The Pennsylvania Budget: A Breakdown

Lawmakers in Harrisburg have worked out a budget that calls for spending $40.8 billion for the 2021-22 fiscal year. Total spending is up 2.6%. This budget is the first Pennsylvania state budget that has reached $40 billion.

The budget includes about $1.1 billion of the nearly $7.3 billion in American Rescue Plan funds that PA received this spring. Republicans in Harrisburg had been wary of spending these funds all at once; instead, they decided to put $2.52 billion to the state’s rainy day fund and the rest to spend in upcoming budgets. States have until 2024 to spend their American Rescue Plans. The budget passed the statehouse 140-61, and the Senate approved it by 43-7 votes. Governor Wolf has indicated that he will sign the budget this week. The two largest increases in the budget were in human services and education. 

Overall, many Democrats felt this was a missed opportunity to spend the American Rescue Plan funding while Republicans praised the budget as fiscally responsible. 

Education Funding: 

Education will receive an increase of $300 million for primary education, with $100 million of that targeted to the 100 historically underfunded school districts. Additionally, special education would receive a $50 million increase, boosting that budget line to $1.24 billion, while preschool and Head Start programs will receive a $30 million increase, to $311.5 million. In February, Governor Wolf proposed spending an additional $1.35 billion to help school districts. Although the budget fell short of Governors Wolf’s initial school funding ask, the Governor indicated that he was satisfied with the increase. 

The Educational Improvement Tax Credit (EITC) program will also receive an additional $40 million. 

Most PA’s higher education institutions will have level funding, but community colleges will see a $1.3 million increase. 

Human Services and Nursing Homes: 

Human service funding increased due in part to account for the growth of Medicaid during the pandemic and to fully account for budget costs that were only partially funded last year. 

Nursing homes, assisted living, and personal care homes will receive $282 million in federal relief funds. Additionally, there is funding to provide services to 832 people with intellectual disabilities who are currently on waiting lists to receive services. 

Additional spending to be covered by the American Rescue Plan funding: 

• $30 million for violence intervention and prevention grants from the federal fundings; 

• $5 million in federal funds is headed to the Emergency Medical Services Operating Fund to support the first responders;

• $279 million for road and bridge projects;

• $3 million to support state food banks and soup kitchens.