| Central Penn Business Journal
Should shale make up for Corbett cuts?
On the eve of Gov. Tom Corbett's second-annual budget address, many on both sides of the aisle as well as those dependent on state money in nonprofits, health care and education, are anxiously awaiting the spending plan.
There isn't much certainty except for this: Corbett's unafraid to make tough decisions — meaning making cuts — and he is steadfast on his campaign pledge to not raise taxes.
Last year, Corbett made good on that promise with a $27.1 billion fiscal budget that did not raise taxes and was below the former year's budget. It meant roughly $1 billion in cuts to education alone, however.
State revenue continues to lag, so this year's expectations shouldn't be any different.
Pennsylvania has collected nearly $500 million less in tax revenue than its 2011-12 budget calls for, with corporate and personal income taxes accounting for most of the shortfall.
One factor, however, is whether Corbett will look to Marcellus Shale to offset cuts. Last month, the governor said the legislature is nearing agreement on an impact fee plan for the Marcellus Shale. He continued to call on legislators to move quickly before his budget address.
A bill passed by the Senate would assess a fee at about 2.2 percent, according to an analysis by the Pennsylvania Budget and Policy Center. House Republicans have backed a plan that would amount to a 1 percent fee.
Is a fee on shale production the answer? And isn't it a tax?
Christopher Passante is the editor of the Central Penn Business Journal.