HARRISBURG, Pa. (KYW Newsradio, AP) — Gov. Tom Wolf signed Pennsylvania’s main budget bill after the state Senate overwhelmingly passed it Friday, more than a week after it was due. The plan was fattened by federal stimulus cash and unusually robust state tax collections.
Big winners were public schools, environmental programs and long-term care facilities, but the budget also will leave some $5 billion in the state's rainy day fund, create a multibillion-dollar cushion for next year and cut the tax on corporate net income.
The Senate approved the plan 47-3 after the House passed it by a similar margin the prior evening.
“This spending plan is about investing and setting the stage for a bright future for our great commonwealth,” said Appropriations Chairperson Pat Browne, R-Lehigh.
“While there may be legitimate concerns that the funding for education in this year's budget includes appropriations above any previous levels that we have supported, the agreed-to education spending increases were made with the expectations that they will promote greater equity and education for our most challenged school districts.”
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Appropriations Minority Chairperson Vincent Hughes, D-Philadelphia, credited Browne for his work on the plan.
“Browne … dug this process out all the way to the very end, trying to find spaces where we could come together, trying to find common ground,” Hughes said.
The $42.8 billion general fund spending plan includes hundreds of millions to clean streams and renovate or repair parks and forest land, and new money for home repairs, flood control, sewer and water infrastructure, child care, additional state troopers, anti-gun violence efforts and mental health support. Along with $2.4 billion in federal American Rescue Plan Act and federal Medicaid match money, the total spending is $45.2 billion.
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K-12 education spending jumps by more than a half-billion dollars, and Pennsylvania's 100 poorest districts are splitting an additional $225 million. There are also larger subsidies for early childhood education, special education and the state-owned Pennsylvania State System of Higher Education.
“We all made compromises,” said Senate Majority Leader Kim Ward, R-Westmoreland. “None of us got what we wanted, but we all came to a good compromise.”
With strong majorities in both chambers, Republicans got a lot of what they wanted, including a 1% decrease in the corporate net income tax and a program to help counties run elections while prohibiting the type of outside financial support that was controversial during the 2020 election.
The state fund will be used to help counties register voters, prepare and administer elections and audit the results.
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The budget includes more money for a property tax and rent rebate program for seniors and to help lower-income people afford the cost of heating.
A new $125 million “whole home repairs program” was started, offering grants of up to $50,000 for homeowners with household incomes at or below 80% of local median income. Some landlords will also qualify for forgivable loans. The money can be used to make homes habitable, make utilities more efficient or improve access for those with disabilities.
Ward called it the first functionally balanced budget in Pennsylvania since the late 1990s. In recent years, lawmakers have regularly relied on one-time infusions of cash and accounting tricks to “balance” the state budget, but the 2022-23 plan repays some $2 billion in budget-related borrowing while paying off a $42 million debt in the unemployment compensation trust fund.
The Educational Improvement Tax Credit Program, a state-run effort popular with Republicans that gives businesses tax breaks in return for donating to private school tuition, will rise by 45% to more than $400 million.
As part of the deal, Wolf has agreed to pull charter school regulations that had been approved in March.
While this bill handles the bulk of the budget, there are other related bills working their way through the General Assembly.
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Budget won't provide as much funding for Philly schools as district had planned
The state budget that was approved and signed on Friday provides more funding for Philadelphia schools, but not as much as the district budgeted for.
When the School District of Philadelphia adopted its $3.9 billion budget at the end of May, it based state funding on Wolf’s proposed budget. District Chief Financial Officer Uri Monson said the new state budget provides less than half of the boost the district had planned on.
“It obviously is an increase in education spending,” said Monson. “It’ll probably net out across all areas, about $200 million more for the district. However, it’s well short of what we had put in the budget based on the governor’s proposal.”
But that shouldn’t result in significant cuts to the district’s operating budget.
Monson said the district was cautious with its budget, setting aside programs that were “to be determined” if the governor’s proposal was adopted. He added that the district has a $500 million fund balance left over from last year.
But Monson added having less recurring state funding will need to be resolved in the district’s five-year plan, especially when federal COVID-19 relief runs out next year.
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