Governor Josh Shapiro made his first major speech before a joint session of the PA General Assembly this week outlining his $44 billion budget plan for the Commonwealth. While the annual event is one where the sitting Governor formally introduces the state’s financial plan, it typically serves to hear what legislative and policy initiatives will develop in the weeks and months ahead. This year, however, was the first significant opportunity for Shapiro to lay out his policy vision for the state since taking office in January.

Overall, the budget included a lot of initiatives that would be agreeable to both sides of the political aisle. However, many initiatives will be heavy lifts in a divided legislature. While highway and infrastructure funding wasn’t a core theme of Shapiro’s proposal, it may garner bipartisan support.

The Governor outlined a new approach to funding the State Police, which will have a secondary effect of adding additional dollars to the state’s Motor License Fund (MLF)—the lifeblood of how the highway construction industry is funded. Specifically, the budget calls for a new Public Safety and Protection Fund (the PSP Fund) designed to end the decades-long transfer of MLF dollars for State Police operations. Today, that number is slated to be $500 million. Shapiro is calling for this new fund to be an exclusive and dedicated way to fund the State Police in the future. As a result, he’s proposing decreasing the amount transferred from the MLF to the State Police by $100 million per year for the next five years. The new PSP Fund would receive other direct revenues and no more MLF monies or fuel taxes after this five-year period.

Other non-transportation budget items of note were:

  •  A $567.4 million increase (7.8%) for basic education funding and another $103.8 million for special education funding;
  • A new $16.4 million public safety initiative resulting in the hiring and training of 384 additional State Police Troopers;
  • An additional $24.7 million for job retention and recruitment efforts to address workforce shortages;
  • Adoption of the GOP plan to allocate $23.8 million in workforce training and apprenticeship programs;
  • A new $2,500 tax credit for those who earn a license or certification in nursing, law enforcement, or education/teaching;
  • A massive expansion of the Property Tax and Rent Rebate Program, raising the maximum for seniors from $650 to $1,000 and also raising the income qualification threshold to $45,000 per year;
  • A call to increase the state minimum wage to $15 per hour;
  • Continue to decrease the corporate net income tax rate to 8.49% in 2024, continuing the downward path to 4.99%.

It is important to note that not all these provisions may pass in the final budget in late June. It will be imperative for members of the highway construction industry to be active advocates, especially to achieve success in freeing up additional highway dollars by reducing the amount going to the State Police. Please consider joining our APC Advocacy Team and join the fight to help make this happen! Go here to join the team.