HARRISBURG – The Senate approved a $45.2 billion General Fund Budget for Fiscal Year 2022-23 that meets the needs of Pennsylvanians today without creating multi-billion-dollar budget deficits in the future, according to Sen. Mario Scavello (R-40), who voted for the measure.
Senate Bill 1100 now goes to the governor’s desk for enactment into law.
The $45.2 billion budget, which also includes federal American Rescue Plan Act (ARPA) funds, represents a 2.9% increase over the previous year’s spending – and $500 million less than Gov. Tom Wolf’s original budget request.
The budget agreement does not include any broad-based tax increases and is structured in a way to minimize the risk of tax increases in the years ahead.
In fact, the budget actually cuts the Corporate Net Income (CNI) tax rate from 9.99% to 8.99% and creates a phased reduction to 4.99% by 2031, moves designed to attract employers and residents to Pennsylvania.
The budget includes legislative language introduced by Scavello to create the Airport Land Development Zone program, providing tax credits to employers that make a significant new investment by expanding operations and creating new jobs.
“While aviation plays a significant role in Pennsylvania’s economy, many airports struggle despite their owning a substantial amount of land and buildings that can be developed into productive economic uses. Although federal restrictions and federal law put airports at a disadvantage from other non-restricted property, more can be done to expand aviation’s economic impact,” Scavello said. “Airport Land Development Zones will incentivize development on vacant land and buildings owned by airports and leased to private businesses.”
Other viable economic initiatives in the Budget and championed by Scavello include provisions to modernize expense deductions for small businesses, allowing small business owners more flexibility and tax planning opportunities, and to provide tax incentives for small businesses to grow and invest in Pennsylvania.
As important as the economic boost provided by this plan is, which will have a projected ending balance of $3.6 billion, the 2022-23 budget includes a $2.1 billion transfer to the Rainy Day Fund, bringing the total balance to nearly $5 billion.
These fiscally responsible steps are critical because many economic indicators are showing a risk of a recession on the horizon. Most recently, Pennsylvania’s Independent Fiscal Office estimated a 60% chance of economic stagnation or a “growth recession” happening, and a 30% chance of a recession.
The budget includes a $525 million increase for Basic Education Funding, $225 million to provide additional support for the state’s 100 poorest school districts, a $100 million increase for Special Education funding, an additional $60 million for Pre-K Counts and $19 million more for Head Start Supplemental Assistance.
It also includes an additional $125 million in Education Improvement Tax Credits to ensure more students can learn in the educational environment that best suits their needs. Higher education receives a funding boost as well.
Increased funding is also dedicated in this year’s budget to ensure our schools are safe and secure: $100 million is appropriated for the Ready to Learn Block Grant program to address school-based mental health; and $100 million in funding is directed to a new General Fund appropriation for School Safety and Security to address physical safety and security at schools.
Building on our efforts last year to help address the serious financial challenges of our nursing homes and long-term care providers, this budget includes $150 million for costs related to nursing home staffing, $250 million in ARPA funding for long-term living programs and $20 million for supplementary payments to personal care homes.
“This is a solid budget that protects taxpayers today as well as in the event of even worsening economic conditions tomorrow,” Scavello said. “It does all of this while increasing funding for schools and other important programs. It’s a responsible spending plan.”
CONTACT: Christine Zubeck email@example.com (717) 787-6123