Poor targeted in Pa. budget

DPW replaces schools on chopping block with $471 million cut proposed.

Posted: June 21, 2011

When Gov. Corbett proposed to balance the budget by cutting hundreds of millions of dollars from universities and public schools, squawks of protest erupted throughout Pennsylvania.

Neither deaf nor politically unsavvy, House Republicans listened to the noise, then came up with a new plan to restore nearly $600 million in aid to education.

So if schools are, to some extent spared, who will bear the brunt of budget cuts?

The House's Republican majority, elected on pledges of new ideas - smaller government, ethics reform - settled on a not-so-fresh notion: Cut funding for the poor.

The plan approved by the House last month would slash $471 million from Corbett's proposed budget for the Department of Public Welfare. Legislators vow to trim welfare "waste, fraud and abuse." They say it's necessary after the loss of $1.7 billion in federal stimulus funds to DPW.

The proposed welfare cuts have been all but overlooked amid the outcry over school aid. But advocates for the poor say the House GOP proposal, which includes $280 million in Medicaid cuts, will hurt citizens who depend on state help for survival.

The cuts would amount to ending Medicaid coverage for 100,000 Pennsylvanians, says Sharon Ward, executive director of the liberal-leaning Pennsylvania Budget and Policy Center.

Her interpretation doesn't jibe with calculations made by Republicans, who foresee far less dire effects, says Mike Stoll, House Appropriations Committee spokesman.

Still, the Medicaid cuts could have far-reaching consequences - triggering a loss of up to $425 million in federal matching funds, according to an analysis by Mike Wood, research director of the policy center.

Medicaid provides health coverage for 2.3 million low-income, elderly, and disabled Pennsylvanians. Fifty percent are under 18.

The House plan would also cut about $37 million in cash grants - welfare - to the poorest Pennsylvanians, and $38 million from programs that help low-income people afford child care while they work, or train for work, so they can get off welfare.

Wary of the cuts' impact, seven Philadelphia-area Democratic legislators sent a letter last week to express "deep concern" to Gary Alexander, acting secretary of DPW. They said proposed changes to the welfare-to-work program may "make it more difficult for low-income Pennsylvanian families to find jobs on their own. ..."

A spokesman for Alexander said the acting secretary had no comment on the letter or on DPW's budget.

Stoll and other Republicans say DPW is hampered by inefficiencies estimated to cost the agency $158 million. Last month, Alexander said at his confirmation hearing that although he was not certain how much could be saved by rooting out waste, he was confident savings could be found.

But how much "waste, fraud, and abuse" is there?

Republicans cite audits completed last year by state Auditor General Jack Wagner, a Democrat, who found that DPW's error rate for determining Medicaid eligibility was around 15 percent.

Then-Gov. Ed Rendell, who often clashed with Wagner, called that number "out of whack" and cited a federal audit that put the error rate about 4 percent. Wagner stood by his findings.

Though welfare recipients are often viewed as cheats by a suspicious public, evidence suggests that's rarely the case. In recent years, the Philadelphia District Attorney's Office has investigated accusations of welfare fraud and found real instances of crime to be statistically insignificant.

"Nobody has ever proved systemic fraud at DPW," said Michael Froehlich, an attorney with Community Legal Services in Philadelphia. "It's all anecdote."

Meanwhile, Corbett wants to cut the state's food-purchase program by nearly $400,000 - small change in a $27.3 billion budget, but bad news for the food pantries frequented by the needy.

Those pantries might have to start paying for food that had been provided free. Advocates say the church volunteers who run many Philadelphia-area pantries - mostly elderly women, often infirm and on fixed incomes - would have to go into their own pockets to buy the food.

The proposals come as Republicans in Congress, too, are looking to lower the budgets of nutrition programs serving America's poor.

An axiom of budget preparation, whether in Harrisburg or Washington, is that those least able to afford cuts are often chosen to make the biggest sacrifices, said Roberta Iversen, an expert on low-income families at the University of Pennsylvania.

"They are literally cutting the budget on the backs of the poor," she said. "Why? It's an old idea that if someone is poor, it must be their fault."

The debate in Harrisburg isn't over. The state Senate will likely offer its own proposal on DPW within a week.

But with a June 30 budget deadline looming, the time for new ideas is running out.


Contact staff writer Alfred Lubrano at 215-854-4969 or alubrano@phillynews.com. Read his blog, "The Joint Custodian," at www.philly.com/jointcustodian.

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