product and the only one that does not tax smokeless tobacco. The Legislature has consistently voted down attempt to initiate such a tax which would generate an estimated $41 million to $70 million per year in additional revenue.
• The elimination of Walk Around Money or WAMS, slush funds controlled by the Leadership, will reportedly return more than $200 million to the General Fund including $64 million appropriated in the current budget.
• Lowering our prison population by as little as 1% could generate $200 million in savings per year and reduce the odds that first offenders convicted of non-violent crimes will be transformed into violent criminals while incarcerated. It costs our state about $3.50 per day to keep a non-violent offender under close supervision, and about $104 per day to keep them in pr
ison. Maintaining our prison system now consumes 8% of the State budget - nearly $2 billion per year. The cost is also spiraling upward at an unsustainable rate.
• An Auditor General report recently estimated that better enforcement of state vehicle policy could save as much as $18 million. Reducing the size of this 16,000-plus vehicle fleet would undoubtedly save even more.
• It has been estimated, based on a recent report from the state Auditor General that removing waste, fraud and abuse from the Department of Public Welfare (DPW) could save taxpayers more than $380 million annually. Some estimates place that amount at more than $500 million.
• Some estimates suggest that government contracts - often won without competitive bidding - are responsible for more than $2 billion in annual over-payments and fraud.

  The options outlined here represent well over $5 billion in combined savings and revenue and will enhance the health and welfare of our population without raising their taxes. I will fight to bring these vital changes about.