On behalf of the more than 20,000 members of the National Taxpayers Union (NTU) in Pennsylvania, I urge you to support and work for the passage of SB 4, the Taxpayer Fairness Act. This legislation, introduced by Senators Brightbill and Piccola, would construct some "fiscal guardrails" to slow the growth of government spending in Pennsylvania. We agree with Governor Rendell's Inaugural Address comments that "we must find a way to make government live within its means." SB 4 provides that way.
The spending limits contained in the legislation are modest and - rather than cutting the state's budget as many will undoubtedly argue - will allow for government spending to grow commensurate with citizens' abilities to pay. Under the Taxpayer Fairness Act, state spending would be limited to the lesser of a) the average annual rate of change in personal income in the state for the three preceding years or b) the average percentage change in inflation plus the percentage change in state population for the three preceding years. While we would encourage state government to return excess tax revenues to the taxpayers, SB 4 would place 100 percent of any tax surplus into the state's Rainy Day Fund. Aside from periods encompassing various declared emergencies, a two-thirds vote of the Legislature would be necessary to override the spending limit.
The dramatic growth of state government spending over many years demonstrates the immediate need for stricter budget controls. In fact, state government spending in just the last two years increased by more than $450 for every man, woman, and child in the Commonwealth. In total, state government spends more than $16,700 per family of four - or $1,800 more than it did in 2003 when Ed Rendell became Governor.
The high taxes needed to pay for this spending have contributed mightily to Pennsylvania's abysmal economic performance indicators during the last two years. Pennsylvania was 38th in the nation in job growth, 41st in personal income growth, and 45th in population growth. Add to these poor performance indicators the recent Forbes Magazine's ranking of Pennsylvania as 45th in economic freedom in the nation, and the need for spending restraint in Harrisburg is all the more apparent.
If Pennsylvania could tax, borrow, or spend itself to prosperity, it would already be there. Of course, fiscal irresponsibility didn't start with Governor Rendell, but it should end with him. Now is the time to introduce needed fiscal restraint to this broken system. I urge you to support the Taxpayer Fairness Act today!
Paul J. Gessing
Director of Government Affairs