Thursday, January 26, 2017

Pennsylvania Facing More Fiscal Woes

Andrea Sears, Public News Service

Growing deficits and few reserves make Pennsylvania's budget problems worse than that of most other states. (Jason Burmeister/flickr.com)
Growing deficits and few reserves make Pennsylvania's budget problems worse than that of most other states. (Jason Burmeister/flickr.com)
HARRISBURG, Pa. – Pennsylvania is one of many states facing tough financial times, according to a series of articles examining issues facing state legislatures.

State of the States 2017 from Stateline, a project of The Pew Charitable Trusts, examines five policy areas, including maintaining health care if the Affordable Care Act is repealed, states' overall fiscal health and renewable energy.

According to Scott Greenberger, Stateline’s executive editor, the Keystone State's budget is in worse shape than most other states.

"It has very little in its rainy day fund, its reserve fund, and it is on pace for a $600 million budget shortfall in the coming months," he points out.

This year, 31 states are facing budget gaps. But with just two-tenths of 1 percent of annual expenditures in its reserve fund, Pennsylvania lags far behind many other states in being able to weather tough economic times.

Pennsylvania was one of the states that took advantage of the Medicaid expansion under the Affordable Care Act with the federal government picking up most of the tab. But with the possible repeal of the ACA, Greenberger says the state may face tough choices.

"If that money goes away, the question will be whether states want to continue to cover the people who benefited from that expansion or not," he explains.

One recent report estimated that ACA repeal could double the state deficit and cost 137,000 jobs.

As a coal, oil and gas producer, the state may benefit financially from renewed support in Washington for fossil fuels. But Greenberger notes that Pennsylvania also is one of the 29 states that has a renewable-energy standard.

"Which means that it requires that a certain amount of the electricity sold in the state comes from approved renewable or alternative sources," he points out.

State of the States 2017 gives examples of how states have dealt successfully with the challenges that Pennsylvania and other states now face.

The Pew Charitable Trusts provided support for this reporting.

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