PA Debt Reduction Bill Moves to Governor’s Office

The Kittanning Market Street Revitalization Project has benefited from $1 million in RCAP funding through the State.

Half of the funding for the upcoming Market Street Revitalization Project in Kittanning initially came from the State.
$1 million in matching grant funds were received from the Commonwealth of Pennsylvania’s Revitalization Capital Assistance Program (RCAP), and now lawmakers hope to secure that possibility for other municipalities in the future.
The Pennsylvania General Assembly last week received unanimous bipartisan support to reform the state capital program, House Majority Leader Mike Turzai (R-Allegheny) announced.
The legislation passed the House unanimously – 194-0 – and would put new controls in place to curtail mounting levels of public debt for projects funded by the Redevelopment Assistance Capital Program (RACP)
RACP uses borrowed money to fund economic development projects selected by Gov. Tom Corbett.
“All state-funded projects deserve public scrutiny and careful evaluation, and this legislation will make it happen,” Turzai said. “Working with the governor and legislative leaders, we have been able to reduce the debt ceiling and debt payments, and we brought openness and accountability to the process.”
Rep. Eli Evankovich (R-Armstrong/Westmoreland) was one of those unanimous supporters.
“Today, we sent a historic piece of legislation to the governor which will reduce borrowing over time and put real constraints on discretionary borrowing here in Pennsylvania long term,” Evankovich said. “What this law will do after the governor signs it is require us to pay down our debt, reduce the overall limit long term so that we are not just saddling our children with more and more debt to pay for discretionary projects in the state.”
House Bill 493 – authored by Rep. Matt Gabler (R-Clearfield/Elk) – will immediately reduce the RACP debt ceiling from the current $4.05 billion to $3.45 billion.
The bill does not eliminate the economic development grant program, but redefines it and makes it financially visible, Turzai explained.
RACP provides grants to local communities for the acquisition and construction of regional economic, cultural, civic and historic improvement projects. The funding may be used for the design and construction of facilities that are economic development projects which general employment, tax revenue or other measures of economic activity.
No RACP project may receive funds unless the project was itemized in a capital budget itemization bill, a capital budget bill or a capital project itemization bill enacted within 10 years of the date the project is approved.
“Unlike the current dysfunction we currently see in Washington, D.C., we are showing in Pennsylvania that we can work in a bipartisan, bicameral manner to responsibly manage taxpayer dollars,” Galber said. “This is a good government bill that represents a significant win for our taxpayers, job creators and future generations of Pennsylvanians.”
According to a news release about the passage, this bill would ensure projects are chosen based upon merit, impact on economic development and level of public-private partnership, geographic disbursement and shovel readiness. The perception of favoritism would be removed if the legislation becomes law.
Finally, the legislation would create a more-stringent review and approval process within the Office of the Budget with eligibility criteria and other guidelines.