Pennsylvania Secretary of Policy and Planning, John Hanger, was in Centre County recently to talk about Gov. Tom Wolf’s budget and how it will impact the region.
His appearance came during a breakfast held by the Chamber of Business and Industry of Centre County.
Wolf recently released his proposed budget for the Commonwealth. One of the first items that Hanger touched on was the change in direction from the previous administration.
“The governor has proposed a bold budget plan,” Hanger said. “I think the question is: ‘Why now? Why a bold budget plan?’ I believe the answer to that question is because Pennsylvania has underperformed as a state for 30 to 40 years, a good long period of time. We could be doing so much better.”
According to Hanger, the governor devised the budget with several goals in mind.
First, Hanger talked about Wolf proposing major business tax reforms. Those are highlighted by a cut in the corporate profits tax rate from 9.99 percent to 5.99 percent, Hanger said.
“We’ll go from, essentially, being uncompetitive and punishing businesses to being very competitive and attractive to businesses,” Hanger said.
Wolf plans to close some loopholes that he says allow some businesses to escape paying the tax, and is proposing $675 million in new bond-funded infrastructure, energy and technology investment programs designed to assist business expansions and relocations and help more end users take advantage of the natural gas produced in Pennsylvania.
Hanger said that Wolf also wants to tackle property taxes as well.
“Property tax has become another ball and chain around the state as a whole — many, many communities and school districts are affected. The governor is proposing a substantial amount of property tax relief,” Hanger said.
Property tax relief would impact Centre County schools significantly. For example, it would provide the Bald Eagle Area School District with an allocation of $4.8 million. The property tax relief rates are staggering, Hanger said.
Bald Eagle Area would see the greatest impact — 93 percent. Elsewhere in Centre County, Philipsburg-Osceola (80 percent), Penns Valley (46 percent), Bellefonte (43 percent) and State College (16 percent) would also benefit greatly from property tax relief.
“The governor feels strongly about that because it’s been his experience in business and as a community leader that in so many school districts and so many parts of Pennsylvania, the property tax has made whole areas of the state uncompetitive for investment. Millage rates are so high that they are driving out investments or keeping investments from coming in,” Hanger explained. “It would turn those communities from a ‘no go’ to ‘we’re open for business.’”
More importantly, Hanger said, property tax relief will benefit homeowners.
“It will undoubtedly increase property values across the state. This plan will increase the wealth of Pennsylvanians because it’s going to raise home values. It’s a very important part of his plan,” Hanger noted.
Education is key in the Wolf budget. In his spending plan for 2015-16, he wants to dramatically increase money for education by $2 billion over four years, across the board. Bald Eagle Area School District, which saw $725,000 cut over the past four years, would get a $484,606 increase in just one year.
The budget will not only impact local districts, but secondary education as well, Hanger said.
“The governor is an unapologetic supporter of education from early childhood, all the way through (kindergarten) through 12 and higher ed. That’s not just talk from this governor. The governor has proposed a huge investment in education,” Hanger said.
That will have an impact on Penn State. Wolf is proposing to, over the next two years, restore the money that was cut from higher education under his predecessor. This year, that means $1.765 billion, a 9.9 percent increase, for higher education, with increases in funding for Penn State, the State System of Higher Education, community colleges and more.
“In the case of Penn State University, it restores $49.6 million,” Hanger said. “It will obviously be very helpful and important to Centre County, the institution and all the families and businesses that benefit from Penn State.”
