Media
Time to End Borrowing for Corporate Welfare
The Pa. House is expected to vote this week on SB 1054, legislation to authorize $1.66 billion in state borrowing for the “capital budget.” The annual cost of this bill would be $115 million per year for 20 years in annual interest and principle payments. In a memo to legislative leaders urging passage, Budget Secretary Charles Zogby claims the additional debt is needed to finance projects the commonwealth is already contractually obligated to fund.
Of this borrowing, $270 million would be for Redevelopment Assistance Capital Projects (RACP). Borrowing for RACP is one of the drivers of Pennsylvania state debt—a growing problem as interest payments continue to rise, while taxpayers’ debt continues to grow year after year.
RACP borrowing has been used to fund everything from corporate headquarters to sports stadiums to the Arlen Specter Library. Most recently, RACP was the source of a $3 million grant to the Second Mile, the charity founded by accused child molester Jerry Sandusky.
In response, Rep. Rosita Youngblood (D-Philadelphia) is holding a press conference tomorrow to call for reforms to the RACP program to promote greater transparency and accountability. These reforms are much-needed, but better yet would be to eliminate future RACP borrowing altogether and stop accruing debt for corporate welfare.