Pennsylvania's House of Representatives, after an afternoon of closed-door caucuses and parliamentary wrangling, moved toward a Wednesday vote on the full $30.8 billion budget framework on which Gov. Tom Wolf and Senate leaders agreed.

By a 100-97 vote late Tuesday afternoon – six of the 203 members were granted leave -- the House agreed to replace an 11-month, $28.1 billion spending plan up for consideration with the Wolf- and Senate-backed package, though details about its $1.2 billion revenue component were still unclear.

Pennsylvania is deep into the sixth month of gridlock between Wolf, a first-year Democratic governor, and the Republican-controlled legislature over a spending plan for fiscal 2016, which began July 1.

Speaker Mike Turzai, R-Marshall Township, said that by House rules, the soonest vote – called "third consideration" -- could come Wednesday.

Wolf, who vetoed a stopgap budget on Sept. 29, said he would do so again.

The governor wrote lawmakers earlier Tuesday outlining what he considered the detrimental consequences of a stopgap budget will have on Pennsylvania.

"A stopgap budget does not change the status quo that Harrisburg has accepted for too long," he said. "It does not restore funding to our schools, and it does not begin to fix our deficit."

Consequences, he said, would include the furlough of 8,000 commonwealth employees with the biggest impact on corrections and the State Police. In addition, he said, a $455 million cut to schools could lead to further program cuts and layoffs. Various social service programs would also face a combined $160 million in cuts, he added.

Wolf and Senate leaders earlier this month had agreed to a budget framework that would include a $1.2 billion tax-and-revenue package, though a tax code is still lacking.

Holding up the package was Saturday's defeat of a companion pension bill that would have moved future state government and school employees into a hybrid pension system, combining a traditional defined-benefit plan with a 401(k)-style defined-contribution plan.

Moody's Investors Service rates Pennsylvania's general obligation bonds Aa3 with a negative outlook. Fitch Ratings and S&P rate them AA-minus, with stable outlooks.

All three agencies downgraded the commonwealth in 2014, citing budget imbalance and the pension liability.

Wolf and Senate leaders agreed for $350 million in additional basic educational spending, while House leaders prefer to trim that increase to $150 million.

Last week, Standard & Poor's withdrew its ratings based on the commonwealth's state aid intercept program for school districts and community colleges. The program guarantees debt-service payments by redirecting basic education funding or state aid payments from a school district in default to the paying agent bank, providing better loan terms for distressed districts.

"S&P withdrew its rating because the budget impasse directly undermines the program," said Bank of America Merrill Lynch.

Philadelphia Superintendent William Hite said his district might have to close its schools on Jan. 29.

 

 

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