Rep. Seth Grove (R-Dover) released today a report on the costs Pennsylvanians pay in interest for intergovernmental loans.
The Pennsylvania Treasury has been providing billions of dollars in loans, which carry interest, to cover General Fund expenses and it’s only getting worse. Grove’s report highlights the high costs incurred by taxpayers just to pay the interest on the loans, which is expected to reach $15 million this fiscal year and potentially more due to the economic repercussions from the global pandemic.
“Spending $15 million on interest due to the Commonwealth borrowing from itself is wasteful government spending. It does not add any value to any Pennsylvanian. It does not educate children. It does not fix roads. It does not drive improved outcomes, increased efficiency or provide better services. It is a cost reflective of a culture of financial mismanagement and poor budgeting practices,” Grove said.
“This is like moving money from your savings to your checking account and then charging yourself interest when you move the money back from your checking account to your savings account,” Grove continued. “In Pennsylvania’s case, interest paid for the government to borrow from itself comes from one source – the taxpayers.”
In addition to stating the problem and high costs of the loans, Grove’s report provides solutions so taxpayers are not stuck in an intergovernmental borrowing scheme for decades to come.
Grove’s in-depth report can be found on his website, www.RepGrove.com
. Simply click on “Cash Management Report” under the Initiatives tab.
Representative Seth Grove
Pennsylvania House of Representatives
Media Contact: Greg Gross