What’s In It for You – Budget Review

With only minutes to spare Saturday night, Gov. Corbett signed his second on-time budget without increasing taxes and limiting spending growth to less than inflation and population growth. Here’s what you need to know about the 2012-13 fiscal year budget:


  • Lawmakers created a lifeline for kids in failing and violent schools through a new $50 million opportunity scholarship program under the Educational Improvement Tax Credit and expanded the traditional EITC by $25 million to $100 million. This was the single largest expansion of school choice in more than a decade.
  • The legislature passed meaningful corrections reform via Senate Bill 100 that will save taxpayers millions in costs in coming years while increasing public safety. But…see Things Left Undone.
  • A block grant pilot program will give 20 counties the flexibility from state rules to fund welfare programs according to the unique needs of their residents.
  • Lawmakers continued to phase out the Capitol Stock and Franchise tax, saving job creators hundreds of millions of dollars.

Things Left Undone

  • While Senate Bill 100 heads to the governor’s desk, a separate component, House Bill 135, needs to accompany it. HB 135 is the arrowhead that will ensure Pennsylvania hits the target of improving public safety while saving tax dollars. 
  • Cyber school reform designed to streamline the process for creating and funding a charter school failed when House and Senate members were unable to reach a consensus.
  • The budget continues various corporate welfare programs instead of eliminating all of the tax breaks and handouts for “job creation” to allow for across-the-board tax rate reductions that would benefit all Pennsylvanians. 
  • Pennsylvania’s Four Alarm fiscal fire remains a threat to our prosperity. The budget spends more than expected revenues next year, while future costs for pensions and debt continue to grow.

Finally, this budget does little to address the powerful Union Party responsible for derailing a more robust voucher program, cost-saving prevailing wage reforms and liquor liberty. Until Pennsylvania addresses these underlying cost drivers fueled by special interests, lawmakers will be hard pressed to put the Keystone State on a sustainable path to prosperity.