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    Home Uncategorized Highlights of Pennsylvania governor's state budget proposal
    Highlights of Pennsylvania governor’s state budget proposal
    February 5, 2020

    Highlights of Pennsylvania governor’s state budget proposal

    By The Associated Press

    HARRISBURG (AP) — Highlights of Pennsylvania Gov. Tom Wolf’s spending plan for the 2020-21 budget year that starts July 1:

    THE BIG PICTURE

    — Increases spending through the state’s main bank account to $36.1 billion. Including nearly $600 million for the current fiscal year, Wolf is seeking authorization for another $2.6 billion in new spending, or 7.6% of this year’s enacted budget of $34 billion.

    — Projects a 4.5% increase in tax collections to $37.3 billion, before refunds. Does not increase tax rates on sales or income, the state’s two biggest sources of revenue.

    — Asks lawmakers to expand a bond-funded redevelopment grant program by $1 billion and make the money available for the cleanup of lead, asbestos and other environmental health hazards in school buildings.

    — Calls for lawmakers to raise the state minimum wage to $12 an hour on July 1, up from the federal minimum of $7.25 an hour.

    TAXES AND FEES

    — CORPORATE INCOME TAXES: Restructures how the state would calculate corporate profits to adopt “combined reporting” and reduces the current 9.99% tax rate by annual steps to 5.99% in 2025. The change is estimated to produce an additional $240 million in revenue in 2020-21.

    — STATE POLICE FEE: To help fund the state police budget, imposes a fee on each municipality that would be driven by incidents and coverage area, and weighted by population, income and whether a municipality has its own full-time or part-time police force. The administration estimates the fee would produce $136 million.

    — MUNICIPAL WASTE: Imposes an increase of $1 per ton on municipal waste hauling to generate $22.6 million for the Hazardous Sites Cleanup Fund, which is projected to be out of money at the end of 2020.

    — GAS DRILLING: Seeks approval of a tax on Marcellus Shale natural gas production to underwrite a $4.5 billion “Restore Pennsylvania” infrastructure program. Using estimates of 2019 production and a price of below $3, the tax would yield more than $600 million in a year.

    SAVINGS MEASURES

    — Delays a $377 million payment to providers for long-term programs for the elderly.

    — Taps $275 million in surplus cash already appropriated, but left unspent in state accounts.

    SPENDING BY CATEGORY

    — HUMAN SERVICES: Grows $1.2 billion, or 9%, to $14.4 billion.

    — PRE-K and K-12 EDUCATION: Grows $170 million, or 2%, to $9.2 billion.

    — HIGHER EDUCATION: Grows $58 million, or 3%, to $1.8 billion.

    — CORRECTIONS AND PAROLE: Shrinks $73 million, or 3%, to $2.6 billion.

    — PENSIONS: Grows about $150 million, or 4%, to $3.7 billion.

    — STATE POLICE: Grows $45 million, or 4%, to $1.4 billion.

    — DEBT: Grows $6 million, or 0.5%, to $1.15 billion.

    EDUCATION

    — Increases aid for general public school operations and instruction by $100 million for basic instruction and operations, an increase of 1.5%, to $6.9 billion.

    — Calls for every school district to provide free, full-day kindergarten. The administration did not estimate how much such a move would cost.

    — Diverts more than $200 million in revenues from a tax on slot-machine gambling that subsidizes the state’s horse racing industry to fund scholarships for students at a State System of Higher Education university if they remain in Pennsylvania for as long as they receive the benefit.

    — Establishes a statewide cyber-charter school tuition rate that would save $133 million a year for school districts.

    — Changes special education reimbursements for charter schools to save $147 million a year for school districts.

    Tags:

    budget economics fee finance income rate reimbursement revenue tax rate tuition

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