Pennsylvania’s economic stability comes down to how far into the future budget planners look.
For Gov. Josh Shapiro’s administration, its “aggressive” $48.3 billion spending proposal asks for only one year of funding. In this case, $3.2 billion more than last year.
The Senate Republican lawmakers that stand as its primary critics, however, say the single-year rewards don’t outweigh the multi-year risks, or in this case, a $24 billion unaccounted-for bill that will come due for taxpayers by 2028.
Senate Appropriations Chairman Scott Martin, R-Strasburg, called the budget an “intentional lowball” with “rosy revenues” and “understated spending” during a hearing with the governor’s budget office on Thursday.
“With a $3.2 billion spending increase in a single year, I am convinced there was no option but for you to push revenue estimates higher and to arbitrarily lower spending projections just to make it appear on paper that Governor Shapiro’s massive spending proposal worked,” he said. “But it doesn’t work. The math is just not believable.”
Budget Secretary Uri Monson said the administration’s anticipated 2.2% annual spending growth for 2024-25 comes in less than the 3.9% average seen over the last 25 years.
Besides, he added, the state has an extra $14 billion combined in its checking and emergency saving accounts that should be reinvested into government.
“So we’re in another year of structural surplus where we actually brought in more than we spent,” Monson said. “And as a result, we are making the recognitions we are because, as the governor has stated quite clearly, he believes it’s the time to invest in Pennsylvania and Pennsylvanians.”
At the request of Republican lawmakers, the IFO again crunched Shapiro’s plan to project Pennsylvania’s financial condition in five years. The numbers include future expenses not accounted for in the administration’s own outlook, such as extra money spent on education as part of a plan to equalize funding across districts and a roughly $900 million annual increase in human services.
According to its analysis, Shapiro’s plan – if adopted in its entirety – would exhaust the extra $14 billion by 2026 and leave the state $24 billion in the red by 2028.
Sen. Tim Kearney, D-Media, said the assumptions in the analysis undermine its credibility.
“The IFO’s job is to perform an independent analysis basically not solve math problems for the General Assembly,” he said. “Doesn’t seem to be any analysis there and it certainly wasn’t independent. I mean you heard from the chairman that the IFO was literally given the numbers and told what to do with them.”
The conversation wrapped three weeks of marathon hearings with legislators and administration officials as they begin crafting a spending plan that can garner majority support. The budget deadline is June 30.
