Pennsylvania budget stuck in deadlock

The deadline for Pennsylvania to pass its annual budget came and went 72 days ago, but the impasse in Harrisburg still has no end in sight.

The state constitution requires lawmakers to approve a balanced budget, and ideological differences over how to close the $3.2 billion budget gap have resulted in a deadlock.

Democratic Gov. Edward Rendell proposed increasing taxes to pay for the shortfall, whereas the Republican-dominated state Senate advocates spending cuts - making it difficult for the two sides to find a compromise.

This stalemate, however, is not unusual for the state - Pennsylvania's government has been unable to approve a budget by June 30 for the past seven years.

In the current economic climate, Pennsylvania is not the only state to have political deadlock over determining its budget. California also had a budget crisis and had to issue IOUs to state employees and other creditors until it could approve a final budget. And Connecticut passed its budget last week after months of heated debate.

However, Pennsylvania is now the only state that has not approved its budget. The state has been operating without a balanced budget for more than two months, the longest such stretch in decades.

At Penn, prolonged deadlock over the budget has provided uncertainty about the fate of the School of Veterinary Medicine.

The Vet School, which receives a large portion of its funding from the state, is anticipating between a 16 and 24 percent cut in its overall budget. These cuts, however, will not be finalized until the state's final budget is passed.

In previous years, state employees were given furloughs while compromises were reached. This year, however, all state employees would have been required to keep working, most without receiving compensation until the budget passes.

As the deadlock continued with no apparent end in sight, Rendell signed a bill into law last month that allows employees to be paid, but it left the budget more than $1.7 billion out of balance.

"What I am signing today is not a budget," he said in a press release. "I am signing legislation that will simply allow us to pay state employees who provide for immediate critical public health and safety services, and that will send negotiators back to the table to communicate, compromise and get real about delivering a true budget agreement for Pennsylvania."

The Pennsylvania Budget and Policy Center warned last month that a prolonged impasse over the budget could cause the closure of child care providers, the limiting of mental health services and the loss of thousands of jobs in the nonprofit sector.

Even Hollywood has become a victim of the deadlock. Filmmaker M. Night Shyamalan's upcoming movie Devil moved its production from Philadelphia to Toronto. The relocation was a result of doubt that the new budget would approve Pennsylvania's film tax credit, according to the Philadelphia Inquirer.

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