Specter Library, Murtha Center Part of Pennsylvania's Budget

This week, Pennsylvania Gov. Ed Rendell will sign his eighth and final state budget (term limits prevent him from seeking re-election). The budget passed with no tax increase, and represents $1 billion less than Gov. Rendell requested. However, the budget merely passes the bill onto future years, and future generations, through accounting tricks and borrowing for egregious pork projects.

The budget relies on $2.7 billion in federal aid, including $850 million in Medicaid funds (FMAP) that has yet to pass Congress. Indeed, no one believes Pennsylvania will get that much, if any, as the legislation doesn’t have enough support in the US Senate. Gov. Rendell, along with Michigan Gov. Jennifer Granholm, New York Gov. David Paterson and others were in Washington last week to lobby for more federal aid.

The state will use $121 million from Tobacco Settlement Funds for teachers’ pensions, which will then be backfilled, and another $35 million from other one-time sources to balance the budget. Still unresolved are a projected $4 billion annual pension contribution hike and a $3 billion Unemployment Compensation Fund deficit.

Finally, the budget deal includes increasing the debt ceiling for the Redevelopment Assistance Capital Program (RACP) by $600 million.

RACP (pronounced R-Cap) is effectively state borrowing for pork barrel projects. RACP was created in 1993 with a debt limit of $700 million, but has been increased regularly, with the latest deal raising the ceiling to just over $4 billion. Separate legislation itemizes $300 million in new-debt financed projects under RACP, including:

• $10 million for “Philadelphia University, including the Arlen Specter Library.”
• $10 million for the “John P. Murtha Center for Public Policy.”
• Over $90 million in projects–one third of the total–for which the recipient is not even named, as reported by the news service Capitolwire (subscription).

With his final budget, Ed Rendell has both cemented his legacy–spending beyond his means while rewarding political allies with pork–and cemented two more monuments to Pennsylvania’s political aristocracy.