PA Budget Update: Governor Wolf Approves Budget Package Before June 30 Deadline
A nearly $34-billion state budget package was sent to Governor Tom Wolf’s desk ahead of schedule. The compromise budget plan boosts aid to public schools and universities, makes another investment in school security, bolsters the state’s agricultural industry, provides dollars for new voting machines, holds the line on taxes, and puts cash into reserve. It does not increase tax rates on sales or income, the state’s two biggest sources of revenue, and deposits nearly $300 million into the state’s so-called rainy day fund, for the first time in years. While the budget is touted as a 1.8 percent increase in spending compared to the current year, conservative groups say the spending increase is much higher than that when compared to what lawmakers approved a year ago, before adding supplementals and transfers.
The spending plan includes $160 million more in funding for K-12 education, an additional $50 million for special education, $60 million for School Safety grants, an additional $10 million in support of career and technical education, $25 million more for early childhood programs, and an extra $25 million for a program that provides tax credits to businesses that donate money for scholarships to private schools for needy students. It also provides 2 percent increases in funding for the four state-related universities — Temple, Pennsylvania State, Pittsburgh, and Lincoln; and a 2 percent funding bump for community colleges.
The budget package does not include an increase in the state’s minimum wage, a key goal for Democrats. Governor Wolf had proposed raising it to $12 an hour on July 1, up from the federal minimum of $7.25 an hour, with incremental increases after that; does not include money for higher teacher salaries. Wolf proposed raising the minimum salary for public school teachers and similar professional employees from $18,500 a year to $45,000 a year — all paid for with state money; does not impose a per person fee from municipalities that do not have their own full-time police force and instead rely solely upon state police for coverage. Wolf had proposed a sliding-scale fee based on a municipality’s population to raise $103 million; does not restructure how the state calculates corporate profits to adopt “combined reporting” or reduce the corporate net income tax rate. Wolf had proposed both; does not impose a tax on Marcellus Shale natural gas drilling to fund a $4.5 billion borrowing program that Wolf had proposed separate from the state budget to pay for upgrades to infrastructure and development projects; does not authorize the state to join a regional consortium that sets a price and caps on greenhouse gas emissions from fossil fuel-fired power plants; and does not impose Wolf’s new tax on cost-effective, community-based surgery centers.
Pennsylvania’s 2019-20 fiscal year commenced on July 1. With the budget wrapped-up, lawmakers are in recess for the summer break and will return in mid-September. The state House returns September 17 and the state Senate on September 23.