POTTSTOWN >> Members of the TriCounty Area Chamber of Commerce had an opportunity Thursday to hear from several area lawmakers during the chamber’s annual legislative breakfast.
The breakfast gives chamber members a chance to hear about issues facing the region, and to ask questions.
“We are an advocacy organization by definition. We want our membership to understand the issues that have an impact on them,” said Eileen Dautrich, president of the TriCounty Area Chamber of Commerce. “We want to provide them with access so they can ask questions and get information.”
On the agenda for the meeting, which was attended by about 80 chamber members, were state Sen. Bob Mensch (R-24th Dist.) and state Reps. Marcy Toepel (R-147th Dist.), Tim Hennessey (R-26th Dist.) and Tom Quigley (R-146th Dist.).
Mensch started the conversation by saying that Pennsylvania has a cash flow problem, adding that this year’s budget process “is the greatest wake-up call to the state of Pennsylvania that I have seen.”
After a four month budget stalemate, Gov. Tom Wolf on Monday signed a borrowing pan and casino expansion designed to balance the state’s $32 billion general fund budget.
“We are literally out of money. We are growing our expenses at a rate much greater than or revenues. Some people would say that’s a revenue problem, others would say that’s a spending problem. It’s much more fundamental than that — it’s a cash flow problem,” Mensch said. “The economy of Pennsylvania is suffering — we’re not growing at the pace of the rest of the nation.”
He pointed out that Pennsylvania is still recovering from the loss of manufacturing, and lags behind other states that have been able to bring in new jobs. That has resulted in a tax structure for businesses that is no longer competitive.
“We have the worst tax structure for businesses in the united states. If we were a country we would have the worst tax structure in the world,” he said, adding that the legislature needs to think about ways to entice new businesses to come to Pennsylvania.
“New businesses mean new jobs, new jobs mean new money into the economy and new money into the economy means that the state budget begins to fare better,” he said.
In response to a question about what can be done, Mensch said that in the 1950s, Pennsylvania had the fifth largest economy.
“It took us 70 years to get here; it’s going to take us a little while to get back. It won’t happen overnight,” he said.
Toepel added to Mensch’s comments on the budget — saying it has been a “challenging year.” Toepel added that a number of taxes were eliminated from the budget that she said would have been harmful to local businesses and individuals.
She pointed out that there are still challenges ahead — with pensions and with increased investments in education.
“Education is 40 percent of the budget and we made increased investments this year,” she said. “There is an added $100 million in the basic education funding formula, $30 million into pre-K and Headstart and $25 million into special education.”
Another issue raised dealt with the Educational Improvement Tax Credit (EITC), which offers tax credits to eligible businesses that contribute to scholarship organizations or educational improvement organizations.
Quigley told the group that the budget includes a $10 million increase to that program.
“We’ve seen it benefit across the board for our schools, as well as the benefits to our businesses by being able to take advantage of that program,” he said.
For Hennessey, who is chairman of the Aging and Adult Services Committee, some of the spending challenges ahead relate to senior citizens. He told the group that by 2020, 20 percent of the population will be age 65 and older.
“You get an idea of the kind of challenges we face going forward in terms of expenses we have to meet in the budget to deal with the cost of keeping seniors healthy,” Hennessey said.
He added that the state’s budget includes no broad based tax increases.
“The consensus in Harrisburg developed that since we had still not recovered from the recession we were in, it was not the right time to raise taxes on people,” he said. “To the extent that we are having problems with our budgets in Harrisburg and trying to meet our financial demands, so too do all of you with your businesses and your families.”
The breakfast provided members an opportunity to raise questions about issues they may be facing, which Dautrich said is important for the entire group.
“As questions come up, it is beneficial to hear from other industries. Having a larger dialog helps everyone,” she said. “They may say — ‘this may not be my issue, but how might it trickle down to me and my industry.’”
Questions at Thursday’s meeting dealt with proposed legislation that could impact designers in Pennsylvania, transportation funding allocation, continued expansion of beer and wine sales in grocery stores, the status of the Keim Street Bridge project and a ballot question dealing with property tax.
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