HARRISBURG, Pa. (KYW Newsradio, AP) — Gov. Josh Shapiro delivered his first budget late Tuesday morning to a joint session of the House and Senate. He laid out an ambitious agenda in a nearly hour-and-a-half long rousing speech that, at times, felt more like a campaign stop than a funding presentation.
The governor is proposing a hefty increase in aid to education, health care and social services, but the Democrat’s administration also emphasized prudence, saying a massive cash surplus will dwindle over time.
The budget proposal comes as Pennsylvania keeps taking in robust tax collections, leaving the state with $11 billion in reserve cash, even as the administration faces demands for more money for schools, highways and social services.
Spending would rise modestly while Shapiro is proposing no increases in income or sales taxes, the state’s two main sources of revenue.
All told, Shapiro’s budget plan for the 2023-24 fiscal year that starts July 1 boosts spending to $44.4 billion, an increase of almost 4%.
His administration said it will seek no tax increases, other than a slight increase in an emergency services fee — from $1.65 to $2.03 on monthly telephone bills — to fund county emergency response systems.
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On the flip side, Shapiro is proposing to eliminate taxes of 11% on mobile phone service — a promise he made during last year’s campaign.
In the meantime, good fiscal times could be ending. The proposed budget will need to siphon about $2 billion from reserves, as tax collections are projected to dip.
Shapiro is calling for:
— A state minimum wage hike.
— An increase in SNAP benefits to battle childhood hunger.
— Dedicated funding for state police rather than pulling from transportation funds.
— Increased funding for the Department of Environmental Protection.
— An expanded property tax rent rebate program for seniors and people with disabilities.
— A revitalization program for “Main Streets” across Pennsylvania.
— A tax credit for people who get licensed or certified in fields that are experiencing a significant workforce shortage, like nursing, teaching and public safety.
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“Whether folks in this room like me or not, the one thing I hope you can all agree on is that I’m competitive as hell — and I’m sick and tired of losing out to other states.”
Republican response: How will we pay for it?
Shapiro’s general theme is finding bipartisan solutions to lower costs and taxes to invest in people and businesses.
The budget will require approval from the Democratic-controlled House and the Republican-controlled Senate.
With that split government, Shapiro said, Pennsylvania voters sent a clear message to Harrisburg: “They asked us implicitly to come to the table, put aside the gimmicks or partisan litmus tests, and deliver commonsense solutions to the very real problems that we are facing every day.”
Senate Republicans questioned the price tag on the governor’s wishlist.
“The governor said a lot of things that we can all get on board with. We just need to find out how we’re going to pay for those things,” said Sen. Kim Ward, R-Westmoreland, president pro tempore.
“Basically we’re going to have to see. The devil’s always in the details.”
House Republicans say the spending proposals will grow the deficit and dry up the current budget surplus.
House Minority Leader Bryan Cutler, R-Lancaster, called the budget a starting point --- "a starting point that will end in a final budget that reflects no one person’s spending priorities or legislative agenda, but a budget that is reflective of the divided government we have."
House Republican Whip Tim O’Neal, R-Washington, said the spending plan doesn't meet the needs of Pennsylvanians. "In short, the budget offered by Gov. Shapiro today sets us on the road with unsustainable spending to a place where Gov. Shapiro will need to increase taxes in the future."
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Not enough to fix school funding
Perhaps the most prominent feature of Shapiro’s budget is what he said would be a “down payment” on the billions of dollars that public school allies say are necessary to comply with a Commonwealth Court decision that found Pennsylvania’s school funding system violates the constitutional rights of students in the poorest districts.
He is proposing an increase of $567 million — or about 7% more — for day-to-day school operations, plus about $100 more apiece for special education, mental health counselors, anti-violence grants, and removing environmental hazards in school buildings like mold, lead and asbestos.
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That cash, however, disappointed public school advocates and the school districts that won last month’s landmark court decision. They had hoped for at least $2 billion to start.
Shapiro issued a call to action for “a once-in-a-lifetime opportunity” to do right by Pennsylvania’s students. “As he recognized, the current budget proposal does not do that,” a Public Interest Law Center spokesman said Monday in a critique released jointly with the Education Law Center and O’Melveny & Myers LLP.
Critics emphasize the basic and special education funding increases are only just enough to keep school funding on pace with inflation. In fact, they say, the proposal takes a step backward from last year’s education budget, which included a $768 million basic education funding increase --- including $225 million bump for the commonwealth’s 100 most deeply underfunded districts through the Level Up program.
"Students need a budget proposal this year that begins to change the inadequate and inequitable public school funding status quo in Pennsylvania, and provides students with the educators and resources that allow them to realize their potential,” the statement went on to say.
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