HARRISBURG -- Facing a budget deficit that is a half-billion dollars and growing, Republican Gov. Tom Corbett on Tuesday proposed an austere spending plan for next year that would slash millions from state universities and revamp how counties receive aid for human-services programs.
The $27.14 billion proposal would bridge the state's immediate fiscal gaps, though the governor offered little to prepare for several challenges -- including pension and transportation costs -- for which he acknowledged solutions are sorely needed.
That budget, which sticks to Mr. Corbett's no-tax-hike pledge, is about one-tenth of 1 percent less than the plan approved last June -- a spending plan that cut about $1 billion mostly out of education and social services.
School districts would see a meager boost over last year, and the state police force would be able to train a new class of 115 cadets. But much of the remainder of state government would see reductions: disappearing cash grants for welfare recipients, state prisons tasked with containing their rising costs and cutbacks continuing for environmental programs.
"I bring before you a budget grounded in difficult realities but framed in the optimism that we are solving our problems," Mr. Corbett said in his remarks to state legislators, calling the spending plan "lean and demanding."
Democrats immediately decried what they said were hidden cuts that would be hurtful to the commonwealth's neediest residents.
"If you are on the low rung of the economic ladder in Pennsylvania, this government has its foot on your neck," said Sen. Vince Hughes, D-Philadelphia.
Top Republican lawmakers generally defended the governor's plan as reflecting the state's still-bleak economic picture and the more-than-$700 million shortfall projected by the end of June.
"This is very much a budget that fits the times we're in," said Senate Majority Leader Dominic Pileggi, R-Delaware.
About 200 protesters wandering the state Capitol hallways loudly disagreed even before they had viewed that massive plan. Clad in T-shirts that read, "Gov. Corbett, whose side are you on?," they shouted "Shame! Shame! Shame!" at Budget Secretary Charles Zogby as he exited a morning media briefing.
In his remarks, Mr. Corbett described last year's tough budget battle as victory, noting its on-time passage and the bridging of a $4.2 billion budget deficit without hiking any state levies.
Looking to the coming year, one of the largest changes he proposed was rejiggering how school districts and counties receive portions of their state dollars.
The administration is seeking to combine several funding streams that go to local schools into one comprehensive block grant. Mr. Corbett said increasing the use of block grants instead of allocating funds tied to specific uses would give much-needed flexibility to the local officials.
"Local districts know better how to spend and allocate resources than do bureaucrats in Harrisburg," he said.
Schools would receive one payment where they previously received separate payments for general costs, transportation and assistance for Social Security payments for school employees.
Seven sets of welfare payments, related to mental health services, homeless assistance and other programs, would merge into one new block grant.
That change could help counties juggle cases that involve a variety of needs, said Doug Hill of the state's county commissioners' association, as long as officials have enough leeway in using those dollars.
Allegheny County Executive Rich Fitzgerald favors the single block-grant concept, spokeswoman Amie Downs said Tuesday.
Mr. Fitzgerald, who took office in January, previously created several "vision teams" to come up with recommendations for improving county government, including how it provides human services.
The single block grant offers the potential to improve delivery of programs to aid children, families and the elderly, Ms. Downs said. "Rich wants to make sure that as much money as possible is going to services and that administration is efficient and effective," she said. "If that means more cooperation and consolidation, that is something we would look at."
But House Democrats said integrating those programs would disguise the reductions in county funding.
In combining those welfare programs into a single line, the Corbett administration also chopped 20 percent from that funding. Another $319 million in welfare savings would come from eliminating cash grants to disabled or sick adults and other medical assistance cuts, a move sharply criticized by social-services advocates.
House Majority Leader Mike Turzai, R-Bradford Woods, praised the governor for his approach on trying to limit welfare spending, saying "He recognizes that we need to make sure ... people can move up in society and do not become dependent on government," Mr. Turzai said.
The proposed cuts for three of the four state-related universities -- a 30 percent loss for the University of Pittsburgh, Penn State University, and Temple University -- were met with less enthusiasm. A new higher-education panel will review tuition costs at those schools and other state institutions in order to recommend a long-term funding strategy by mid-November.
Democratic Rep. Dan Frankel, whose Squirrel Hill district includes part of the Pitt campus, said that proposed $41 million reduction out of the school's $136 million allocation would be harmful to the Pittsburgh region.
"I don't object to the fact that the governor wants to look at how we fund higher education -- that makes sense to me," Mr. Frankel said. "But it looks to me to be justification for doing another 30 percent on top of 20 percent last year."
The system of state-owned colleges also would see fewer funds, with a 20 percent decrease proposed for those schools. Community colleges would lose almost 4 percent of their funding.
Nearly absent from his remarks was a plan for repairing the state's ailing and aged infrastructure system. Mr. Corbett last year tasked a commission with finding $2 billion in new transportation dollars, but he has yet to back any of those suggestions, which included increasing driver's license and registration fees or lifting a cap on the taxes on wholesale gasoline.
While he declined to detail a plan for addressing transportation needs, calling it "too large" for the annual budget debate, he did say he had developed "some workable solutions" that he plans to work on with the Legislature.
Sen. Jay Costa, the Democratic leader, said he was disappointed by the lack of focus on highway and bridge repairs. "We're putting our head in the sand," Mr. Costa said. "We need to do it now or never."
The governor also touted a new jobs plan that he said would be released in detail shortly. The plan, which he dubbed "JOBSFirst PA," calls for programs to match jobs with available workers, creating a single point of access between businesses and state government, and increasing grants for college and trade school students who are training for high-demand occupations.
He also continued the phase-out of a levy on business assets, known as the capital stock and franchise tax.
Bloomfield resident Georganne Koehler, who was among the Harrisburg protesters, said Mr. Corbett has been too favorable already to large companies. "He's still not going to make sure corporations are taxed properly," she said. "Because of that, school students may suffer, college students may suffer, the unemployed may suffer."
Meanwhile, environmentalists were critical of a proposal to empty the $38 million Keystone Recreation, Park and Conservation Fund in the operating budget, and of another round of cuts to the Departments of Environmental Protection and of Conservation and Natural Resources.
The DCNR budget again would see an infusion, $69.5 million next year, from the Oil and Gas Lease Fund, which receives money from rent and royalties paid by companies drilling on state-owned land.
"The one bright spot is that the governor did not remove the moratorium on new drilling leases in our state forests, and for that, we are very grateful," PennFuture president Jan Jarrett said.