By: Senator Tracy Pennycuick
I’m pleased to report that after many months of intense meetings; we were able to negotiate a more reasonable spending plan with important policy improvements with no tax increases on Pennsylvania families or businesses.
The FY 2025-2026 state budget places Pennsylvania on a stronger economic footing and positions the Commonwealth for growth and success in the years to come.
The good news: we were able to cut $1.4 billion from Governor Shapiro’s proposal and use unspent money from numerous state agencies, saving $3 billion dollars. These decisions helped keep the budget balanced without dipping into the rainy-day fund. We simply could not afford the Governor’s proposal and unlike the federal government, the state must balance its budget.
Did we get everything we wanted? No, that’s how divided government works. However, there are some real wins in this budget that I wanted to share with Pennsylvanians.
Our plan includes a new Working Pennsylvanians Tax Credit, a state-level Earned Income Tax Credit that will return $193 million to low- and moderate-income working families in its first year—an immediate boost at a time when many households are feeling squeezed. This tax credit will be available in 2026.
The budget protects programs designed to benefit older Pennsylvanians by providing a $100 million transfer to the Lottery Fund, as well as $90 million in recurring funding from i-gaming. Pennsylvania’s 52 Area Agencies on Aging will receive a $10 million increase to expand access to meals, transportation, social programs, and other essential community-based services. Direct Care Workers who support seniors and adults with physical disabilities will benefit from a $21 million investment designed to raise wages in a field that has long struggled with retention. In addition, Human Services spending was restructured to better align with long-term fiscal realities, a move intended to stabilize critical programs for years to come.
To protect thousands of Pennsylvania seniors from losing access to life-sustaining prescription medications we passed legislation to extend the practice of excluding Social Security cost-of-living adjustments when calculating income eligibility for the PACE and PACENET programs. The exclusion, currently set to expire at the end of 2025, will be extended through Dec. 31, 2027, when the bill is signed by the governor.
We voted to increase funding for our kids’ schools while improving accountability by requiring them to adopt evidence-based reading instruction.
Additional funding is included for the Ready to Learn Block Grant program ($562 million increase), Basic Education ($105 million increase), Special Education ($40 million increase) and Pre-K Counts ($9.5 million increase).
We’ve expanded the very successful education improvement tax credit program with an additional $50 million for the. This funding will be targeted to families in economically disadvantaged schools for students to learn in an environment that best suits their needs.
To help address the workforce crisis in the childcare and early childhood sectors, a new program for Child Care Recruitment and Retention was created. Funded at $25 million in recurring funds, the initiative will provide a direct payment of at least $450 to each child care teacher and para-professional who works in a childcare program that services children in the subsidized Child Care Works program. With this investment, Pennsylvania is joining 18 other states that are directly investing in recruitment and retention efforts in the early care and education sector. This is good news for teachers, parents, and kids.
The budget also increases funding for higher education workforce development programs by 5 percent, restores $15 million in workforce development funding that was cut by Governor Shapiro’s budget, boosts grants to students by 5 percent, and increases funding for student teacher stipends by an additional $10 million.
An additional $7.5 million will support the Grow PA Scholarship Grant program created by Senate Republicans last year to provide grants of up to $5,000 to students pursuing higher education for in-demand fields, provided they agree to stay and work in Pennsylvania after graduation.
I was proud to lead cyber school reform efforts to get tough on truancy and residency requirements and return $178 million to brick and mortar schools.
As a strong proponent of giving families options in educating their children, I value the educational opportunities provided by cyber charter schools. Unfortunately, we have found that in some cases, kids are not showing up for online class and there is no accountability on behalf of the school. For kids to learn they’ve got to be in class – virtual or in-person. The new law helps schools work with families to ensure no student falls behind.
It also improves the residency verification process within Pennsylvania’s cyber charter school system. As the number of students enrolled in cyber charters continues to grow, the residency of these students is verified on a continuing basis.
As your state Senator, I remain committed to holding the line on taxes on families and businesses while ensuring important educational, health and safety programs are funded and effective. If you have questions about items in the budget, please don’t hesitate to reach out to my office.
Senator Pennycuick represents the 24th District which includes Berks and Montgomery counties and is a member of the Senate Appropriations Committee.
CONTACT: Lidia Di Fiore (215) 541-2388