An emerging recovery and improved cash-flow management mean Pennsylvania will probably not need as much short-term borrowing this fiscal year as originally planned, a senior state official said last week.
Michael H. Hershock, budget secretary to Gov. Robert P. Casey, said Pennsylvania has already eliminated about $475 million of short-term borrowing originally slated for sale in fiscal 1993.
"And I think it could go even lower," Hershock said Friday in remarks before the Municipal Analysts Group of New York.
Pennsylvania is planning about $375 million in short-term borrowing in January, but Hershock said he believes the state could make do with less. A decision on the ultimate size of the borrowing will be made over the next month or two.
A decision also will be made on whether to make the issue fixed-term notes or variable-rate commercial paper, he said.
A series of legislative steps to improve cash flow, including shifting payment dates on several state bills and collection dates for certain taxes, has been one factor in dramatically decreasing the need for short-term borrowing, Hershock said.
On other fiscal matters, the budget secretary said some of the state's economic vital signs appear to indicate an emerging but slow recovery, in line with the national trend.
Pennsylvania has a reputation for "dependable stability," Hershock said. The state typically suffers less during recessions and gains less during booms.
To balance the budget for fiscal 1992, which ended June 30, Casey raised about $2.7 billion in a mix of tax increases. But in contrast to the massive taxpayer revolt sparked by a similar move in New Jersey, Pennsylvania residents remained relatively calm after the increases were approved.