Nearly two weeks into the new fiscal year, Pennsylvania lawmakers fought through a flurry of votes on Thursday to adopt a budget deal, which had been stalled by differences during closed-door negotiations over Democrats’ demand for greater funding for public schools.
The budget for the fiscal year that began on July 1st, which is $47.6 billion, is 6% more than the amount that was previously approved. The majority of the additional funds will be used to improve the compensation of direct care workers in public schools and human services.
The plan also allocates hundreds of millions of dollars to compete for large-scale new projects like multibillion-dollar microchip facilities, and more funds to lower the cost of tuition in one of the least affordable states in the country.
Within hours of the rank-and-file members receiving their first glimpse at the hundreds of pages of budget-related legislation that were first made public on Thursday, votes in the Democratic-controlled House and the Republican-controlled Senate got underway.
Late on Thursday, following the primary spending bill’s passage by the House 122-80 and the Senate 44-5, Democratic Governor Josh Shapiro signed the law. Republican opponents criticized it as an extravagant and reckless budget that will increase debt and deplete surpluses in an aging state where deficits are expected to increase year over year.
The budget, according to House Appropriations Committee Chairman Jordan Harris, a Democrat from Philadelphia, exhibits a strong moral compass.
“This budget makes one of the most historic investments in what is our most valuable resources, and that is our children,” Harris stated.
The state’s two main revenue streams, sales and income taxes, are not raised by the plan, despite tax breaks for firms to write off larger losses and for students to write off loan interest.
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About $3 billion in extra funds will be needed to balance the account, leaving about $10.5 billion in reserve. Shapiro’s initial proposal was valued at $48.3 billion.
The bill increases funding for special education and teaching in public schools by around $900 million, or 9%. It also adds hundreds of millions more in new subsidies for building new schools and tuition for private and online charter schools.
About $526 million of the cash is intended to be used as a first step toward addressing a court ruling that determined the state’s school finance system violates the constitutional rights of pupils in less affluent districts.
Republicans and Democrats engaged in a behind-the-scenes battle for weeks over how to divide the funds.
Regardless, the plan is well short of the $6.2 billion increase sought by the districts who sued and prevailed in court for underfunded schools, which would be phased in over five years. Furthermore, it is less than the $870 million Democrats had sought as the initial installment of a $5.1 billion, seven-year raise.
The plan allocates an additional $260 million, or around 13% more, for higher education. The majority of this increase will go toward expanding student subsidies through the Pennsylvania Higher Education Assistance Agency and the state-owned university system.
Shapiro, on the other hand, had requested an additional $280 million for public transportation systems, or around 20% more, as they are still having difficulty regaining ridership following the pandemic. Rather, Republicans settled on roughly $80 million.
Shapiro has promised to compete with other states that are spending billions on incentives to entice large projects like electric vehicle battery facilities and microchip fabrication plants. He suggested taking out a $500 million loan to prepare huge land parcels.
The $500 million loan, which includes $100 million for extending sewage, water, and road systems, was approved by lawmakers.
