Pennsylvania Gov. Tom Wolf’s proposed $30 billion budget brings new ideas to the table but faces stiff political headwinds, capital markets observers said.

Wolf, a Democrat who unseated Republican Tom Corbett last November, submitted to lawmakers two weeks ago a spending plan like no other.

“This budget reflects a fundamentally different approach to state government and puts back on the table a number of legislative ideas,” said William Rhodes, public finance chairman at Philadelphia law firm Ballard Spahr LLP.

Moody's Investors Service, Standard & Poor's and Fitch Ratings downgraded the commonwealth last year, citing the pension liability and budget imbalance. Moody's rates the general obligation bonds Aa3, while S&P and Fitch both assign AA-minus ratings.

Wolf said his budget closes a $2.3 billion deficit.

“We’ve seen a lot of this before, but not all in one state budget,” said Rhodes, who also leads Ballard Spahr’s municipal recovery initiative. “It will take an incredibly complex political dynamic to see this through.”

Wolf must wrestle in Harrisburg with a Republican majority in both branches of the legislature.

“Not a weak majority, but a strong majority,” said Rhodes. “Can he strike a grand bargain? I don't know.”

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