Governor Corbett Orders Freeze of Nearly $160 Million in State Spending

HARRISBURG, Pa., Jan. 4, 2012 /PRNewswire-USNewswire/ -- With commonwealth revenues continuing to come in below estimate for the 2011-12 fiscal year, Governor Tom Corbett has directed his Budget Office to freeze nearly $160 million in state spending.

The governor also has asked government entities not under his jurisdiction to reduce their spending by nearly $66 million.

"Until revenue collections improve, we must take precautions to ensure that the commonwealth budget remains in balance," Governor Corbett said.

Midway through the state's fiscal year, revenues are $486.8 million below estimate, the state Department of Revenue reported Tuesday.

Governor Corbett has directed most agencies to reduce their overall 2011-12 spending by 3 percent. Some individual appropriations will see spending reductions of up to 10 percent.

The state-related universities – Penn State, the University of Pittsburgh, Temple and Lincoln universities – will see a reduction of 5 percent, or $25.7 million, in state funding. 

Public safety agencies, such as State Police and the Department of Corrections, will freeze approximately 1 percent of their spending. The Pennsylvania Emergency Management Agency is not being directed to freeze any funds because of the numerous disaster-related emergency response activities that agency has coordinated this fiscal year, the governor said.

Basic education subsidy funds paid to school districts will not be affected, and the Department of Public Welfare will see a spending reduction of less than 1 percent, or $55 million. 

The funds being placed into budgetary reserve across all agencies represent less than 1 percent of the total $27.2 billion General Fund budget.

"We did not make the decision to freeze these funds lightly. If the revenue picture improves in the months ahead and we determine these funds no longer need to remain frozen, we may be able to free up some or perhaps even all of the funds we are now placing into budgetary reserve," Corbett said.

For a list of funds placed into budgetary reserve, please visit the Current and Proposed Commonwealth Budgets section of the Office of the Budget website at www.budget.state.pa.us.

Media contact:  Susan Hooper, 717-265-8067

SOURCE Pennsylvania Office of the Governor