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Pa. must not delay measures to address revenue shortfall

Pennsylvania residents who thought the state's 2009-10 budget battle couldn't have been much worse might be dismayed to learn that the 2010-11 budget exercise could, in fact, be much more formidable.

If the state's November collected-revenue figure — more than 3 percent less than what was anticipated — is a harbinger of what lies ahead, this year's budget stalemate might even be seen as having been a picnic, even though today that might seem difficult to fathom.

Based on what is evolving, it's time for state taxpayers — and even more so, state lawmakers and the governor — to face the fact that the latest statistics reveal.

For state lawmakers, it's not too early to start considering possible — and proper — immediate remedies, especially finding ways to cut spending, rather than waiting for another crisis to evolve next summer.

The current fiscal year ends on June 30, 2010.

Unfortunately, judging from this and a number of previous years, it's unlikely that lawmakers and the Governor's Office will produce important early work that's necessary.

However, the one possible ace in the hole for preventing next year's budget-preparation exercise from becoming as contentious and long-drawn-out as this year's is the fact that most lawmakers will be up for re-election, and they won't look good in an embarrassing budget mess like the one that consumed this past summer and some of the fall.

In addition, state voters will be electing a new governor.

The November collected-revenue figure, announced Tuesday by state Secretary of Revenue Stephen H. Stetler, must be regarded as extremely troublesome, because it indicates that the state isn't anywhere close to emerging from the fiscal woes that engulfed the 2008-09 budget process.

According to Stetler, the state collected $1.6 billion in General Fund revenue last month, which was $56.8 million, or 3.4 percent, less than anticipated.

Fiscal year-to-date, General Fund collections total $10.4 billion — $217 million, or 2 percent, below estimate.

Sales tax receipts totaled $609.1 million for November, which was $52.7 million below estimate. But lawmakers and the Governor's Office are hoping the holiday shopping season will remedy that figure.

One significant bright spot in the generally dismal revenue report was the $65.4 million of corporation tax dollars that made their way to the state treasury. That total was $20.9 million above estimate, bolstering the year-to-date corporation tax figure for 2009-10 to $723.4 million — $28.7 million, or 4.1 percent, above estimate.

Meanwhile, the General Assembly still is locked in limbo over the casino table games issue; the longer that issue remains undecided, the longer the state will miss out on reaping financial benefits from those games.

That assumes that the games will be approved and also that introduction of those games doesn't seriously undermine the revenue earned from slot machine gambling — which is a possibility.

Looking at the state's total fiscal picture, however, the situation isn't encouraging; rather, it continues to be depressing. And, state leaders, in considering what steps to take to address the money shortfall, must acknowledge that federal economic stimulus money coming to the commonwealth is only temporary. The state won't have that money to help plug the below-par revenue collections for very long.

State residents, tired of the gloomy weather of recent weeks, might already be longing for spring. But they're not relishing the prospect seven months from now of reflecting on this year's ugly budget morass as a picnic.

State lawmakers must not ignore the troubling picture painted by Stetler's latest report. In fact, they have some serious thinking about how to start remedying the situation before the next budget debate begins — even before Stetler submits his December report.

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