The state is on-track to complete its current fiscal year with a surplus. But it’s the coming budget year Governor Corbett’s budget secretary is worried about.
Set aside, for a moment, the fact that the commonwealth has no clue what will happen with the so-called fiscal cliff. Budget Secretary Charles Zogby said at his mid-year budget briefing that he’s still expecting to get less federal funding.
State agencies have been told any lost federal dollars won’t be replaced with money from the commonwealth’s coffers. As a result, Zogby said, the 2013-2014 budget will likely bring layoffs for state workers.
“Collapsing vacancy funding, potentially furloughs and layoffs may be the outcome in some areas of this spending restraint and cost-cutting efforts,” said Zogby.
Agencies are being asked to maintain level funding in the next budget cycle, but they’ll actually have to reduce expenses to make up for rising medical and pension costs.
There’s another x-factor: the Corbett administration’s prediction of revenue growth for the coming year is nearly triple the estimate of the state’s Independent Fiscal Office. If the IFO’s estimate is closer to reality, the state will have even less money than it predicted going into the next fiscal year.
Zogby said he thinks the past two years of cuts and cost-savings in education and public welfare probably can’t be replicated in the coming budget year, though he said much could happen between now and the governor’s budget address in early February.
“We’re working very hard in a number of areas – education would be one, health and human services – to not have to make the level of deep cuts that we’ve made in the past,” said Zogby.
