Much Ado About Not Much

The General Assembly has left Harrisburg, two days after Governor Wolf allowed a General Fund budget bill to become law without his signature. While there is apparent agreement on how much money will be allocated for state programs over the next year, there is no consensus on how to pay for it, or how it will be administered. The uncertain situation is now an untenable one.

Here’s where we stand as of today:


1. The Numbers are Bad for the Environment, Again

While the cuts were less drastic than in prior years, the Department of Environmental Projection (DEP) still had its General Fund allocation reduced in the General Fund budget bill. This is against the backdrop of more than a decade of continuous cuts, coupled with the threat of a significant reduction of federal funding in the years ahead.

DEP’s current funding levels are lower than they were two decades ago. The agency has lost a quarter of its staff since 2003. While DEP has begun the long-overdue process of increasing permit fees to address shortfalls, but even in the most optimistic of scenarios, these new monies will not be in place until 2019 or later.

That means Pennsylvania remains far behind other states in performance of even the most fundamental of activities. For example, our state’s Safe Drinking Water Program currently has an inspection workload more than twice the national average, and has come under fire from the Environmental Protection Agency as woefully inadequate.

It has become clear that DEP has been cut to beyond its ability to meet its core mission. When you factor in the numerous “billion dollar problems” facing the Commonwealth that go above and beyond operational resources – like cleanup of the Susquehanna River or the state’s abandoned mine lands and gas wells – the picture becomes all the more bleak.

Despite all this, there have been a number of legislative hearings over the past few months on DEP’s competency, particularly with respect to permitting turnaround. Lost in those discussions was the direct nexus of prolonged budget cuts and agency capacity. This isn’t to make light of a legitimate problem – there is no question that agency accountability is critical. The regulated community deserves the same level of consistency and responsiveness in permitting that the public deserves in oversight and enforcement, and clearly some problems go beyond simply a lack of money. But without sufficient fiscal support, we can expect nothing better than the continuation of a status quo with which no one is happy.

The bottom line is that DEP is no longer equipped to perform its mission, or meet its obligations to the citizens, communities, and businesses of Pennsylvania. The spending framework agreed to by the Governor and General Assembly ensures that the agency remains underfunded and understaffed for another year.

The budget news is slightly better for the Department of Conservation and Natural Resources (DCNR), as they received a slight increase in their overall budget compared to the prior year. The primary difference being an increase in operational funding from Oil and Gas Lease Fund revenues. That Fund, created decades ago to direct revenues generated from resource extraction on state lands toward maintenance and improvement of those lands, has been increasingly repurposed by the General Assembly to cover other operating needs of the agency.


2. What Riders Will Accompany the Budget this Year?

It is become standard practice for the General Assembly to use legislation necessary for implementing the state budget, including the Fiscal Code and Administrative Code, as vehicles for passage of other legislative provisions unrelated to spending or revenue. There are serious questions as to whether this practice is constitutionally valid, let alone representative of good public policy. Often environmental protections are the target, and this year appears to be no different.

The current expected legislative vehicle for the state Administrative Code bill – Senate Bill 446 – includes several provisions that weaken environmental protection criteria. One allows for continuation of expired and deficient permits for wastewater treatment from the conventional oil and gas industry; another reduces water quality criteria for manganese.

As in the past, PEC has opposed the inclusion of novel or substantive environmental provisions in the state budget.

We have yet to see what provisions may be included in Fiscal Code legislation.


3. Will Environmental Program Funding be Redirected?

In past budget years, the Governor and General Assembly have authorized the redirection of revenues from dedicated environmental funds – such as the Environmental Stewardship Fund (aka Growing Greener) or the Keystone Recreation, Park and Conservation Fund – to help balance the state general fund. This reallocation has hampered both agency and private initiatives to improve and expand community recreational amenities, protect local and agricultural lands, and improve water quality throughout the state.

A recent state supreme court decision has underscored the responsibility of state and local government to protect our natural resources, including its use of state funds. This decision now plays a strong factor in what decisions are made with respect to the state budget in an era of revenue deficits.


PEC will continue to monitor and engage on the state budget. Please follow us at @pecpa and @pecpolicy on Twitter, as well as the Policy section of our website.