Pennsylvania delays $1.7B in payments amid budget stalemate

Pennsylvania state government will delay more than $1.7 billion in payments due largely to Medicaid insurers and school districts, Democratic Gov. Tom Wolf said Friday, amid an unprecedented cash crunch and a fight in the Republican-controlled Legislature over how to plug a projected $2.2 billion budget hole.

Wolf’s office issued the brief statement acknowledging the delays on the day the state’s main bank account was projected to dip below zero. Wolf did not make a public appearance to discuss the payment delays, but his office said he would speak with top lawmakers by telephone over the weekend to discuss the budget stalemate.

The payments are reimbursements for medical care, addiction treatment and mental health counseling under Medicaid and for the state’s share of pension obligation payments to Pennsylvania’s school employees pension fund. The Medicaid reimbursements, due Friday, will be delayed for at least a week, Wolf’s office said.

School districts expected the pension obligation reimbursements to be delayed by a matter of a few days, although state officials expect rolling delays of payments, at least until spring, for as long as the budget stalemate goes on.

“We’ve been told it’s going out next week,” said Jay Himes, executive director of the Pennsylvania Association of School Business Officials. “After that, we’ve been told, ‘Don’t hold your breath.'”

John Callahan, of the Pennsylvania School Boards Association, said the organization was relieved that Wolf’s administration would be able to make the pension payment to districts, but it worried about the fate of a bigger…

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