By Pittsburgh Business Times

Gov. Ed Rendell signed the $28 billion 2010-11 state budget into law Tuesday, less than a week after it was approved by both houses of the Pennsylvania Legislature.

"The cuts simply reflect the economic realities that all states now face -- when you have less money, you have to reduce spending," Rendell said while signing the budget at Elmwood Elementary School in Mechanicsburg. "Everyone dislikes something about this budget. There are many spending cuts that I would much rather have avoided. We had to reduce spending on many programs that are important to me and to millions of other Pennsylvanians, but there is simply no way to balance our budget without pain."

The budget agreement calls for the Legislature to enact a severance tax on natural gas extraction in the Marcellus Shale by Oct. 1, Rendell said, with the tax becoming effective Jan. 1. He said he would like to see a tax rate close to West Virginia's, which is roughly 6 percent.

The upcoming 2010-11 budget is the first in Rendell's eight-year tenure to be passed by the Legislature before the June 30 deadline.

The governor is scheduled to sign economic development legislation Wednesday in Pittsburgh.

Copyright 2010 American City Business Journals
Copyright 2010