Pennsylvania Credit Rating Takes Hit After Budget Standoff

Pennsylvania Credit Rating Takes Hit After Budget Standoff

In response to the downgrade today, Wolf called for swift action to complete the state budget.

"Meanwhile, the House Republicans were leading the way as they uncovered billions - yes, with a 'B"! - in extra funds. "I have said repeatedly for three years that we must responsibly fund the budget with recurring revenues". "My budget proposal was balanced, cut more than $2 billion in expenditures and consolidated agencies, while also fixing the deficit". Their letter said further borrowing "creates an economic "moral hazard" that effectively increases the long-term risks to the commonwealth's finances" and that they were therefore "disinclined to support additional lending" to the state's General Fund. The credit rating agency lowered its rating on Pennsylvania's debt. Let the governor know you noticed his lack of responsibility in crafting a responsible budget while those who owed tax payments continued to meet their obligations on time. Governor Wolf and the Senate are at odds with the House on how to fully fund the budget that became law back in July, and reaction to the downgrade broke along those lines.

"For months, I have warned that a credit downgrade was looming", Gov. Tom Wolf said in an emailed statement. "If an agreement has not progressed by next week, I will be forced to take further steps to manage this situation".

The House GOP said the focus needs to be on tackling entitlement programs and corrections costs.

If the General Assembly had enacted the modest personal income tax increase Governor Wolf proposed in February 2017, not only would the budget be balanced this year, but there would be nearly no carryover deficit from last year.


Unfortunately, like it or not, fair taxation is the only realistic, reliable and stable method to balance a government budget.

"No doubt some Republican legislators and some advocates will say that the real cause of the budget deficit is overspending".

Democrats have accused anti-tax House Republicans for the downgrade, while House Republicans blame S&P and state officers who "refuse to pay bills". That means counting on another expansion of casino-style gambling in the nation's No. 2 commercial casino state, an expansion that lawmakers haven't even approved.

Wolf has said he expects there will be a compromise before the end of the month.

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