Third and State

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Voters like Gov. Wolf’s Budget Plan

June 18, 2015 - 2:50pm

The latest poll from Franklin and Marshall’s Center for Opinion Research shows that a solid majority of voters – 58 percent – support Gov. Wolf’s budget plan to increase the sales and state income taxes and tax gas drilling to increase education funding, reduce property taxes, and plug the state’s structural deficit. Voters’ top issue is increasing public education funding, while only 10 percent cite passing a state pension plan as a priority, and a paltry 2 percent think privatizing the state liquor store system is a high priority.


Voters say that what they like best about the governor’s budget is the tax on gas drilling. More education funding and property tax relief round out the top three reasons they like the plan.

The difference between voters’ top priorities and those of Republican leaders in the legislature   – pension reform and liquor privatization – is striking. It will be interesting to see whose priorities prevail in budget negotiations.

Bursting the Shale Jobs' Balloon

June 17, 2015 - 3:46pm

The Pennsylvania Department of Labor and Industry has corrected “glaring errors” in the way it counts jobs related to gas drilling and drastically revised downward the number by 160,000 jobs. Instead of the 200,000 to 339,000 jobs the industry claims it has created, Labor and Industry now counts around 90,000 gas drilling jobs in Pennsylvania, with 30,000 of those in core drilling industries.

This is not news to us. Our research repeatedly has shown that the industry’s exaggerated job claims could not be supported. As we’ve found, the industry’s jobs’ balloon was filled with workers who have nothing to do with gas drilling. For example, Labor and Industry’ inflated numbers included every road construction worker, truck driver and steelworker in the state, even if those jobs had nothing to do with gas drilling. Drilling jobs, in fact, make up less than one percent of all Pennsylvania jobs.

A look at county unemployment rates also reveals that gas drilling is not the super-charged jobs engine the industry claims it is. Generally, counties without any drilling had lower unemployment rates in March than counties with substantial drilling activity. Tioga County’s unemployment rate was above 6 percent while Perry County’s stood at 4.5 percent.


The gas industry is supporting a substantial number of jobs. But with major policy questions on the table -- like whether to enact a severance tax on gas extraction -- decision-makers need real numbers, not an inflated industry jobs’ balloon. There never were 200,000 shale jobs in Pennsylvania.

Report Ranks Pa. 23rd Among States, Gives It C+ Grade, for Status of Women

June 15, 2015 - 6:20pm

A new report by the Institute for Women’s Policy Research ranked the 50 states and the District of Columbia based on the status of women in six different categories: poverty and opportunity, work and family, violence and safety, reproductive rights, health and well-being, and political participation.  Minnesota, Connecticut, Massachusetts, and Vermont scored highest overall.   Pennsylvania received an overall ranking of 23 in the nation and an overall C+ grade.  The commonwealth fared poorly on several measures of the status of women: Work & family and political participation were the two worst categories.  

Some key findings:

  • Pennsylvania women only earn, on average, 76 cents for every dollar a man earns, which is the 11th worst gender wage gap in the nation.  At the current rate, they will not receive equal pay until the year 2072. 
  • 32.1% of employed Pennsylvania women work in low-wage jobs, and few (27%) own businesses compared to men (56.3%). 
  • Almost half of women living in the commonwealth -- 47% -- do not live in a county with an abortion provider. 
  • Pennsylvania ranked 48th for number of women serving in elected office, better only than Georgia and Louisiana.     

However, Pennsylvania ranked highly on a few measures of women’s status. 

  • The state ranked 9th best on the Paid Leave Legislation Index and 11th best on the Women Institutional Resources Index. 
  • Fewer women in Pennsylvania live below the poverty level than in all but 14 states, with 86.5% of women and 89.3% of men living above the poverty level. 
  • Pennsylvania ranked 9th best in healthcare coverage.  The vast majority of residents, 88% of women and 83.7% of men, have health insurance.        


KRC/PBPC's Insider News for Week Ending June 12, 2015

June 15, 2015 - 5:57pm

The Pennsylvania Budget and Policy Center said another bittersweet good-bye this week, to long-time research director Mike Wood. We will miss Mike’s unflappable demeanor, formidable work output and sly wit. But we are proud to make another excellent contribution to the new administration. Mike joins former PBPC director Sharon Wood in the Governor’s Budget Office. His new title is Executive Budget Manager – Division of Education (we’re saluting as we write that). Congratulations and best of luck, Mike!

PBPC Research Director Mike Wood on Budget Night 2015

PBPC is advertising for a new director, and budget and tax analyst. Read the announcements (and apply or forward to someone you know who should) here.

Just the fact sheets, ma’am … PBPC released a valuable new tool this week that shows how Gov. Wolf’s budget proposal would impact each legislative district. Easy-to-read, one-page fact sheets reveal the property tax relief for homeowners, increased funding for local schools, additional preschool slots created, number of local workers who would benefit by a minimum wage increase and other important information for each district. These fact sheets provide local numbers not found anywhere else. See how your legislative district would fare here.

Testifying on tax proposals … Keystone Research Center Executive Director Steve Herzenberg testified before a Senate Finance Committee public hearing on Wednesday on proposals to increase Pennsylvania’s personal income and sales taxes. Steve told the committee, “together with his severance tax proposal, the Governor’s sales and income tax proposals would provide revenue to reinvest in education, in communities, and in job creation. These investments would reverse the cuts and austerity within the 2011‐12 budget, which contributed to the layoff of 27,000 public school employees and help explain the states low‐job growth ranking. The Governor’s proposal would also solve the state’s structural budget deficit, not only this year but going forward, reassuring bond rating agencies”. You can read Steve’s full testimony here.

Signing on to raise the wage … KRC labor economist Mark Price and KRC/PBPC summer interns Anna Berch-Norton, Ellis Wazeter and Patrice McKenzie joined other members of the Raise the Wage PA coalition in the Capitol on Monday to submit more than 10,000 petition signatures calling on the state legislature to raise Pennsylvania’s minimum wage to at least $10.10 per hour. 

Gov. Wolf accepts minimum wage petition signatures

For more on why the minimum wage should be raised, check out Franklin and Marshall Economics Professor Sean Flaherty’s op-ed today on

Soaring production and sliding impact fees … As if we needed further proof that it’s time for Pennsylvania to join every other major gas-producing state and enact a severance tax, PBPC consultant Jan Jarrett blogged this week on Third and State about how gas drillers last year exceeded their production record from the year before by 30 percent, yet their impact fee payments dropped slightly.  “That drop proves that the impact fee does not generate increasing revenues for Pennsylvania as the drilling industry’s production and profits climb. “A severance tax on production, like the one proposed by Gov. Wolf, would generate increasing revenue as production increases and gas prices rise,” Jan writes.

You can read more about the severance-tax-versus-impact-fee debate in a June 10th WESA 90.5 story that quotes PBPC’s Mike Wood on the gas industry’s many excuses over the years.

Smokin’ mad about cigarette tax loophole in Allentown … Mike was also quoted in a June 6th Morning Call story about a lucrative loophole in Allentown’s one-of-a-kind Neighborhood Improvement Zone that allows developers to use taxes on cigarettes stamped in the zone, but sold across the state, in addition to other state and local tax dollars, to help finance their projects in the city.

Mike called it “a legal shell game providing a cash machine for developers.”

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Artist’s rendering of proposed Waterfront riverside district that could be developed with help of cigarette tax
                                                                                         from The Morning Call

Exceeding estimates but lowering expectations … And in his last revenue report for PBPC Mike notes that while General Fund revenues exceeded estimate once again in May that’s likely to be of little help to the 2015-16 budget. Read his blog post on Third and State to find out why.