Pennsylvania Senate Republicans
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Senate Appropriations Committee
Budget Hearings
FY 2013-2014


During a budget hearing with Secretary of Aging Brian Duke, members of the Senate Appropriations Committee discussed the effects of the Attorney General’s rejection of the governor’s plan to privatize management of the Pennsylvania Lottery. 

Other topics of discussion included:

  • The funding formula for Area Agencies on Aging.
  • Waiting lists for home and community-based services.
  • A requested increase in Department staff.
  • Measures in place to prevent elder abuse.


Members of the Senate Appropriations Committee questioned Secretary of Agriculture George Greig about proposed cuts and potential funding options for county Conservation Districts.

Other topics of discussion included:

  • The financial impact of the elimination of the inheritance tax on family farms.
  • Proposed funding for the Animal Health and Diagnostic Commission.
  • The administration’s commitment to the Race Horse Development Fund.
  • Monitoring and potential action to prevent chronic wasting disease in animals.
  • Federal dollars and state support available for the State Food Purchase Program.
  • The financial strain of federal Chesapeake Bay pollution standards.
  • New agriculture transportation measures.

Attorney General

Attorney General Kathleen Kane came before the Senate Appropriations to answer questions on a wide range of issues, including how her office can continue to effectively fight crime with its current budget and the reasoning behind her decision to block a proposal to privatize management of the Pennsylvania Lottery.

Senators also wanted more information on:

  • Efforts to get child predators off the streets and behind bars.
  • The reduction in funding for the Bureau of Consumer Protection.
  • The cost of witness relocation, particularly in the Philadelphia area, where the crime rate is high.
  • Enforcement of a new program to crack down on home improvement fraud and assurance that contractors are registering with the state.
  • Office funding cuts of 17 percent over the past five years and its impact on the state's ability to fight crime.
  • The growing threat of drug cartels and gangs, and increased drug use, particularly among young people.

Auditor General

Auditor General Eugene DePasquale outlined his office's request for an 8.6 percent budget increase to pay for staff, operating expenses and new technology. Committee members discussed:

The technology shortcomings in the office.

  • Performance audits and follow-ups to audits.
  • Municipal pension audits.
  • Increases in the number of performance audits leading to a backlog of financial audits.
  • Auditor General oversight of judicial and legislative accounts.
  • Details on the office's outside contracts.
  • Data storage system sharing.
  • Charter school audits frequency and rigorousness.
  • Board of claims backlog.
  • School Safety audits.

Community & Economic Development

During a public hearing on the proposed budget for the Department of Community and Economic Development (DCED), senators discussed efforts to reduce business taxes, promote job creation and encourage companies to stay in and relocate to Pennsylvania.  Other questions centered on: 

  • The governor's business tax reform package and how it would impact job creation.
  • The status of the Royal Dutch Shell coal cracker plant deadline extension.
  • The governor's PA Business Development Authority proposal.
  • The continuation of low-interest loans to businesses.
  • Highlights of the "Discovered and Developed in PA" program.
  • The importance of the "Innovate PA" initiative.
  • A proposal to move port oversight from DCED to PennDOT, and the dredging of the Delaware River.

Conservation & Natural Resources

Members of the Senate Appropriations Committee questioned DCNR Secretary Richard Allan regarding Marcellus Shale drilling on state-owned lands.

Other topics of discussion included:

  • State support for the Keystone Fund.
  • Infrastructure and maintenance needs in state parks and forests, including dirt and gravel roads.
  • Potential increases in user fees.
  • Rental of existing structures to be used as cell towers.
  • Possible conversion of the DCNR fleet to natural gas.
  • Funding for the Pennsylvania Heritage Areas Program.

Corrections & Probation & Parole

Corrections Secretary John Wetzel discussed the $23 million in cost savings to the state resulting from the closure of State Correctional Institution Cresson and State Correctional Institution Greensburg and the opening of State Correctional Institution Benner. Other issues discussed at the hearing included: 

  • Projected decreases in the prison population and potential prison closures.
  • Prison construction projects.
  • Efforts to reduce recidivism.
  • The pay differential between correctional officers and supervisors.
  • Efforts to contain energy costs.
  • Concerns raised by the killing of Corrections Officer Eric Williams on February 25 at Canaan Federal Penitentiary.
  • Gang activity in prisons.
  • Expungement of criminal records.
  • Health issues related to prisoners.
  • Computer use by inmates.
  • Abuses of the Right to Know Law by inmates.
  • Privatization initiatives.
  • County inmates collecting unemployment compensation.
  • Education programs in prisons.

Drug & Alcohol Programs

Members of the Senate Appropriations Committee discussed measures to combat prescription drug abuse and the potential effects of marijuana legalization during a budget hearing with Secretary of Drug and Alcohol Programs Gary Tennis.

Other areas of discussion included:

  • The need for a cabinet-level agency separate from the Department of Health.
  • Trends in alcohol abuse among high school and college students.
  • Improving the cost efficiency of service delivery.
  • Addiction treatment costs for individuals who are released from prison.
  • Methadone treatment costs.


State Education Secretary Ronald Tomalis was questioned about K-12 funding in the proposed state budget. The secretary said state Basic Education funding is at its highest in state history, despite a 10-year drop in overall student enrollment. Other topics discussed included:

  • Charter school funding reform.
  • Funding and accountability changes.
  • Moratorium on PlanCON school construction reimbursement.
  • Transparency in Intermediate Unit contracts with the state.
  • Highest state funding for K-12 education in history.
  • Recommendations for adequate administrator-student ratios in districts.
  • Liquor privatization money for schools.
  • Natural gas drilling taught as career pathway in schools.
  • Science in Motion funding eliminated.
  • Special education funding reform.
  • Governor's School for the Sciences.
  • PA score in NAEP - Nation's Report Card.
  • School safety assessment backlog.
  • School property taxes.
  • "Hold Harmless" clause hurting school districts.
  • Effect of student aid on increasing higher ed costs.
  • Reason for growth of charter schools.
  • Penn State Board of Trustees size.

Environmental Protection

Secretary Michael Krancer was questioned about funding for gas well inspectors and increased inspections, as well as the status of efforts aimed at reducing the DEP permit processing backlog. Other topics included:

  • Susquehanna River water quality improvements.
  • Effect of pharmaceuticals in waterways.
  • Proposed regulations on septic system runoff.
  • The quality of air coming in from surrounding states.
  • New electronics recycling law enforcement mechanism.
  • Summer gas and State Implementation Plan review.
  • Scrap tire piles cleanup efforts.
  • Status of brownfields projects.
  • Future of hazardous sites cleanup in light of funding tied the Corporate Stock and Franchise Tax, which is being phased out.
  • Stormwater management regulations.
  • Increase in PENNVEST funding.
  • Mandatory curbside recycling program.

Gaming Control Board

Pennsylvania's gaming industry is strong and continues to grow, according to Pennsylvania Gaming Board Bill Ryan. He told members of the Senate Appropriations Committee that Pennsylvania is now the nation's second-largest gambling market. Senators asked Ryan about:

  • Criminal activity at casinos and the use of State Police at gaming facilities.
  • Concerns about the impact of Internet gaming on casinos.
  • The definition of Keno in casinos and in the governor's private lottery contract.
  • Competition from surrounding states and the need to keep the casino industry strong in Pennsylvania.

General Services

Members of the Senate Appropriations Committee questioned DGS Secretary Sheri Phillips regarding the department's efforts to support veteran-owned small businesses and streamline the process for selling surplus state property.

Other topics of discussion included:

  • The number of outside contracts and consultants utilized by DGS.
  • The projected reduction in utility costs and energy use.
  • Reducing the state vehicle fleet and associated costs.
  • The potential use of natural gas vehicles.
  • Heating costs at state correctional institutions.
  • The potential budgetary impact of mineral resource development on state land.

Governor's Office/Governor's Budget Office/Executive Offices

The Senate Appropriations Committee opened its series of hearings on Governor Corbett's proposed 2013-14 budget with a discussion of the Governor's Budget Office/Executive Offices/Office of the Governor with Budget Secretary Charles Zogby.

Issues discussed included:

  • Closure of the New Castle Youth Development Center.
  • The governor's decision against expanding Medicaid under Obamacare.
  • Revenue projections.
  • Funding for state police cadet classes.
  • Trends in gaming revenue.
  • Reduction of state jobs in the budget.
  • The governor's public pension reform proposal.
  • Consolidation of state data centers and technology upgrades.
  • Investigations of welfare/food stamp fraud.
  • Implications to the budget if privatization of the lottery management and liquor sales does not occur.
  • Employment opportunities for veterans.
  • Education funding.
  • Changes to the state Racehorse Development Fund.
  • Spending for private sector consulting services.


During a public hearing on the Department of Health's budget, senators discussed how the state can more effectively and affordably provide health care to Pennsylvania residents, particularly senior citizens and those in rural areas.   Senators also raised questions about:

  • Revenues in the Tobacco Settlement Fund.
  • The growing shortage of primary care physicians.
  • The role of community health centers in providing care to those who may not have insurance.
  • Providing health care to help seniors stay in their homes.
  • Education outreach programs.
  • Working to get doctors into rural communities where the need is great.
  • Increased funding to fight Alzheimer's.

Independent Fiscal Office

The committee discussed several issues with Independent Fiscal Office (IFO) Director Matthew Knittel, including:

  • The differences between the governor's revenue projections and those of the IFO.
  • The impact of federal tax increases on Pennsylvania.
  • The use of EITC.
  • Tax law enforcement.
  • Changes in the housing market.
  • The IFO's review of the costs of Medicaid expansion under Obamacare and the impact of Obamacare on businesses.
  • State unemployment rate projections.


Insurance Commissioner Michael Consedine discussed several issues related to Obamacare, including Medicaid expansion and the federal health exchange. Other topics included:

  • CHIP enrollment
  • MCARE phase-out
  • Fraud investigations
  • The economy's impact on insurance companies.
  • Competition in the marketplace.

Labor & Industry

During a budget hearing with Labor and Industry Secretary Julia Hearthway, members of the Senate Appropriations Committee praised the bond issuance to resolve debt in the Unemployment Compensation (UC) Trust Fund.

Other topics of discussion included:

  • The effect of federal sequestration on programs and services.
  • Closure of the Philadelphia UC call center.
  • The impact of the Industry Partnerships program.
  • Changes to EBT debit cards.
  • The future of the Self-Employment Assistance Program.
  • Coverage for volunteer firefighters through the State Workers’ Insurance Fund.
  • UC fraud by inmates in state and county prisons.
  • The impact of the work search requirement to receive UC benefits.
  • Possible expansion of the successful Strategic Early Warning Network program.
  • Potential measures to reduce Workers’ Compensation fraud.

Liquor Control Board

Members of the Senate Appropriations Committee gathered information about the governor's plan to privatize the sale of wine and liquor during a budget hearing with PLCB Chairman Joseph Brion. Other topics of discussion included: 

  • Beer sales in cafés adjacent to supermarkets.
  • Direct wine shipments to consumers.
  • Profitability and accessibility of current outlets.
  • State liquor store modernization proposals.

Military & Veterans Affairs

The Senate Appropriations Committee held a budget hearing on the Department of Military and Veterans Affairs with state Adjutant General (Major General) Wesley Craig. Issues discussed included the impact of sequestration on Fort Indiantown Gap.  Other topics included:

  • Veterans Trust Fund activities.
  • State veterans’ homes.
  • Status of Air National Guard units, including the 911th.
  • Legislation lifting civil service requirements for hiring nurses at veterans’ homes.
  • The suicide rate in the National Guard.
  • Use of the Willow Grove Naval Air Station.
  • Disaster response efforts.
  • Support programs for military families.
  • Retention and recruiting of Guard personnel.
  • Waiting lists for veterans’ homes.

Public Utility Commission

Public Utility Commission Chairman Robert Powelson and commissioners discussed the PUC's $64.2 million state funding request and the commission's increased responsibilities with natural gas development and other areas. Among the issues discussed was the commission's request to raise the PUC's budget cap to deal with the increased workload.

Other topics discussed included: 

  • Hurricane Sandy utility response.
  • Power outage grid indicators for municipalities.
  • Status of Distribution Improvement Service Charge (DSIC) projects and ratepayer protections.
  • Marcellus Shale impact fee revenue distribution.
  • Increasing access to natural gas.
  • Pipeline safety for unregulated gas lines.
  • Verizon's request for relief of Chapter 30 broadband requirements.

Public Welfare

Acting Secretary of Public Welfare Bev Mackereth fielded questions from the Senate Appropriations Committee regarding the cost and impacts of the potential expansion of Medicaid.

Other topics included:

  • Collection of delinquent nursing home assessments.
  • Problems resulting from the privatization of payroll services for direct care workers.
  • The growth rate in Medical Assistance.
  • How to improve county assistance.
  • Progress of a pilot program that requires public benefit recipients to pass a drug test.
  • The reduction in waiting lists for services.
  • Management and construction of nursing homes.
  • How additional funds for the Rising STARS program would be allocated.
  • Ways to improve DPW communication with state residents.
  • The effectiveness of block grants for human services funding.
  • A change in the funding formula for the Pennsylvania Coalition Against Rape.
  • Services available to veterans.


State Revenue Secretary Dan Meuser discussed various aspects of the proposed private management agreement with Camelot for the Pennsylvania Lottery. Other topics discussed during the hearing included:

  • The projected impact of sequestration – if it occurs -- on state revenues.
  • The governor's proposals to reduce business taxes to promote economic development.
  • The Property Tax/Rent Rebate program.
  • The tax liability for Marcellus Shale royalties.
  • Sales tax collections from online transactions.
  • Small games of chance reporting requirements for non-profit organizations.
  • The costs of Medicaid expansion under Obamacare.
  • Revenue projections through the remainder of the fiscal year.


The committee discussed the impact of pension obligations on the state budget with officials from the State Employees' Retirement System and the Public School Employees' Retirement System.  Topics included:

  • Current returns and historic data of the pension funds.
  • The impact of Act 120 of 2010.
  • The possibility of changing future benefits to current employees.
  • Compensation for fund executives and consultants.
  • The long-term effect of moving from defined benefits to defined contribution plans.
  • Salary growth assumptions and fund projections.
  • Percentage of alternative investments and returns.
  • Pennsylvania-based investments.
  • The effect of inflation on the funds.
  • Pension plan investment in public construction projects.


Senators raised a number of questions about the state's voter identification law during a hearing on the proposed budget for the Department of State.  Other issues that were addressed included:

  • The amount of money that could be saved by filing campaign reports on line.
  • The process for auditing campaign finance reports.
  • Ensuring that polling places are accessible to all voters.
  • Legislation providing for online voter registration.

State Police/Homeland Security

State Police Commissioner Frank Noonan discussed school safety issues and Pennsylvania’s homeland security efforts. Other issues discussed included:

  • The ongoing implementation of the statewide radio system.
  • The impact of pension reform on the state police.
  • Cadet training classes and the state police complement.
  • State police coverage of areas without local police departments.
  • Efforts to prevent cybercrime.
  • NA testing capacities and backlog.
  • Trooper presence in casinos.
  • Background checks for gun purchases.

State System of Higher Education

Acting Chancellor of the Pennsylvania State System of Higher Education Peter Garland, and the presidents of Edinboro and Lock Haven universities, were questioned by the committee on efforts to keep down costs and tuition, and implementation of the 2012 Higher System of Education Modernization Act. Other topics included:

  • The burden of increased charges and fees rising on students.
  • PASSHE administrative size and makeup.
  • Growth in PASSHE administration under Act 88 limitations.
  • New faculty contract.
  • Private fundraising in lieu of budget increase.
  • Transfer of community college credits to PASSHE schools.
  • Deferred maintenance and capital projects.
  • PASSHE and the Center for Rural Pennsylvania.
  • System nursing school opportunities.
  • Accessibility for students with disabilities.
  • Tuition for non-citizen students.
  • Performance funding system.
  • State Police threat assessment review of buildings.
  • Effects of flat and reduced PASSHE funding.
  • Making system schools more entrepreneurial.

State-Related Universities

Members of the Senate Appropriations Committee asked about the efforts by Penn State University, University of Pittsburgh, Temple University and Lincoln University to keep costs and tuition rates down. Other subjects included: 

  • The impact that the state appropriation to the schools has on their tuition levels.
  • Transparency and accountability of university boards.
  • Increasing student debt and how it is impacting enrollment levels.
  • The growing trend toward online education.
  • The universities' efforts to help students graduate on time.
  • The role played by the universities in supporting agriculture research and outreach.


Transportation Secretary Barry Schoch faced extensive questions on the administration's plan to boost transportation funding by $1.8 billion. Topics included:

  • Problems caused by the current funding shortfall.
  • Effect on consumers of lifting the Oil Company Franchise Tax.
  • Projects to be funded by new funding.
  • Public-Private Partnership (P3) transportation projects being developed.
  • Port authorities and mass transit funding.
  • Mass transit consolidation.
  • Registration and license fees.
  • Funding package effect on county-owned bridges.
  • Gravel and dirt roads funding.
  • Increased local match for mass transit. 
  • Local turn-back program for bridges.
  • Declining Liquid Fuels Tax revenue.
  • Plans to reduce highway congestion.
  • Bundling bridge construction projects.
  • Mass transit for riders with disabilities.
  • Cost to average family under transportation plan.
  • Port authorities and bridge funding.
  • Alternative rail funding.
  • Increased payments to municipalities. 
  • Financial outlook of the Pennsylvania Turnpike.

Treasury Department

Members of the Senate Appropriations Committee questioned Treasury Secretary Rob McCord on the department's request for a 24.5 percent increase in funding and the costs driving that hike.

Other questions centered on:

  • A proposal to privatize the Pennsylvania Lottery.
  • Pension costs for teachers and state workers and their impact on the budget.
  • Growing concern about the rising debt of the Pennsylvania Turnpike.
  • Reforms being implemented at the Delaware River Port Authority
  • The status of an ongoing IT modernization project that is intended to improve efficiencies.
  • Finding ways to make college education more affordable for students and families.
  • The use and cost of outside contractors.

Senate Republicans Discuss Gov. Corbett's Budget Address
Watch | Listen - Senate President Pro Tempore Joe Scarnati (R-25)
Watch | Listen - Sen. David Argall (R-29)
Watch | Listen - Sen. Mike Brubaker (R-36)
Watch | Listen - Sen. Scott Hutchinson (R-21)
Watch | Listen - Sen. Bob Mensch (R-24)
Watch | Listen - Sen. John Rafferty (R-44)
Watch | Listen - Sen. Pat Vance (R-31)
Watch | Listen - Sen. Elder Vogel (R-47)
Watch | Listen - Sen. Don White (R-41)


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