PA State Rep. Aaron Kaufer about the state budget with Rob Neyhard

Newsmaker Interviews
Wednesday, September 20th

PA State Representative Aaron Kaufer of the 120th legislative district talks to Rob Neyhard about the PA state budget and how to fund it.


Transcript - Not for consumer use. Robot overlords only. Will not be accurate.

Save represented Verron coffers scheduled to be on the shows so well. Representative cough urge my question do you now is now wide. Well I. Q so to wrap up the differences that are here between the house and the senate. Some I I believe that's what's going to happen there we're going to get together try to resolve this issue obviously it'd be a prolonged issue but. It's an insult sends back do we pass a budget back in April generate taxes balance the budget. And here we are because some last minute maneuvering and unfortunately that that we need to be done by the senate until last minute. Trapped in our laps without any plan to fund the budget. And it's really 88 K bad position to where the taxpayers are right now I'm being held hostage in this budget process. Because this is something we could have done way before the June 30 deadline here we are in the mid September still looking had better revenue plan to complete this. Roger what are some of the big differences between the house. Budget and but the senate wants to do. Well I leave the senate put forward the gross receipts tax that included. The new gas and natural gas electric increasing those as well. So they've they've put a 400 million dollar plan. For raising those taxes. Well and really what what we're looking to do is QQ what's called special fund transfers. Of money that has our. Already been paid that is not being used by by special fondness special department. That is sitting in the bank account going under utilized so these are taxes that people have paid so that's sitting in an account. Dad are not being utilized and felt that wouldn't affect get all current program as much indeed administration has been barking about. Because there's a difference between encumbered fund in an encumbered on Andy's. Unencumbered funds which have not been BI you'd like get airport into a project. Are defined that we're looking at cal. Pipe during the transfer this would cover our debt that we have dead dad has built over the over the last budget cycle front. Not passing gaming revenue and the senate what the post so. And it it has put them the ball in the court that we have to cover that you get from last year's budget. And this is day one time wailed covering a one time issue common to get everything catches this year well I. I've had it I've had a discussion with a lot of people who were opposed to this and hear the questions they bring up okay. First of all they they seem to think this is more like a shell game you know just robbing Peter to pay Paul. And the second the second concern that I've gotten from some people Liz. Like and you eat we call this money set aside sort of like slush funds. But isn't it earmarked on the road for projects or is this like a rainy day fund that's that's sitting there. It's like a rainy day fund you're exactly right I've heard people caught it flush fund that called it a rainy day fund. I'm gonna get a let me explain 11 finds here tonight I have the number of fund in front of me of what we're tight about killing. One of them that it is the big banking on that we have India and Harrisburg. That is thinking I'm glad you're had 27 million dollars. It grew out there for it grew from 27 million dollars to 35 million dollars this year it's crawling annually. At around eight million dollar rate. And so what we're saying is worse than we are taking in more money than we're spending in the respond. So we're taking more money is annually than we're sending him a spot in the fund balance keeps on growing its. And these money. This money is not earmarked for a project it's not already dedicated money so it is. These are encumbered fund. We can take this money without impacting any programs because it's not mark Freddie think we're bringing in more money than we're spending in these particular fond. And so there was a group of legislators it was about twelve legislators to sell I actually said in a one of their meetings. That put together going through deep special fund came up with 38 fund. Debt are kicking in more money than they're spending or the money is actually be utilized that falling crime projects or anything that is just them sitting in an account. So that we can come after these bond and take these crawling fund balances to be used. Which our tax dollars to be used to balance the budget. Now for example in the transportation fund who say we take. I don't say we take a hundred million dollars from the transportation fund. Well it wouldn't put that for example have an adverse affect on unsafe like LCD LC TA since we're loser in county. Now as felt any of those fund that is being discussed are not dedicated fund play it would not and I know that. I actually did speak a little bit with some of the people from LPGA about was. What the fines are what's being discussed. Kelly in the bill that would get past the B transportation fund would source fifty million dollars taken out of that. Doubt that fund was growing annually in the lead. We are cashing out point door there was it was just got to take 350 million dollars out of that fund and we actually reduced it down to fifty million dollars. But the fund would growing annually at a larger raid on the money that is sitting there not being used on transportation projects. And so the money that was coming in is newly crowned as we all know that dad can't dreaded again. Act out there wouldn't be there was more money being put into an account an action they they're actually being spent. And so that extra money that wasn't being utilized why would we tax people again per catch so already paying for the that it can be utilized. And and I talked on the show about possibly cutting programs to help this. Do we need to find all of these programs at the rate that we're funding Larry isn't there something that we could. Well yeah I use as an example like every week every month when you put your budget together we know that taxes go up we know that utility. You know to utilities go up our cable bills go up. And at some point in time each month we're gonna have to say well you know we're up to do without something is there anything in Harrisburg that. That we can actually say you know what we're gonna have to we're going to have to do without such and such. Now I I greatly that's exactly where the conversation need to go. And that has not been way the conversation that's what we did with a budget that budget would actually would not only balance this year's budget it would balance next year's budget. Given that the two year option to actually look very systematically at what programs are absolutely essential and what programs we actually cut now. I think a lot of ideas out there we have the race horse development fund 250 million dollars that goes out to funding to increase purses for race horses. And money to help attract dead deep debt and casino. There's been talk that taking that 250 million dollars to balance the budget which you know do we need to be subsidizing. Their race horse pond in Pennsylvania. The other proposals out there you know we have tax credit that don't tax credit in the millions of dollars in data cash credit that we need offer. Or is that something that we can recoup the revenue on that as well so. There's weighed in I personally believe this conversation is going to read some points. Over the either disappear over the next couple of years where there will need to be a combination of cuts and revenue increases. Because not only are we looking at this annual budget. But we see that the tension caught they're going to continue to grow over god this year and next here and potentially be hereafter until we reached. That peek at where we have to pay for the next 37 years. But not only that as much as we continue to talk about pensions. That we also had Medicaid issues coming on. When the state is going to continue to grow with the from the 22%. Of Medicaid that we pay now to pick. Over the next number of years. They end that will be changed in the billions of dollars which we will have to do come up with a bad money or you're going to have to be certain programs that will not be covered. And so these conversations are very real at the state level there are many proposals I'm involved in the and welfare to work reform and workforce development getting people to war on welfare. Back to work giving them the job training pretty high priority occupations. That need. Need people to be applying in need these people would be employed. So there are areas where weekend. Begin to bring back the money in the revenue necessary. And there's a lot of people with a lot of good ideas out there and there's a lot of ways that we can generate this revenue and unfortunately. The conversation has not been there. What we can cut and where we can raise money and it it did make it happen come together. Iowa as some other people ask me you know like what are we doing with the casino revenue go. Where's that going to. I I had actually done well a lot of conversations on that actually when I do my property to our point actually include have money in there. I'm I'm actually pulling up that are talking here my computer because you know out of the end of the casino money we get 55%. Tax on the blocked by an avenue at 34% actually does the property tax relief fund. 12% go to the resource development fund which we talked about you Bork. 5% goes to the economic development toward him 4%. Goes to. Negotiated get those local share count that then apply the great programs that you see that come back into our area. The money as prominent Serbs especially under the grand gala years just saying this is going to eliminate your property and that's what we are anything that we heard that so often during those years. And it was a flat out lighted numbers are up by a factor and tax. So that's that's that's smoke and mirrors politics that was done under those years what is it. No. It was I. Whether it's flat out lying or give me trying to mislead people it would clearly not even quotes. Through a number is that that we're talking about and tell I got in though that what went well that taxpayers who are citizens of Pennsylvania were sold on. They you know they were lied and misled. Maybe we should tax the table games as well. They're the game dark actors. They they are actually got to try to capture your debt at 14%. Actually there at the conversation to grade them Gupta 16%. And I I think a proposal is moving towards them now as significant discussion. Obviously the space so the odds would it would play the table games are a little different so the cap and trade you a little different but. Absolutely the cable game I'm there was conversation that doing Internet gaming I'm not a candidate I voted against it but. It had the majority of the votes in the house said it was supposed to be voted on by the senate. My do you have concern that I do not support Internet gaming but if it's something that has been offered him proposed before. But. You know coming in trying to get but caught all this money and all this revenue to balance the budget. There are serious discussion on program sponsor red and milk and you know there's no doubt every factor still on the table you on where the discussions are. People in Pennsylvania believe that you know that severance tax sun on the natural gas industry should be a must. And I agree and I I think that it's something that needs to come forward. And the the impact speed and it's currently being paid work had to be an idea about 84 point 7% Everett factory. And you were a lot of people believe that that number should be in the five to five and a half percent range and we can probably garner another hundred million dollars yourself but this is not. A billion dollars that we're tied up that is not that type of money this isn't the end all be all fix the budget. Which I think a lot of people have talked about really tried to make at the issue this billion dollars. It can be about a hundred million dollars it doesn't get the budget it got to obviously helped. But it will not fix the budget but. Also at the same time that this conversation is happening there should be some level of regulatory reform in conjunction with that because. The Greek beat content bureaucratic regulation that keep on coming out of out of our department of environmental protection at. While I'm sure there well intentioned are not so different and better safety and protection of people. And they and I'm Cameron can't stand and we should consider doing new regulatory reform women as well. And and some things that maybe we should reduce the size of the legislative term or put you guys on part timers something. I actually I'm the big proponent of the part time idea I think that it is a direction where we can save a lot of money. I'm reducing the number of legislators. I and I voted for and I believe it should go on the ballot I do have some concerns. You know I voted for it out of the house and I don't bike and pulled port every time because I think people should have the ability to determine the way their government should be. I'll formed and created but. Well you reduce the number of legislators you make a districts larger and you make it now more important now raising money and being able to run a campaign as opposed to. You know being able to go out and not Indo on doors and meet people the way I got elected. And not be home this special interest to make it that much harder. The first somebody who is not beholden to special interest to get elected into represent a district because it becomes that much larger but. But I'd be you know it should be determined by the people will be on the ballot. We knew we need to save money in the legislature and tell I'm I'm a big proponent of moving to a part time legislature I think that's a great idea. And that's certainly a big proponent of that as well. And finally the governor feels as though that that some kind of budget deal was going to be put together the next couple of days. Did you have that feeling. Well we we did hear from art house majority leader saying that there have been conversations going sense sense when we voted him out. The house budget just recently. And I I believe the conversations are adults are ongoing I believe cooler heads will prevail I think we will get to a budget deal. And I think that will happen and I think that's part of that conference committee that I heard members of the senate actually. Speak in favor of I would support data as well. To get this in the conference so that. Then the leaders just how much better than the governor cannot negotiate wrap this thing up again so that we can move for gathering issues that are important to the commonwealth as well. They say representative baron cooperative venture joining us and taking time we're gonna do this so little bit more often if that's okay when you. Actually I look forward to a thank you open your very welcome have a good day you don't Iowa State representative Aaron cough hurt.