PA’s Counties Begin Work on 2016 Budgets Amid Uncertainty

Budget impasse now extends past 2009 mark

HARRISBURG – Today, the state’s budget impasse officially stretches beyond the historic 101 day mark reached in 2009, leaving counties struggling to manage the impacts of delayed payments and to prepare their own budgets for 2016.

County officials reiterated their dedication to the commonwealth’s residents and their families to assure they continue to receive critical services, including core human services, such as mental health and intellectual disability services, children and youth services and drug and alcohol programs, as they await word on progress that will lead to a final, responsible FY 2015-16 state budget.

“The budget impasse is having significant impacts on counties, with those impacts varying based on an individual county’s financial situation and the strategies used to sustain programs,” Craig Lehman, Lancaster County commissioner and 2015 County Commissioners Association of Pennsylvania (CCAP) president, said.

“Regardless, counties will continue to look for ways to provide services to abused or neglected children and to families struggling to handle the impacts of addiction or mental illness, and we will continue to support residents with intellectual disabilities.”

Compounding the impacts of the budget impasse is the county budget cycle, since county fiscal years operate from Jan. 1 to Dec. 31 (Philadelphia, merged city and county, operates July 1 to June 30).

Counties are required to begin preparing their budgets for the next county fiscal year at least 90 days prior to adoption, and with an adoption deadline of Dec. 31, counties began preparation of their budgets in September.

“Normally at this time of year, counties would receive allocation letters and submit state funding requests for next year. Instead, counties continue to wait for passage of a state budget. In its absence, counties lack important information on how to budget for many of their most important responsibilities,” Lehman noted.

State and federal funds account for an average of 40 to 60 percent of overall county general fund revenues. According to Bob Thomas, Franklin County commissioner and 2015 CCAP first vice president, “Counties have already deployed a variety of strategies to mitigate the impacts of the budget impasse, but as each week passes without a resolution the solutions become increasingly difficult.”

For instance, counties are:

  • Using county property tax revenues to support programs typically funded with state dollars
  • Stopping payments to providers until state funds are available for FY 2015-16
  • Planning for cuts or decreases in programs to help sustain cash flow
  • Considering adjustments such as reductions in staff pay, furloughs or layoffs
  • Freezing hiring, travel and non-critical purchases
  • Opening lines of credit or using tax and revenue anticipation notes to create a means of cash flow

“Counties will continue to serve as a capable and competent partner for the commonwealth in delivery of services to all Pennsylvanians,” Lehman said. “But each of these strategies comes with a cost and at some point, county taxpayers may be forced to shoulder that burden in the absence of a plan to address longer term impacts.”

Lehman said counties are calling for a viable commonwealth budget that recognizes the critical importance of the services provided to residents. According to Lehman, “We are seeking a prompt resolution, but it also must be adequate to meet program needs.”

In particular, counties emphasize that any initiatives that would complicate child welfare funding must be removed from consideration, as they would seriously endanger the ability of county child welfare agencies to meet their mandate for child safety.

Lehman said, “Given the increased case load impact of recently enacted changes in county obligations to protect children, funds in these lines should be off the table.”

At the same time, counties are calling for a three-year restoration of human services lines that saw an aggregate 10 percent cut in FY 2012-13.

Counties say that the General Assembly and the governor must take into account the local fiscal and administrative impacts of a protracted budget fight, the impacts of initiatives that further stress already limited resources and the impacts of any further reductions in critical state resources.

“The 2016 county budget planning process is being hamstrung by lack of a predictable level of state funding for programs and services,” Lehman said.

“But we recognize that adopting an annual county budget on time is our responsibility, and we are anxious for the legislature to quickly resolve the uncertainty posed by this ongoing impasse so that we may do so with reasonable and sound judgment.”

More information about the impacts of the budget impasse on counties, as well as CCAP’s complete catalog of county impasse strategies, is available at www.pacounties.org by clicking on “Budget News and Updates,” then “FY 2015-16 Budget Impasse,” or by calling 717-526-1010.

CCAP is the voice of county government, a statewide, non-profit, non-partisan Association representing all of Pennsylvania’s 67 counties. CCAP membership includes the county commissioners, council members, county executives, administrators, chief clerks and solicitors.

CCAP strengthens the counties’ abilities to govern their own affairs and to improve the well-being and quality of life for every Pennsylvania resident. It advocates for favorable state and federal legislation, programs and policies on behalf of counties. CCAP is committed to service excellence through education, information, insurance, technology and other programs that support effective county government.

Founded in 1886, CCAP is an affiliate of the National Association of Counties

For more information about Pennsylvania’s counties and CCAP, log on to www.pacounties.org.

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