Pa. Treasurer Says Borrowing To Pay Bills Must End
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PITTSBURGH (KDKA) -- Pennsylvania State Treasurer Joe Torsella says he's drawing a line in the sand.
"This is not sustainable any longer," Torsella told KDKA political editor Jon Delano on Tuesday.
When the state runs out of money in mid-September, Torsella will no longer borrow money to pay for anything owed by the state.
"Once the general fund gets to zero, we don't have -- I can't constitutionally write checks 'cause we don't have the money to pay for them," he said.
Last June, the legislature approved a $32 billion spending bill, but the Republican-controlled state House has not only failed to act on a bill to pay for it, approved by the Republican-controlled state Senate, but they went home for 10 weeks over the summer.
"It defies commonsense, and it flies in the face of what most Pennsylvanians know. When you have a job to do and get paid to do it, you need to show up to work and do your job," said Torsella.
Torsella says borrowing money while the legislature dawdles downgrades the state's credit rating, driving up interest rates at a cost to taxpayers .
"That will be borne by Pennsylvania taxpayers. It's not going to show up on your tax bill, but it's higher costs that the state doesn't need and can't afford," he said.
The treasurer says the governor -- by borrowing $700 million from the Motor License Fund -- has bought a couple weeks for House Republicans to act in early September, but after that the borrowing ends.
Delano: "Sept. 15. Is that a key date in your mind?"
Torsella: "It's huge, Jon."
"On Sept. 15, the budget -- the general fund -- goes into the negative," he noted.
And Torsella says both the governor and legislators need to know that after that date he will not borrow money to pay state bills.
"I don't know of any historical precedent for Treasury lending money to the Commonwealth when there is no balanced budget," he said.
So what about state employees, including state lawmakers?
Will they get a paycheck after Sept. 15th?
No, says the treasurer.
If there is no money in the bank account, he can't process checks to pay anybody, including himself, along with legislators.
Torsella says he hopes House Speaker Mike Turzai and other House leaders reach a compromise with the Senate and the governor before it comes to that.
