Where's the money coming from?

In your household budget, you make decisions on how much money you can spend based on how much money you have. Makes perfect sense, because you can't spend what you don't have.

In government, though, as the Pennsylvania General Assembly just showed us last week, members passed a 2016-17 spending plan without passing an accompanying revenue plan.

Legislators are, in effect saying, "Here's what we want to spend, but we'll worry about where the money comes from later."

So, we have an on-time budget, sort of, unlike the fiasco that our legislators put us through last year when the 2015-16 budget didn't get fully implemented until nine months after the June 30, 2015, deadline.

Gov. Tom Wolf is generally supportive of the spending plan, but he cautioned that he has until July 10 to sign or reject the proposal, and he warned that he would not sign the main budget bill without a "sustainable revenue package."

Even key House Republicans could once again scuttle the deal, just as they did last December when all parties, except them, agreed to a compromise deal. That rejection led to another wrenching three months of anguish for school districts and state agencies which were counting on state money to stay afloat. House Republicans don't like a proposal to fund this year's budget with a new gross receipts tax on natural gas sales that would be borne by gas utility customers.

Here is the way the political "game" works in Harrisburg: Five different groups must agree on a spending blueprint before it can be implemented. They are: Senate Republicans and Democrats, House Republicans and Democrats and Democratic Gov. Wolf.

Since the Republicans control both houses by substantial margins (120-83 in the House and 31-19 in the Senate), you might ask, "Who needs the Democrats anyway?" The simple, political answer is: the Republicans do, because without broad-based Democratic support, it is unlikely that Wolf will agree to any spending plan. Republicans do not have enough of an edge to win a supermajority (two-thirds vote) to override Wolf's veto.

"There is no doubt it's kind of four-on-one," said House Majority Leader David Reed, R-Indiana County. "We are probably the only caucus that has said no on that particular proposal, and it's not just a matter of public policy, it's a matter of votes.

"We don't have the votes for it. And the House Democrats don't have the votes for it either. So in reality, folks can talk about it all they want, but it's just not realistic," Reed said.

When Wolf conceded that he would not demand an increase in a broad-based tax, including the state income and sales taxes, his staff came up with the gross utility tax alternative, which would raise an estimated $350 million a year.

House Republicans, however, believe that since this increase would affect more than 2.7 million Pennsylvania households that use natural gas for a home heating source, it has the impact of a broad-based tax, which they said they would fight to the death to avoid.

To try to address this stumbling block, the Republican House leadership came up with alternatives to raise $1.25 billion by increasing the tobacco taxes, expand legalized gambling, get higher profits from more liberalized liquor sales laws and a tax amnesty plan, which is projected to bring in $128 million.

Tax amnesty means that those who owe the state money from past years would be able to wipe the slate clean by paying up without being assessed fees and penalties as they normally would have to do.

Oh, yes, and don't forget the abracadabra factor - about $325 million in transfers from other state funds, unspent allocations, projected savings and accounting sleight-of-hand.

For their part, the House Democrats don't like the Republican plan, because they say if it's adopted, the budget comes up about $1.4 billion short, and, they charged, some of the projected revenues are too rosy and unrealistic. But possibly an even greater sticking point is the Republican proposal to expand legalized gambling. Existing casinos have put up a united front in opposing putting slot machines in places such as international airports.

Last week, the House voted 114-85 to approve a bill that would legalize online gambling, along with fantasy sports betting and add 5,000 slot machines at 20 new slots casinos. The Republicans believe this would result in nearly $267 million in taxes and fees for the state's new budget.

Mark Juliano, CEO of the Sands organization, which operates one of the state's most successful casinos and hotel in Bethlehem, said if this proposal is passed, he will pull the plug on plans for a new convention center, new hotel, upscale shops and an expanded concert venue, which has been wildly successful.

Juliano pointed to the Sands' large investment in Bethlehem. He said that even though Pennsylvania's 55 percent tax on casinos is the highest in the nation, the Sands has thrived in eastern Pennsylvania, but he also warned that this can change in a heartbeat if the legislators pass this proposal.

Juliano is already worried what might happen to business at the Sands if New Jersey voters approve a referendum in November to construct two new casinos in northern New Jersey.

Pennsylvania Democratic leaders want to be sure that the Legislature does not kill the goose that has laid the golden gambling egg. Sen. Vincent Hughes, D-Philadelphia, ranking Democrat on the Senate Appropriations Committee, said the first order of business with gaming is to "do no harm" to what is already in place, and he fears that the Republican proposal would do just that.

Because of recent bipartisan agreements, the smell of compromise, collaboration and collegiality is still in the air, and many legislators are confident and optimistic that an equitable agreement can be hammered out soon.

There is, however, a powerful cadre of Republican legislators who are not in a negotiating mood, so this delicate balance of camaraderie for the common good could be knocked off its foundation, just as before.

The big difference this time, though, is that this is an election year, and with all 203 members of the State House of Representative and half of the 50 state senators up for re-election on Nov. 8, miscalculating the mood of the voters could prove to be a disaster to their future.

By Bruce Frassinelli | tneditor@tnonline.com