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Pa. gets $2 billion credit line

Budget stalemate forces action

HARRISBURG — Pennsylvania government is borrowing from the state treasury to tide itself over until spring, officials said Wednesday, as it rushes out billions of dollars held up in an ongoing budget fight between Democratic Gov. Tom Wolf and the Republican-controlled Legislature.

The treasury has extended a $2 billion line of credit to prevent the state government from bouncing checks. The more than 50,000 payment requests made by the Wolf administration total about $6 billion, according to treasury officials.

Some school districts began receiving electronic payments from the state Tuesday and Wednesday. Philadelphia, the state’s biggest city, reported receiving $179 million this week, and the state’s second-most populous county, Allegheny County, reported receiving about $104 million.

The Wolf administration drew $1 billion against the line of credit Wednesday, officials said. The treasury’s loan, made from a short-term investment pool, carries an interest rate of 0.6 percent and payback is required June 30.

The treasury has billions of dollars more in short-term investments should the state need another infusion.

A chart released by the treasury projected the state government’s main bank account would plunge $3 billion into the red in early March, before spring tax collections pick up.

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