State Budget

The PA Chamber advocates for responsible state budgets that make wise investments and set the Commonwealth on a path toward fiscal prosperity. This largely means battling back against excessive mandates and tax increases on the employer community, enabling them to invest, hire and grow.

Revenue Solutions for $32 billion State Budget Remain Elusive

For the third year in a row, Gov. Tom Wolf allowed the state budget to become law without his signature. The 2017-18 state spending plan, which spends $32 billion, went into effect on July 10. While lawmakers and the governor were able to reach consensus on the spend number, there remains disagreement on how to pay for the approximately $700 million spending increase, as well as how they will address the $1.5 billion budget deficit. While the House has favored borrowing, gaming expansion and additional liquor reforms as the best method to close the budget gap; in late July the Senate passed a Tax Code bill that would impose an additional $600 million in taxes on Pennsylvania businesses and residents. The PA Chamber remains staunchly opposed to this legislation, which would include: a new tax on residential and commercial use of natural gas; an increase to residential and commercial electric bills; a higher tax on phone bills; as well as a severance tax on the natural gas industry.

As budget negotiations continue, the PA Chamber is taking the lead on a broad-based coalition effort to defeat onerous tax hikes in this year’s spending plan. We are instead advocating for policies that right-size state government, rein in growing cost-drivers and encourage business investment that will lead to a stronger economic future in Pennsylvania.

Multi-Industry Coalition: Tax Code Bill Would Significantly Increase Energy Taxes, Hurt Pennsylvania’s Competitiveness

Aug 8, 2017 | Tricia Harris

Raising concerns regarding the impact a proposed revenue package would have on the Commonwealth’s overall economy and competitive edge, a coalition of business leaders representing a wide variety of industry sectors across the Commonwealth today held a media call to urge the state House to oppose H.B. 542 – the Tax Code bill. The legislation – which narrowly passed the Senate in recent weeks – would increase taxes on Pennsylvania job creators and residents by $600 million annually. The proposal includes a number of tax increases that will significantly raise energy costs for both residential and commercial users – including a new gross receipts tax on natural gas users, an increase to the gross receipts tax on electric users and a severance tax on natural gas.

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PA Chamber: Wolf/Senate Revenue Package Bad for Pennsylvania’s Economic Climate

Jul 27, 2017

Pennsylvania Chamber of Business and Industry President and CEO Gene Barr issued the following statement in regard to the Senate’s passage of a revenue package for the 2017-18 Fiscal Year. House Bill 542 – which includes a number of tax increases on Pennsylvania residents and business owners – will have far-reaching, negative impacts on the state’s economic climate and competitive edge.

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Innovation, Economic Trends and Crisis Management Focus of 5th Annual Economic Forecast Summit

Mar 2, 2017 | Tricia Harris

With the Commonwealth’s economy predicted to remain in a slow-growth pattern going into the next fiscal year, leaders from Pennsylvania’s business and banking communities gathered today at the 5th Annual Economic Forecast Summit to gain insight about upcoming economic trends at the state and national level. This annual event – which is presented by the PA Chamber Education Foundation and the Pennsylvania Bankers Association – brings together some of the nation’s most respected economic forecasters and leadership experts.

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PA Chamber: While Efficiencies in Budget Plan Can Be Applauded, Proposed Business Tax Hikes Raise Concerns

Feb 8, 2017 | Tricia Harris

Pennsylvania Chamber of Business and Industry President and CEO Gene Barr issued the following statement in regard to Gov. Tom Wolf’s 2017-18 budget address:

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Sixth Annual Economic Forecast Summit

Sheraton Harrisburg-Hershey
Feb 15, 2018 | 8:15 am to 2:15 pm

The Sixth Annual Economic Forecast Summit—every company needs to not only understand today’s financial picture, but have some type of barometer with which to help forecast what may happen on both the national and international economic fronts.  Knowing the trends and probable outcomes helps companies plan for hiring, save for reserves, anticipate new products and services, develop marketing strategies and communicate with customers. 

Within Pennsylvania’s borders are a diverse and vibrant collection of communities where employers set up shop, residents raise families and tourists come to visit. The success of our Commonwealth is directly tied to the strength of its communities and public policy should help communities thrive.

Pennsylvania’s labyrinthine system of local governments is not conducive to strengthening economic competitiveness. The Commonwealth is comprised of 67 counties, 56 cities, 958 boroughs, 1 town (Bloomsburg), 1,547 townships, 500 school districts and 1,961 authorities. Keeping government “close to the people” is certainly an important principle, but too many small governments with diminished capacities, inadequate resources, and limited economic wherewithal do not help advance economic development and job growth within communities. The PA Chamber believes that cooperation among counties and municipalities is part of what is needed to foster more functional and effective local government.

Moreover, the financial wellbeing of many Pennsylvania municipal governments is often harmed by antiquated and unbalanced state laws and regulations, which may necessitate higher costs and inefficient spending. Ultimately, these costs are borne by Pennsylvania residents and businesses, many of whom now live and operate in financially distressed communities. The PA Chamber supports efforts and legislation to help ease the financial burden municipalities face.

Municipal sustainability can be effectuated by:

  • Expanding opportunities for improving delivery and administration of municipal services: eliminate legal barriers and provide assistance to local governments to deliver services in ways that make practical and financial sense for their respective regions; allow and encourage municipalities to enter public-private partnerships; provide tools for local governments to allow for streamlined permitting so that Pennsylvania businesses and those seeking to locate in Pennsylvania can better compete with other states.
  • Encouraging municipal cooperation and consolidation: Streamline the procedures and provide incentives for consolidating local governments; encourage municipalities to collaborate on delivery of services and consideration and implementation of policies and decisions related to land use, permitting, zoning or any process through which businesses must go to locate or expand a facility.
  • Public Pension Reform: The PA Chamber recognizes the financial burden imposed by unsustainable, outmoded retirement plans and supports efforts to mitigate rising costs in the near term and address unfunded liabilities with as limited an impact as possible on taxpayers. This includes allowing local governments to transition employee retirement plans to a defined contribution retirement plan. These plans have become standard in the private sector as the workforce has evolved, including employee demographics and the tendency for individuals to frequently change jobs, and even careers, during their working life. Both the state and local governments should transition from their traditional defined-benefit retirement plans - which can be unpredictable, unaffordable and outdated - to defined-contribution retirement plans. Moreover, as most of the state’s thousands of local retirement plans serve a small number of employees, consolidation of the various disparate plans could serve to modernize the existing system and create economies of scale that save both taxpayers and plan participants significant money.
  • Reforming binding arbitration: Current state law provides for binding arbitration in the event of a contract dispute between police and fire fighters and their municipal employers and in exchange these uniformed public employees are prohibited from going on strike. The PA Chamber believes binding arbitration can be useful and should remain an option available to resolve disputes. However, it is clear the current system does not sufficiently protect the interests of the municipality as adverse decisions rendered through binding arbitration have become more frequent and a significant cause of escalating costs. The PA Chamber supports reforms to make binding arbitration laws fairer for municipalities, and thereby less costly to taxpayers, while ensuring that police and fire fighters’ rights are protected.