Pa. Supplement Appropriations Bill Awaits Wolf’s Signature
Working late into the evening of Friday, Nov. 20, state lawmakers approved a supplemental spending bill for the fiscal year (FY) 2020-2021 that began in July. The final, full budget for the fiscal year is $35.5 billion and is balanced without the need for tax or fee increases or debt using a combination of current state resources and federal stimulus funding. Gov. Tom Wolf is expected to sign the plan into law.
The stop-gap budget signed into law by Wolf in May provided funding for public education and higher education for a full 12 months, while most other state agencies and departments were funded for the five months ending Nov. 30, 2020.
“The action taken in May allowed us time to gain a clearer financial determination of the Commonwealth’s finances in order to more accurately project revenue estimates before developing our final spending plan for the remainder of fiscal year 2020-2021,” noted PICPA member Sen. Pat Browne (R-Lehigh), chair of the Senate Appropriations Committee. “We now have a financial outlook that improved dramatically during those five months, with both the Independent Fiscal Office’s and Department of Revenue’s fall revenue estimate projections improving by nearly $2 billion.”
One bill that did not make it across the finish line is PICPA’s legislation that clarifies the treatment of Paycheck Protection Program (PPP) loan forgiveness under the Pennsylvania personal income tax law. House Bill 2497, sponsored by Rep. George Dunbar (R-Westmoreland), will have to be reintroduced in January and begin the legislative process anew.
Spending in the final FY 2020-2021 state budget includes General Fund appropriations of $32.1 billion and an additional $3.4 billion in federal stimulus funds ($2.1 billion from the Federal Medical Assistance Percentage and $1.3 billion from federal CARES funds). This budget spends $760 million less (2.1%) than FY 2019-2020.
As part of the budget package, lawmakers sent Wolf a fiscal code bill. Among the provisions in House Bill 2536, which also awaits Wolf’s approval, is one that authorizes local government units to issue tax anticipation notes that mature after the end of the fiscal year because of changes to tax filing deadlines as part of the COVID-19 response. Tax anticipation notes issued under this section can have maturity dates no later than the last day of the fiscal year in 2022.
For a more complete picture of the 2020-2021 state budget and a recap of the two-year legislative session, plan to attend PICPA’s Legislative Update webinar on Wed. Dec. 16, at 9:00 a.m.
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Lawmakers Approve COVID-19 Liability Protection Bill
Health care providers, schools, businesses, nonprofits, and others who followed COVID-19 public health directives would be protected from unfair lawsuits for good-faith actions they took during the coronavirus pandemic under legislation sent to Gov. Wolf. The bill was approved largely along party lines in the House (104-98) and the Senate (29-21).
The measure was championed by the Pennsylvania Coalition for Civil Justice Reform, of which the PICPA currently serves a chair.
House Bill 1737, which aims to head off lawsuits that could harm struggling employers and institutions who did their best to follow the changing and sometimes conflicting guidance provided by state and federal governments.
“In ordinary times, closing any door to the courthouse would not be a preferred step for many,” said Sen. Lisa Baker (R-Luzerne), who authored several key components of the legislation that were amended into House Bill 1737. “Given the immense challenges we are confronting, it is hard to see how we could responsibly avoid such an action.”
The measure simply ensures that if people or entities follow public health directives, they will not be held responsible for any harm that allegedly occurred. Health care providers, PPE manufacturers, schools, universities, childcare providers, businesses, nonprofits, and governments would still be responsible for intentionally wrongful or reckless acts.
Liability protection is also offered under the proposal for farmers hosting agritourism events, such as hayrides, farm tours, and corn mazes. These sites must post specific warnings and have a signed, written agreement with visitors that they have acknowledged the risk of participating in a particular activity.
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CPE Carryover Bill Heads to Governor
Retiring state Rep. Harry Readshaw’s (D-Allegheny) legislation to allow carryover of excess continuing education credits is headed to Gov. Wolf for his approval.
House Bill 64 permits boards and commissions under the Bureau of Professional and Occupational Affairs to allow licensees who earn continuing education credits in excess of the amount required for license renewal to carry over the excess credits and apply them to the next biennial renewal period. Credits may only be carried over for one biennial renewal period.
The PICPA anticipates Wolf will sign the bill into law, after which it will take effect in 60 days.
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Broadband Funding Bill a Step Away from Becoming Law
Legislation to help boost broadband access in the state’s most rural communities is now headed to the governor’s desk.
To help expand this vital service, Senate Bill 835 would create the Unserved High-Speed Broadband Funding Program and fund it, in part, by repealing the $5 million Mobile Telecommunications Broadband Investment Tax Credit.
The bill calls for supplementing the $5 million with additional funds to provide grants in support of broadband expansion in areas most in need of these services. The grant program would be administered by the Commonwealth Financing Authority.
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Conventional Oil and Gas Wells Act
A measure addressing the regulation of conventional well drilling activities and the plugging of abandoned wells in Pennsylvania has made it to Gov. Wolf’s desk.
Senate Bill 790, sponsored by Sen. Joe Scarnati (R-Jefferson), establishes the Conventional Oil and Gas Wells Act to provide a framework specific to conventional wells and well sites. Both unconventional and conventional wells are currently permitted activities with the same regulatory requirements under Act 13 of 2012.
Scarnati says Act 13 has harmed conventional wells found in the Marcellus shale because it places additional burdens on the smaller conventional producers. The Wolf administration argues that Senate Bill 790 undermines core environmental protection principles and vows that the governor will veto the legislation.
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Pa. Senate Democrats Select 2021-2022 Leadership Team
Members of the state Senate Democratic Caucus elected their leadership team for the two-year 2021-2022 legislative session that begins in January.
The top three spots will stay the same: Sen. Jay Costa (D-Allegheny) as Democratic leader; Sen. Anthony Hardy Williams (D-Philadelphia) as Democratic whip; and Sen. Vince Hughes (D-Philadelphia), as Democratic chair of the Senate Appropriations Committee minority chair.
Two new faces join the leadership team: Sen. Maria Collett (D-Montgomery) will serve as the Democratic caucus secretary and Sen. Katie Muth (D-Montgomery) is the new chair of the Democratic Policy Committee.
Sen. Wayne Fontana (D-Allegheny) remains Democratic caucus chair.
With Thursday's caucus election announcement, all four caucuses have chosen their new leadership teams
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House Approves Resolution on Nonpartisan Election Audit
The Pennsylvania House approved House Resolution 1100 to require the nonpartisan Legislative Budget and Finance Committee (LBFC) to coordinate a risk-limiting audit of the election. The resolution, sponsored by Rep. Jesse Topper (R-Bedford), allows the LBFC to contract an outside agency to complete the audit.
The bipartisan LBFC was chosen in part because it is made up by an equal number of Republicans and Democrats from the House and Senate. In addition, the committee will continue to operate while the General Assembly’s 2019-2020 session ends at the end of the month, allowing for the audit to proceed uninterrupted. The LBFC audit would not question the results of the 2020 election, but rather scrutinize the process to guarantee integrity in every election.
While the Pennsylvania Department of State conducts its own audit of every election, the LBFC risk-limiting audit would include much larger samples. It would also be required to provide data sets, much like what was done for an audit report on the 2020 primary election.
With House approval, the LBFC will begin the process of conducting the audit.
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Pa. L&I Expands Window to Backdate UC Claims
The Pennsylvania Department of Labor & Industry (L&I) temporarily expanded its ability to backdate unemployment compensation (UC) claims from six weeks to up to 52 weeks.
The change is intended to allow L&I staff to assist claimants who attempted to file UC claims during the first weeks of the pandemic but needed assistance and were unable to reach a staff member due to the sudden surge in claims. According to L&I, the temporary change will simplify the process for backdating and allow for more approvals at a faster pace.
Claimants seeking to file a backdated claim should email email@example.com with the subject line “Back Date Request.” The email should include the exact date they were separated from their employer and any relevant information about the separation for the additional weeks the claimant wishes to claim.
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State Treasury Releases COVID-19 Debt Cost Reduction Review
The Pennsylvania Treasury Department released a comprehensive report providing an overview of debt utilization in the state as well as a general assessment of Pennsylvania’s fiscal condition. The COVID-19 Debt Cost Reduction Review represents a full scope of debt held by commonwealth authorities and related entities.
The Act 37 of 2020 gave Treasury the tasks of providing an analysis of the debt obligations of commonwealth authorities and related entities and identifying refinancing opportunities that may provide savings.
The report makes several policy recommendations including a commitment to a long-term plan for strengthening the commonwealth’s Rainy Day Fund and requiring a biennial study that compares Pennsylvania’s overall liabilities to other states. These changes are specifically designed to improve Pennsylvania’s ability to address inevitable economic downturns and increase the likelihood of a credit rating enhancement, which would reduce borrowing costs.
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