By: Christian Muniz and Lou Biacchi
On February 6th, 2018, Governor Wolf presented his proposed $33 billion Pennsylvania FY 2018-19 state budget to a joint session of the House and Senate. What is different this year? It’s election season for 203 House seats, half of the 50 Senate seats, and of course, the Governor himself.
So, it was not surprising that most political observers in Harrisburg got exactly what they had long predicted: a no-frills budget that may be done by early July. Or, as Philadelphia Inquirer columnist John Baer observed, a Governor who was essentially saying, “I’m up for re-election, so are you; let’s not do what we usually do.”
That’s not to say there won’t be disagreements. The Governor is proposing $1 billion in new spending, but that’s only about a 3% increase – a number many legislative Republicans recognized as a good starting point. And, while Wolf is continuing his push for increased spending for public education (not a surprise as this was a top campaign promise), he has also won accolades from some Republicans for focusing on technical education, or STEM (Science, Technology, Engineering and Math).
You are probably asking that if this budget is an election year budget, why not pass the budget by June 30th? The answer is this – it is an election year that involves the Governor’s reelection. There is a possibility that the budget will pass by the 30th of June but our belief is that the Governor and the Legislature will agree to a spending and revenue package no later than July 2nd or 3rd due to political considerations.
A number of budget highlights follow:
- Public schools: Already accounting for 29% of the entire state budget ($9.3 billion), Wolf’s proposed budget would increase spending to basic education by another $100 million and with added emphasis on STEM education. Additionally, his proposal adds $20 million for special education, $40 million for preschool and maintains the $250 million block grant to schools.
- Higher education: The Governor’s proposed $19.5 million increase offers a modest bump in spending to the 14 universities under the State System of Higher Education, making this the fourth year of increases for them. However, it is once again level funding for the state-related universities (Penn State, Temple, Lincoln and Pitt); University of Pittsburgh is represented by Pugliese).
- Intellectual Disability (ID) care: Wolf’s budget proposes an increase of $100 million for ID and autism services across the Commonwealth. This reflects a continuation of leadership by the Governor and General Assembly following last year’s increased ID funding. ID providers, while appreciative of last year’s increase, are having a difficult time retaining their direct service personnel, after a decade of level funding prior to last year’s budget, and so are requesting the Governor’s proposed increase be expanded by the General Assembly to give much needed raises to these employees. Note, Pugliese represents a number of ID providers: Barber National Institute, Keystone Human Services and SPIN.
- Opioid addiction: The proposed increase to the Department of Drug and Alcohol Programs by $46.5 million would include increased focus on opioid addiction.
- Increase in minimum wage: The Governor’s proposal would increase the state minimum hourly wage from $7.25 to $12.
- Marcellus Shale gas: Although Wolf did not propose increases to broad-based taxes such as income or sales, he again pushed his campaign promise to tax natural gas extraction in Pennsylvania, projecting a $250 million windfall based on a variable percentage tax that would be tied to the price of natural gas. Although the Senate passed a version of this tax last year, it is likely to continue to receive stiff opposition in the House, particularly among the more conservative members.
- State Police per capita fee: While the state police see a proposed increase of $8.8 million, the proposal is again tied to a $25-per-person fee in municipalities that do not provide for their own police coverage and instead rely on state police coverage. This would raise an estimated $63 million to shift the burden for paying for state police off of funds that are supposed to pay for road and bridge maintenance. The proposed $25 fee is about 1/10th the cost for Pennsylvanians who live in municipalities with police coverage (roughly $230 per person).