RPT-Pennsylvania's budget gridlock hits schools, seniors | Reuters
(Repeats story that ran on Thursday with no change to headlineor text)
* Largest senior service provider saving cash for food,staff
* School districts borrowing millions to stay open
* Governor, lawmakers still deadlocked
By Hilary Russ
NEW YORK, Oct 22 Pennsylvania's largest serviceprovider to senior citizens is running out of money and time, asthe state's new Democratic governor and Republican-ledlegislature still cannot agree on a budget.
"I'm saving the little bit of money we have to pay staff andfood. I can do that probably for a couple more months," saidHolly Lange, Chief Executive Officer of Philadelphia Corporationfor Aging (PCA).
Pennsylvania, whose 2016 budget was due 113 days ago, hasthe dubious distinction of being only one of two U.S. states,along with Illinois, without a current budget.
But even Illinois - the worst-rated state in the nation - isat least paying out education funding to schools.
"We feel completely isolated," said Joseph Gorham,superintendent of the Carbondale Area School District, of Pennsylvania's political stalemate. "It just doesn't seem atthis point that they understand quite how desperate we'vebecome."
The Pennsylvania logjam puts the state's most vulnerable -school kids, seniors, disabled, and the homeless - in the firingline, as some of their care relies on state funds that have notbeen released.
"Everyone has been feeling the pinch in some way, and it'sgoing to get worse the longer the situation goes without abudget," said Steve Robinson, spokesman for the PennsylvaniaSchool Boards Association.
For example, Carbondale's schools, in northeasternPennsylvania, were down to $11,000 cash last month, but havesince received local tax revenues that should last throughmid-November. Still, by then they will owe nearly $2 million indeferred pension contributions and payments to charter schools.
Altogether, Pennsylvania school districts have borrowed atleast $410 million to pay for operations during the impasse,said state Auditor General Eugene DePasquale.
"We don't see any settlement any time soon," DePasqualesaid. "You're getting close to a breaking point" in mid-Novemberfor the poorer districts that are more reliant on state aid.
The current deadlock is partly over how to pay for increasededucation funding. Democratic Governor Tom Wolf ousted one-termRepublican Governor Tom Corbett in November by promising torestore education aid with income tax hikes and a new tax onnatural gas extraction.
Republicans struck down Wolf's spending plan and disagreedwith his fix for underfunded public pensions. They passed astop-gap budget, but Wolf vetoed it on Sept. 29.
The gridlock has left a $2 billion state budget deficitunresolved and prompted Moody's Investors Service to revise itsoutlook on Pennsylvania's Aa3 credit rating to negative on Oct.16.
Republican leaders say Wolf is holding Pennsylvanianshostage to his tax proposals. Wolf says Republicans failed tofind meaningful ways to close the deficit or restore educationfunding.
Whoever is to blame, the PCA and other service organizationsare being left in the lurch.
The nonprofit has 700 staffers to provide services of itsown throughout Philadelphia city and county, and it contractswith 200 other providers of senior services, home care and adultday care. PCA supplies about 5,000 hot meals per day at seniorcenters, and another 4,000 daily home meal deliveries.
The PCA depends on about 70 percent of its funding fromstate sources, mostly lottery revenues. It has exhausted itsborrowing power with a recent $14 million line of credit thatallowed it to pay contractors in July and August. However, theyhave not been paid for September.
Even if it could borrow, that might be difficult, since thedelay in state payments contributed to Moody's Oct. 8 downgradeof PCA's 2001 municipal bonds by four notches to junk at Ba2.
The state will eventually release funding to PCA, Lange toldReuters. "But in the meantime it's a struggle and I'm concernedthat some of the services will not be available for thevulnerable seniors." (Reporting by Hilary Russ in New York; Editing by Daniel Basesand Diane Craft)
http://www.reuters.com/article/2015/10/23/pennsylvania-budget-idUSL1N12M3JE20151023
* Largest senior service provider saving cash for food,staff
* School districts borrowing millions to stay open
* Governor, lawmakers still deadlocked
By Hilary Russ
NEW YORK, Oct 22 Pennsylvania's largest serviceprovider to senior citizens is running out of money and time, asthe state's new Democratic governor and Republican-ledlegislature still cannot agree on a budget.
"I'm saving the little bit of money we have to pay staff andfood. I can do that probably for a couple more months," saidHolly Lange, Chief Executive Officer of Philadelphia Corporationfor Aging (PCA).
Pennsylvania, whose 2016 budget was due 113 days ago, hasthe dubious distinction of being only one of two U.S. states,along with Illinois, without a current budget.
But even Illinois - the worst-rated state in the nation - isat least paying out education funding to schools.
"We feel completely isolated," said Joseph Gorham,superintendent of the Carbondale Area School District, of Pennsylvania's political stalemate. "It just doesn't seem atthis point that they understand quite how desperate we'vebecome."
The Pennsylvania logjam puts the state's most vulnerable -school kids, seniors, disabled, and the homeless - in the firingline, as some of their care relies on state funds that have notbeen released.
"Everyone has been feeling the pinch in some way, and it'sgoing to get worse the longer the situation goes without abudget," said Steve Robinson, spokesman for the PennsylvaniaSchool Boards Association.
For example, Carbondale's schools, in northeasternPennsylvania, were down to $11,000 cash last month, but havesince received local tax revenues that should last throughmid-November. Still, by then they will owe nearly $2 million indeferred pension contributions and payments to charter schools.
Altogether, Pennsylvania school districts have borrowed atleast $410 million to pay for operations during the impasse,said state Auditor General Eugene DePasquale.
"We don't see any settlement any time soon," DePasqualesaid. "You're getting close to a breaking point" in mid-Novemberfor the poorer districts that are more reliant on state aid.
The current deadlock is partly over how to pay for increasededucation funding. Democratic Governor Tom Wolf ousted one-termRepublican Governor Tom Corbett in November by promising torestore education aid with income tax hikes and a new tax onnatural gas extraction.
Republicans struck down Wolf's spending plan and disagreedwith his fix for underfunded public pensions. They passed astop-gap budget, but Wolf vetoed it on Sept. 29.
The gridlock has left a $2 billion state budget deficitunresolved and prompted Moody's Investors Service to revise itsoutlook on Pennsylvania's Aa3 credit rating to negative on Oct.16.
Republican leaders say Wolf is holding Pennsylvanianshostage to his tax proposals. Wolf says Republicans failed tofind meaningful ways to close the deficit or restore educationfunding.
Whoever is to blame, the PCA and other service organizationsare being left in the lurch.
The nonprofit has 700 staffers to provide services of itsown throughout Philadelphia city and county, and it contractswith 200 other providers of senior services, home care and adultday care. PCA supplies about 5,000 hot meals per day at seniorcenters, and another 4,000 daily home meal deliveries.
The PCA depends on about 70 percent of its funding fromstate sources, mostly lottery revenues. It has exhausted itsborrowing power with a recent $14 million line of credit thatallowed it to pay contractors in July and August. However, theyhave not been paid for September.
Even if it could borrow, that might be difficult, since thedelay in state payments contributed to Moody's Oct. 8 downgradeof PCA's 2001 municipal bonds by four notches to junk at Ba2.
The state will eventually release funding to PCA, Lange toldReuters. "But in the meantime it's a struggle and I'm concernedthat some of the services will not be available for thevulnerable seniors." (Reporting by Hilary Russ in New York; Editing by Daniel Basesand Diane Craft)
http://www.reuters.com/article/2015/10/23/pennsylvania-budget-idUSL1N12M3JE20151023
