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Budget outlook gets gloomy, screams for fresh revenue source

2 min read

Pennsylvania's budget news gets more grim with each passing minute.

The latest projections of the state Legislature's Independent Fiscal Office show a potential shortfall of nearly $3 billion through next summer.

That's up from a previous projection of $2.2 billion, but the office has revised tax collections downward by nearly $600 million based on current trends.

At the same time, Gov. Tom Wolf is promising a balanced state budget without a broad sales or income tax increase.

We appreciate the marked change in attitude and philosophy from the previous two years. But there is only one way to deal with the fiscal office numbers and produce a balanced budget with no broad tax increases. That would be with significant spending cuts in some portions of the budget.

The devil is definitely in the details when it comes to that.

Of course, while bean counters lament the lack of new revenue in the state coffers, there is an elephant in the room being avoided that could produce long-term fresh revenue.

That would be privatization of the liquor system that includes sales of private operations licenses.

The latest tweak to liquor sales rules, instituted a few weeks ago, allows beer retailers to sell any quantity, including individual 32-ounce bottles, six-packs and growlers.

That's new freedom for the state's 1,200 distributors and follows other nips and tucks to the liquor sales system, mainly in the state's grocery stores.

This series of changes debunks any claim to principle as a rationale for the state's stubborn maintenance of a public liquor store system. What the changes signal is that the refusal to just convert the public system to a private one and take the private licensing revenues is just political - it's an outdated protection of a public employee union.

Make the break and take the long-term revenues, which the state desperately needs, with the knowledge that the same employees are likely to be working in the same stockrooms.

Starting at /week.