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Loss of $850M in federal funding potentially 'disastrous' for Pa.

July 27, 2010|By JENNIFER FITCH
  • Pennsylvania Gov. Ed Rendell
File photo,

CHAMBERSBURG, Pa. -- Pennsylvania Gov. Ed Rendell will talk to legislative leaders next week about what they'll do without $850 million in federal funding built into the state's 2010-11 budget, his spokesman said Tuesday.

Congress can decide before Oct. 1 to provide states with additional money targeted to health care assistance for the poor and elderly, spokesman Gary Tuma said.

Optimism of that happening seems to be waning.

"We're simply less optimistic than we were," Tuma said, saying there are indications the funding won't be approved.

When plugging FMAP (Federal Medical Assistance Percentages) into the budget, Rendell, a Democrat, cautioned of the consequences of not receiving the aid. He said public school districts could lose their planned funding increases and up to 20,000 state workers could lose their jobs.

Tuma said the state is legally obligated to cover citizens in need, and a greater number of people are asking for assistance in the weakened economy. Money must come from elsewhere in the budget to provide those services if the $850 million doesn't materialize.

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That will lead to "serious budget cuts" in "almost all areas of the budget" and spending freezes will begin soon, he said.

Franklin County (Pa.) Human Services Administrator Richard Wynn said he's been following the situation closely. He's anticipating funding cuts of 8 to 10 percent in welfare programs, something he called "disastrous."

"For many of my programs, it'd mean dismantlement," Wynn said.

Decreased funding, which follows cuts over the past couple years, would most affect the community services department, Wynn said. That department serves as a clearinghouse to refer clients to appropriate services, and it assists the homeless, he said.

"It's a serious thing," he said.

In June, state Rep. Rob Kauffman, R-Franklin/Cumberland, criticized using uncertain federal funding to balance Pennsylvania's budget. He said Tuesday that he continues to doubt whether the FMAP funding will be approved by Congress.

"Most of us were going under the assumption it wouldn't come through," he said.

State Rep. Todd Rock, R-Franklin, shared concerns that after the state budget passes, the governor has control over spending reductions.

"The governor has full discretion to make the cuts. ... But I'm sure he's going to involve the legislature to some degree," Rock said.

Tuma said Rendell has visited Washington, D.C., several times and talks to Senate Majority Leader Harry Reid often to champion the cause.

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