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State will need more tough cuts in 2012-13 spending plan

Pennsylvania residents who thought that the state would not witness a repeat of this year’s money crunch in the 2012-13 fiscal year are no doubt dismayed to learn otherwise.

With still about a month and a half before Gov. Tom Corbett introduces his new budget proposal for the fiscal year that begins July 1, state residents already have been told that balancing the new spending plan will be difficult.

And, with Corbett apparently determined to remain true to his no-tax-increase pledge, some — maybe most — entities relying on funds from the state have cause to be deeply concerned about what negative impact that they might have to shoulder.

That is especially true regarding the commonwealth’s public school districts, which have had to endure a significant state subsidy reduction for 2011-12 that resulted in many cost-cutting decisions, including employee furloughs.

Depending on the choices that the governor and General Assembly make in the weeks ahead, additional tough decisions might be necessary.

Spawning the fears about further deep cuts are indications that year-end tax collections might be $500 million less than anticipated.

Beyond that, the state’s public employee pension obligation will increase by $520 million, mandated welfare costs will rise, as will interest costs tied to borrowing for capital projects.

Thus, it’s estimated that cuts totaling $750 million might have to be identified in order to balance the state’s budget.

“While many folks thought that the budget that we just came through was a difficult one . . . in many respects, (next year) is going to be an even more difficult challenge,” said Charles Zogby, state budget secretary. “All of the easy things, the low-hanging fruit, as I like to say, has been picked.”

In anticipation of the coming budget-preparation difficulties, Corbett administration officials have asked state agency heads to submit memos showing how a 5 percent cut in their budgets would affect their operations.

Meanwhile, the administration has disclosed that some agencies’ spending will be frozen at 2011-12 levels.

As people across the state prepare for holiday celebrations, those impacted directly by the state budget have cause for uneasiness as well.

Likewise, there are grounds for taxpayers on the local level to be fearful, since state education funding cuts probably will impact local school tax millage rates — an unpleasant prospect amid the still-weak economy.

Those who didn’t look beyond the last year’s budget difficulties must acknowledge that 2012-13 is not looking like a return to fiscal health for state spending.

The commonwealth’s budget woes will only be solved by a combination of leaner state spending and private-sector economic growth.

Mere dismay won’t accomplish anything.

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