Due to the uncertainty surrounding Pennsylvania’s fiscal situation created by the response to the COVID-19 pandemic, Gov. Tom Wolf and the General Assembly proposed a 5-month, “provisional” budget in May 2020. At the time, Americans for Prosperity-Pennsylvania outlined numerous targets for spending reductions, as raising taxes, especially during the economic crisis created by the state’s response to the pandemic, would only serve to further depress economic activity. Nevertheless, an agreement was reached to fund state operations through Nov. 30, which—not so coincidentally—is the final day of the 2019-20 legislative session.
The portion of the 2-year Pennsylvania legislative session that remains after Election Day in the second year of the session is referred to as the “sine die” session, or “without day” in Latin, indicating that the session will adjourn for the final time as the session is complete. It’s also referred to as the “lame duck” session because officeholders who will not return for the next legislative session, due to retirement or being defeated for re-election, are still eligible to vote on legislation.
In recent years, there has been an effort to avoid doing any substantive legislative business in the sine die session, due in part to the stigma associated with the lack of accountability to voters it encourages. For example, in 2006—the year of the last sine die session before Senate Republican leaders banned it in 2008 and 2010 (House leadership followed suit in 2012 after Republicans regained the majority)—189 laws were passed. More than a quarter of those (48) were passed by one or both chambers or signed by then-Gov. Ed Rendell during the sine die session. The numbers were even worse in 2002 and 2004 under former Republican Gov. Mark Schweiker and Gov. Rendell, respectively, as 43 percent (103 of 237) of laws passed in 2002 and 59 percent (140 of 239) of those passed in 2004 were finalized during those sine die sessions.
Now consider this: While Pennsylvania’s Constitution mandates that annual budgets be completed by June 30, the Commonwealth’s elected officials have a lengthy history of disregarding that deadline. A common thread running through many of these overdue budgets is the issue that is likely to dominate the resumption of this year’s budget process: Whether or not to raise taxes. A brief travel back in time is in order.
- In 1969, Gov. Raymond Shafer and the General Assembly engaged in a 247-day standoff over Shafer’s attempt to institute the first state income tax.
- In 1977, Gov. Milton Shapp’s proposal for a 1 percentage point increase in the sales tax, an increase in wage taxes, an increase in the personal income tax, or some combination of revenue-raising measures resulted in a budget battle that was not settled until four days before Christmas and, according to the Pittsburgh Post-Gazette, featured “6,700 state employees going weeks without paychecks, labor unions organizing daily walkouts, and a melee on the House floor when a few representatives came to blows with each other and protesting welfare recipients. The University of Pittsburgh’s then-Chancellor, Wesley Posvar, even threatened to close the university during the fall semester.”
- In 1991, Gov. Robert P. Casey, Sr. and the General Assembly didn’t come to a budget agreement until early August. The deal ultimately contained $2.85 billion in new taxes, including a 50 percent increase in the personal income tax and an increase in the corporate net income tax to 9.99 percent—both severe blows to Pennsylvania’s economic competitiveness.
- Gov. Rendell’s tenure was marked by numerous extended budget battles, including in 2003, which saw negotiations continue into December and resulted in a 10 percent hike in the personal income tax, as well as 2007 (which saw a one-day furlough of 24,000 state workers) and 2009 (which lasted 101 days).
- Finally, Gov. Tom Wolf’s first budget (in 2015) was met with fierce opposition due to his insistence on imposing a severance tax on the natural gas industry, as well as increases in the state personal income and sales taxes. The budget was not completed until March 2016.
All of the above examples, however, are from budget years beginning in the first year of a two-year legislative session. The situation we currently face in Pennsylvania—the combination of an unfinished budget and a sine die session—lends even more uncertainty to the process. The 1982 budget was late, but it was resolved in July—far in advance of the sine die session. Over the coming weeks you’ll inevitably hear about recreational marijuana legalization and gambling expansion to generate new revenue or taking on debt or unified calls for additional federal stimulus or a change in CARES Act terms to utilize the aid yet unspent for the budget which without congressional action, can’t be done. What we’re calling on lawmakers to do is pass a budget that reflects the reality of our situation. Let’s eliminate the favoritism as evidenced by our corporate welfare spending, let’s oppose any new or expanded taxes and let’s get PA’s economy fully reopened to foster immediate and real economic growth. If past is indeed prologue, with regard to both sine die and the Commonwealth’s budget, Pennsylvania taxpayers will need to remain vigilant—because the potential for November mischief is high. I’m Ashley Klingensmith, State Director with Americans for Prosperity. You can find us on Facebook by searching @PAAFP and on Twitter by searching @AFPPennsylvania.