PA Budget Update

The budget impasse is now beyond 100 days. Negotiations continue between the Governor and Leaders in the House and Senate. However, over the last 100 days, the following has occurred:

  • The House and Senate passed a budget on June 30th that was swiftly vetoed by Governor Wolf
  • On September 25th, the House and Senate passed a stopgap budget which reflected the funding levels of 1/3 of the budget that was vetoed. This effort was an attempt to get funding to school districts, nonprofits, and social service providers who desperately rely upon state funding to operate.
  • On October 7th, the House voted on the Governor’s proposal to increase the personal income tax by .5%, establish a severance tax, and provide property tax relief to eligible families. This proposal was not approved by the House, failing by a vote of 73-127.

Significant budget-related issues continue to wait as well: liquor privatization, pension reform, natural gas severance tax, internet gaming,  medical marijuana legalization, and others. All of these issues are either revenue generating options or reflect significant savings to future budget obligations.

While the overwhelming majority of the elected officials  are supportive of the film tax credit, the program is part of the annual budget process which requires approval of an appropriation of a certain amount that are to be awarded. Without that annual approval, the program, administered through the Department of Community & Economic Development, does not know how many requests can be approved/funded. Regardless of the certainty that the program will be funded again at a minimum of $60million, the Department is not allowed to “spend” money that it may not have. So….the film tax credit program is at the mercy of the budget – yet another “budget hostage” that must wait.

Jim Davis
PaFIA Lobbyist