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Central Bucks Chamber Hosts State of the State Event

PA Chamber Vice President of Government Affairs Alex Halper served as a moderator last Friday at the Central Bucks Chamber of Commerce’s State of the State Address, hosted at Delaware Valley University.

The event kicked off with remarks from Central Bucks Chamber President & CEO Theresa Fera and Delaware Valley University President Dr. Benjamin Rusiloski. The program proceeded with a presentation from PA Department of Community and Economic Development Secretary Rick Siger, who outlined the Shapiro Administration’s priorities and efforts thus far to attract business and economic activity to Pennsylvania. Secretary Siger spoke specifically about southeastern Pennsylvania as a hub for the life sciences industry and strong educational institutions.

Following Secretary Siger’s presentation, Halper took the stage to summarize several of the PA Chamber’s top legislative priorities and illustrate how the PA Chamber works with chamber partners throughout the Commonwealth to advocate on behalf of employers and for an improved business climate.

Halper then introduced members of the Bucks County state legislative delegation – including state Senators Frank Farry and Steve Santarsiero and state Representatives Tim Brennan, Shelby Labs, Brian Munroe, and Perry Warren – and facilitated an engaging discussion that covered a range of topics from tax policy to workforce development to holding lawmakers accountable.

 

York County Economic Summit

Last Thursday, PA Chamber Vice President of Government Affairs Alex Halper participated in a bipartisan economic summit organized by members of the Pennsylvania General Assembly’s York County delegation. Organized as a series of panel discussions, the event hosted officials from several leading industry groups to review state and local economic trends and offer their insights.

Lawmakers present included State Representatives Seth Grove, Joe D’Orsie, Kate Klunk, Dawn Keefer, Wendy Fink, Mike Jones, and Carol Hill-Evans. Staff representatives from the offices of Senators Kristen Phillips-Hill and Mike Regan were also in attendance.

Halper’s panel focused on the legislative and regulatory changes that can be implemented at the state level to positively impact job creation and economic development in Pennsylvania. Other panelists included Tom Palisin, Executive Director of the Manufacturer’s Association and Greg Moreland, State Director for the National Federation of Independent Businesses.

Halper shared the PA Chamber’s comprehensive set of state-level tax and regulatory reforms aimed at fueling economic growth while making Pennsylvania more competitive for business. He mentioned the nearly 40,000 workers who left the Commonwealth for more business-friendly states last year, arguing these reforms will help reverse this trend and attract new investment.

Following the historic bipartisan passage of Act 53 last session, Pennsylvania’s corporate net income tax rate has been reduced from 9.99 percent (the second-highest in the nation) to 8.99 percent at the start of the year, and will continue to drop by 0.5 annually until it reaches 4.99 percent in the year 2031.

Halper identified legislation to accelerate the phasedown of the corporate net income tax rate, as well as a separate proposal to improve the treatment of net operating losses, as key policy priorities that employers want to see lawmakers act on this fall.

He also reaffirmed the PA Chamber’s support for legislation to modernize and streamline the process of applying for and receiving state permits, as well as a suite of proposals to bolster Pennsylvania’s workforce development efforts and address barriers to employment.

“We have a real opportunity with this upcoming fall session to continue making progress on pro-business policies that are going to move our state forward,” Halper told lawmakers. “Pennsylvania needs to become more competitive, and the way we accomplish that is by making it easier and more affordable for companies to do business in the Commonwealth.”

For more information on the PA Chamber’s economic development priorities, please click here

UPS Opens New Harrisburg Regional Hub

PA Chamber President and CEO Luke Bernstein attended the Grand Opening of UPS’ new, state-of-the-art 24/7 East Zone Regional Hub in Harrisburg last Wednesday and presented the company with honors recognizing its substantial investment into Pennsylvania’s economy.

Strategically located within a day’s drive of nearly two-thirds of the major population centers in the United States, UPS’ Harrisburg hub is the fourth-largest hub in the company’s network.

The new 775,000 square-foot facility, now fully operational, employs 1,700 people and is equipped with advanced automation and other innovations that enable it to process more than one million packages per day.

As reported by PennLive:

“Inside the massive facility with high ceilings sits conveyors processing packages, which go through camera tunnels that will scan the packages. That in turn communicates with the system to tell that package where to go, ultimately heading to an individual trailer that will take it to its final destination.”

Pennsylvania Department of Community and Economic Development Secretary Rick Siger also attended and spoke during the event. “The economic impact of this project is massive,” he said. “When this project was first announced a few years ago, it was part of a statewide investment by UPS of about $1.4 billion into their operation.”

Following the event, Bernstein spoke to the board of the Harrisburg Regional Chamber, where he emphasized the important partnerships that bolster pro-business advocacy across the state.

Bernstein recognized Harrisburg Regional Chamber CEO Ryan Unger and his team for their tireless work promoting economic growth in the region and fighting for policies that will strengthen business development in central Pennsylvania.

Bernstein also outlined the PA Chamber’s key legislative priorities for the fall session: tax reform, permitting reform, and workforce development. Together, these initiatives constitute a comprehensive framework for making Pennsylvania a more competitive state for business, which he says is critical to attracting additional investment and jobs into the Commonwealth.

Congressman Glenn “GT” Thompson Delivers Energy Update

Congressman Glenn “GT” Thompson (PA-15) was the featured speaker during a virtual meeting last Tuesday in which he shared new developments in federal energy policy with PA Chamber members and industry stakeholders.

In his update, Congressman Thompson, who chairs the powerful House Agriculture Committee, underscored energy’s significance in shaping the state’s past, present, and future. He referenced the world’s first- and longest- continuously operating commercial oil wells, both of which are in Pennsylvania’s north-central based 15th District.

Pennsylvania’s energy sector supports more than 420,000 jobs and contributes more than $75 billion to the state economy. In addition to its direct economic impact, Thompson also highlighted the importance of reliable, low-cost energy for heating homes, powering businesses, and generating tax revenue.

Congressman Thompson criticized the Biden administration’s energy policies as a major driver of inflation and cited several pieces of legislation he and his colleagues have advanced to reduce costs for American families and advance domestic energy production, including H.R. 1.

“By utilizing the Commonwealth’s resources, we can create jobs and create opportunities in communities that are suffering under these anti-energy policies,” Thompson said. He also spoke about additional measures aimed at reducing bureaucratic hurdles in approving critical energy projects while maintaining key safety and environmental standards.

Congressman Thompson outlined several updates to the National Environmental Policy Act (NEPA) that were recently signed into law as part of the Fiscal Responsibility Act, following negotiations over the federal debt ceiling. Among these reforms, Thompson said, are provisions eliminating burdensome reporting requirements and establishing clearer chains-of-command when multiple federal agencies are involved in the same project.

Thompson’s update also covered topics ranging from hydrogen hubs to rural broadband, emphasizing the need for proactive policies to harness Pennsylvania’s energy resources.

Answering a query from the PA Manufacturer’s Association on the Biden administration’s plans to ban liquid natural gas (LNG) transit by rail, Congressman Thompson voiced concerns about the potential impact such a measure would have on American families, employers, and jobs. He pointed to Congress’ annual appropriations process as a source of leverage against harmful executive branch proposals.

 

Chamber Chats: Fall Session Priorities

Lawmakers return to Harrisburg later this month, and the PA Chamber is excited to continue promoting bipartisan, pro-business solutions we are championing to make Pennsylvania a more competitive state for business.

For the latest edition of Chamber Chats, the PA Chamber’s Lindsay Andrews caught up with our Vice President of Government Affairs, Alex Halper, to discuss the organization’s top policy priorities as his team gears up for start of the fall session. A minimally revised transcript of their conversation is below.

(Click to view video)

 

We have had a good start to 2023 and some of the things that got done in the budget. Can you talk to us a little bit about what was achieved on behalf of business and what we would like to see coming up in the fall?

AH: Yeah, we have made some real progress on getting some of the top Chamber priorities as part of the legislative agenda – the priorities that lawmakers, that the governor are talking about.

Things like improving Pennsylvania’s tax code. We had tremendous progress last session to make Pennsylvania more competitive as it relates to business taxes, but a lot more work to do and we have a real opportunity this year, this session, and this fall to make more progress.

What can you tell us about the specifics of that progress? What would you like to see get done?

AH: Last year, for the first time in decades, Pennsylvania reduced its corporate net income tax rate. And we needed to because we had the second-highest rate in the country.

The problem is, while we did that, other states are making pro-business, pro-growth tax reform as well, and Pennsylvania is just not keeping up. Governor Shapiro, when he was running for office, talked about reducing those tax rates more quickly, and expediting those reductions.

We thought that was a great idea; we supported the governor’s call for expediting the reduction of the corporate tax rate. There is legislation in both the House and Senate to do that, and we are going to keep pushing to get that done.

What about the treatment of net operating losses? What can you tell us about that? I know that has been a long-term goal for the business community.

AH: Pennsylvania unfortunately puts itself at a great disadvantage as it relates to net operating losses. That basically means that for businesses that experience losses – they lose money in a year – they are often able to use those losses to offset profits in a future year. Of course, our goal for all businesses is to make a profit but a lot of times, you might have a startup company where they are investing in capital, into people, and they are losing a lot of money.

The tax code, both at the federal and the state level, allows companies to offset those losses and reinvest in their company. Pennsylvania, though, does not treat those losses nearly as favorably as practically every other state in the country.

We basically impose a tax on startup companies, which is the last thing we want to be doing if our goal is to make Pennsylvania the most competitive state in the country and attract new, innovative businesses.

There is legislation, again, in both the Senate and the House, that would make Pennsylvania at least on par with other states for how it treats these losses. This bill passed unanimously out of the Senate Finance Committee earlier this session, and we are working with lawmakers on both sides of the aisle – with the House and Senate and the Governor’s Office – to keep that legislation advancing and hopefully get it done.

Moving on to workforce development because I know that is huge for us. A good, strong, bipartisan issue and I know that we took the lead in the first-of-its-kind Clean Slate legislation, what is next for that? What is next for workforce development in the fall?

AH: It is a challenging issue. Employers continue to struggle finding people to fill open positions. There are many, many reasons why the labor market is so tight, and that means we need to have many, many solutions to address this challenge.

You mentioned Clean Slate, which is about helping to encourage Pennsylvanians who have a criminal record or are recently incarcerated, trying to encourage them back into the workforce. That needs to continue to be a priority. We are supporting legislation that would build on Clean Slate, which provides for  automatic expungement of certain lower-level, non-violent offenses.

Similar to Clean Slate, there are efforts to reform Pennsylvania’s probation systems, and we have advocated for some employment-specific reforms to probation.

Things like that—there are no silver bullets to solving Pennsylvania’s and the nation’s workforce crisis. But these are some specific solutions that we think will help a lot of Pennsylvanians but also a lot of Pennsylvania employers.

I also know that permitting reform is critical and an important issue for employers wanting to come to the state. What can you tell us about what is being done to streamline our permitting process and attract business and jobs to Pennsylvania?

AH: It simply takes too long, it is too complicated, and there is not enough transparency in the system of applying for and receiving state permits for projects—if you are looking to expand your facility, for example.

Legislation passed the state Senate earlier this year with bipartisan support to improve those systems, create more efficiency and more transparency. Employers want to know how long it is going to take and how and when to make key investments. This is not about cutting corners as it relates to environmental regulations, this is about understanding and having uniformity with the process and transparency.

This legislation is now pending in the state House, we think it would go a long way toward improving permitting in Pennsylvania and again something we are hoping will continue to advance this fall session.

This is something that has the support of business and lawmakers on both sides of the aisle as well as the Shapiro administration.

AH: That is true. One of the first actions that Gov. Shapiro took upon taking office was issuing an executive order to improve permitting in Pennsylvania. Part of this legislation would codify Gov. Shapiro’s executive order so that it exists in Pennsylvania law long after his tenure as governor is completed. We think there are some very good ideas in there and we look forward to continuing to work with a broad coalition to make this happen.

 

For more information on these issues, please visit the On the Hill section of our website.

What’s in the Fiscal Code Bills?

When the Pennsylvania Senate reconvened on Aug. 30, Senators passed two separate fiscal code bills designed to advance the budget process and drive out the approximately $1.1 billion in state funding that still awaits authorization after Gov. Josh Shapiro signed the main state budget earlier that month.

The larger of these two bills, House Bill 1300, designates funding for a wide array of state programs. It authorizes certain fund transfers and directs support for education, healthcare, and emergency services.

House Bill 1300 provides $295 million in Ready-to-Learn Block Grants for school districts across Pennsylvania, which supporters are calling a crucial step toward supporting quality education and empowering innovation at the local level. The bill also designates $261 million in state aid for community colleges, a two percent increase over last year’s funding levels.

Moreover, House Bill 1300 extends $65.4 million in funding to the Pennsylvania State System of Higher Education (PASSHE) for early repayments on existing debt associated with campus buildings at the Penn West trio in California, Clarion, and Edinboro. The bill also ties state aid for PASSHE to a tuition freeze for academic years 2032-24 and 2024-25, aiming to alleviate the financial burden on students and promote access to higher education.

Additional educational allocations include $70 million in state aid for libraries; $14.5 million in funding for career and technical programs; and $11 million in grants for school safety initiatives in non-public schools. The bill also empowers the Pennsylvania Department of Education to direct up to $7 million in undistributed funds toward school districts under financial distress.

House Bill 1300 also makes notable investments in health and public safety. The bill designates $20 million for counties to support mental health services and increases the state trooper complement by around 400 troopers, up to 4,410, to bolster law enforcement capabilities.

Furthermore, the legislation helps ensure fair compensation for first responders by adjusting state reimbursement rates to the greater of Medicare or Medicaid rates. House Bill 1300 also provides certainty to nursing care facilities by requiring the Department of Human Services to base each facility’s case mix rate on the data used to determine rates for Fiscal Year 2022-23.

Other provisions include the redirection of $150 million from the Game Fund, created by oil and gas drilling rent and royalty payments on state game lands, to the Clean Streams Fund. The bill also raises the payment in lieu of taxes which several state agencies make to rural municipalities to $2.40 per acre and transfers $31 million from the Medical Marijuana Program Fund to the General Fund, reallocating resources to support broader state initiatives.

The other bill the Senate passed on Aug. 30, Senate Bill 757, focuses on two majority caucus priorities excluded from Gov. Shapiro’s enacted budget: the creation of the Pennsylvania Award for Student Success (PASS) scholarship program and an expansion of the Educational Investment Tax Credit (EITC).

Several priority issues Democrats raised in budget talks – including $100 million in supplemental funds for the state’s 100 poorest schools, $10 million in stipends for student teachers, $100 million for school mental health services, and $175 million for the Whole-Home Repairs program – received no allocation under either bill. It is likely these programs will remain a focal point when the House returns to session.

Permitting reform critical in cementing PA’s energy leadership

Note: This editorial originally appeared in Broad + Liberty.

World energy markets remain in turmoil as Russia’s horrific invasion of Ukraine invited sanctions and a long-needed rethink of global energy policy. Markets around the world have strongly signaled they are willing to pay a premium for American energy, having seen how Putin has used proceeds from Russian oil and gas to help fuel his invasion.

Pennsylvania is awash with enough energy resources to meet this demand, while keeping prices lower for consumers domestically – we just need the infrastructure to deliver it and the regulatory environment to build.

Our state has huge reserves of natural gas and coal, not to mention decades of knowledge and supply chain in the nuclear, grid management, and renewables spaces. Most importantly, we have a skilled and ready workforce that is ready to get to work to deliver energy safely to homes and businesses and to move it overseas to growing economies that want to trade with free market democracies like the United States.

How will we do it? It will take expanding Pennsylvania’s ability to move gas to market, including through an export facility in the southeastern part of the state. Such a project would mean tens of thousands of man-hours for good-paying jobs in the skilled trades, while helping to grow the economy and providing cleaner, American-made energy to our allies.

A study is currently underway to examine how Pennsylvania could become a leading player in the global energy marketplace by exporting liquid natural gas (LNG). The Philadelphia LNG Export Task Force, a bipartisan coalition comprised of public officials, industry leaders, and building and trades representatives, is conducting a series of hearings to develop a report on the subject, which is expected later this year.

Building an LNG export facility would not only create jobs in the skilled trades; its establishment would also support permanent employment opportunities throughout the entire greater Philadelphia region.

Research demonstrates that every direct job in the natural gas and oil industry generates at least three and a half additional jobs in Pennsylvania. Beyond these workforce opportunities, revenues generated from natural gas exports can also help contribute to the wellbeing of the regional economy.

To make an LNG export terminal a reality, however, we need comprehensive permitting reform.

By one estimate, it takes an average of 4.5 years for energy infrastructure projects to undergo environmental reviews. This process can delay critical projects – like the Mountain Valley Pipeline proposed in Appalachia – and force others to be canceled entirely. When this happens, potential benefits for local economies (like job creation and economic development) go unrealized.

Reforming our state and federal permitting processes is essential for producing and supplying all sources of energy and making progress on emissions reduction.

Legislators on both sides of the aisle in Washington and Harrisburg have recognized that addressing the challenges of fighting climate change while ensuring abundant, affordable energy will only happen when policy promotes innovation and building new projects in the United States. The non-partisan policy think tank Common Good estimates permitting delays on energy projects cost the nation trillions in public health costs, and the Property and Environment Research Center has pointed to slow federal reviews of forest management as a contributor to wildfires plaguing the Mountain West.

The Port of Philadelphia is the most efficient facility of its kind in the nation, and it is a key infrastructure asset to the state’s quality of life and economic climate. Expanding shipments of goods and energy, including through an LNG terminal in southeastern Pennsylvania will be a boon for workers, consumers, businesses, and families, here and abroad.

As bad actors continue to disrupt global energy markets, Pennsylvania can be a leading state among nations in exporting cleaner oil and gas – and in the process, strengthening national security for America and our allies.

Jon Anzur is the Vice President of Public Affairs at the Pennsylvania Chamber of Business and Industry.