Budget Season Kicks Off as House and Senate Return to Session

Both the House and Senate return to Harrisburg for session this week. The legislature and Governor will negotiate on a budget for the upcoming fiscal year, which the state constitution directs must be completed by June 30. Several bills of interest to the business community are expected to be voted on this week.

Before the legislature returned, Gov. Wolf issued his opening bid for the negotiations. Noting state tax revenues are at record levels, with a multi-billion dollar surplus as a result, the Governor made a public push to increase basic education spending and reduce the Corporate Net Income Tax. Republican leaders in the House and Senate caution that using one-time surplus revenues (owing in large part to significant federal aid from coronavirus relief legislation) to book recurring spending programs when the state is rapidly aging is misguided. The Republicans have pointed to a report from an organization headed by former Federal Reserve Chairman Paul Volcker that such an approach puts the state “at risk of encountering a so-called fiscal cliff once the cash runs out.”

In the meantime, the House and Senate are scheduled to move several pieces of legislation this week in committee and on the floor. The House Transportation Committee will hold a vote on H.B. 2398, which authorizes the testing and deployment of highly autonomous vehicles in the state. Pittsburgh has established itself as a tech hub and a leader in this space; this bill would provide for greater regulatory certainty and safety requirements for such technology. The House Finance Committee is also expected to hold a voting meeting, with S.B. 347 (providing for deferral of taxes on like-kind exchanges of property at the state level) and H.B. 1709 (providing relief for shareholders and owners of pass-throughs facing limits on state and local income tax deductions) on the agenda.

The Senate Environmental Resources and Energy Committee is also expected to hold a voting meeting this week, with H.B. 2075 on the agenda. This legislation eliminates a mandate to adopt onerous and expensive emissions rules from California for tractor trailers and heavy commercial vehicles.


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