By Peter N. Calcara, PICPA Vice President – Government Relations

The Pennsylvania House and Senate appropriations committees have been busy since early March with hearings on Gov. Josh Shapiro’s first budget proposal. During this work, the General Assembly recessed. Now, both chambers will be back in session on April 24 to begin the give and take of constructing a final budget before the June 30 deadline.

Shapiro presented his $44.4 billion spending plan on March 7 to a joint session of the General Assembly. The proposed budget prioritizes public safety, childcare and early childhood learning, education (K-12 and postsecondary), seniors and their needs, mental health, environment, agriculture, and improving the criminal justice system.

The governor told lawmakers at the time, “[The budget plan] strengthens our communities and makes them safer and more just. It protects our environment and invests in public health. And it starts the long process of making our education system more fair so that every child in this commonwealth has a shot.”

Shapiro outlined minor tax law changes and, while not laying out a specific plan to accelerate a reduction in the corporate income tax rate, the governor did express a willingness to discuss options with lawmakers. The proposed budget eliminates the Pennsylvania gross receipts tax and the sales tax on cell phones, and expands the property tax rent rebate program.

During the March and April hearings, the appropriations committees reviewed the governor’s budget plan and met with key department and agency heads to ask questions about programs and spending priorities. While lawmakers gained additional insight into the Shapiro administration’s plans, and there were some points of disagreements over priorities, there were no surprises.  

Agreements and quick work are not expected, particularly in the state House where the Democrats’ control is a razor-thin 101 seats to 100 with two special elections imminent. On May 16, Pennsylvania’s primary election day, control of the House once again in play. The two major parties are expected to split the races, giving Democrats a 102-101 majority, but there is little margin for error. It will be tough for legislation to make its way through the House, and passing a state budget where every vote cast is vital has become even more challenging.

During the March-April recess of the General Assembly, the PICPA government relations team has been meeting with as many of the nearly 50 new members as possible. The PICPA and our State Tax Steering Committee continue to offer thought-leadership in state and local taxation to lawmakers and the Shapiro administration, and the PICPA is working key lawmakers and staff to advance our legislative priorities. With the limited number of legislative days before the June 30 budget deadline, passing legislation this spring and summer will require patience and persistence.

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Statements of fact and opinion are the authors’ responsibility alone and do not imply an opinion on the part of the PICPA's officers or members. The information contained herein does not constitute accounting, legal, or professional advice. For actionable advice, you must engage or consult with a qualified professional.