State budget unresolved as deadline looms

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HARRISBURG -- Seven days and counting.

That's how much time remains for General Assembly leaders and Gov. Ed Rendell to reach an agreement before the deadline for a new $28 billion or so budget for fiscal 2008-09, which begins at 12:01 a.m. next Tuesday. If there is no deal, 25,000 state workers may be temporarily furloughed without pay, and state parks, libraries and driver's license centers would be shut down.

House and Senate Republican and Democratic leaders met for 90 minutes yesterday.

They didn't resolve all of their outstanding differences over the proposed 2008-09 spending package, but several leaders said slow but steady progress is being made.

"The soup is simmering but it's not boiling yet," said House Republican leader Sam Smith of Punxsutawney. "We are still massaging the numbers."

Rep. Dwight Evans, D-Philadelphia, chairman of the House Appropriations Committee, said it's still possible the new budget could be adopted by July 1 or a day or two later. One unsettled point is whether to use some of the $750 million Rainy Day Fund, money set aside for economic downturns, for next year's budget.

House Democratic leader Bill DeWeese of Waynesburg said that at least $500 million would remain in the Rainy Day Fund, while part of the other $250 million could go for education.

Republicans want to ease the blow of higher electric rates, now expected in 2010 and 2011 in many areas of the state because rate caps will expire. They want to stretch the rate increases over perhaps five years rather than just one or two.

Bureau Chief Tom Barnes can be reached at or 1-717-787-4254.


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