State Senate approves final fiscal year 2020-21 budget

WILKES-BARRE — The Pennsylvania Senate late Friday gave final approval to a supplemental spending bill — completing the state budget for fiscal year 2020-21 — and sent the measure to the governor’s desk.

Passage of Senate Bill 1350 finalizes the state spending plan for the current fiscal year — July 1, 2020 to June 30, 2021 — that was initiated with the enactment of a five-month interim budget — Act 1A – House Bill 2387 — on May 29.

Sen. Lisa Baker, R-Lehman Township, said overcoming the severe impact of the COVID-19 pandemic on Pennsylvania’s economy, the final $35.5 billion FY 2020-21 budget is balanced without the need for tax or fee increases or debt using a combination of current state revenues and resources and federal stimulus funding.

“This state budget is a product of necessity and responsibility, as well as recognition of the unfortunate economic hardships inflicted by the pandemic on families, workers, and employers,” Baker said. “Given all the economic dislocation striking communities across the commonwealth, and the resultant revenue shortfalls, we are fortunate to finalize a budget without raising taxes or driving up state debt.”

The interim budget passed in May accounted for 5 months spending in the current Fiscal Year due to the uncertainty of the COVID-19 pandemic. The interim budget did, however, fund all education-related line items, including higher education, at 100% of the current FY 2019-20 enacted levels for the full 12 months.

“State finances have improved over the grim projections from May,” Baker said. “Being able to keep the budget on a steady track for the remaining seven months of the fiscal year is crucial, as we continue to pour resources and energy into battling the pandemic. More than anything, there is relief because the situation could have been much worse.”

The Associated Press reported that a coronavirus outbreak in the House of Representatives caused hours of delay Friday before the main spending bill passed the chamber, 104-97, and the Senate, 31-18.

The AP story said most Democrats opposed it, reflecting unhappiness with using federal coronavirus relief aid to underwrite state government costs, rather than provide hazard pay to front-line workers and to aid universities, hospitals, restaurants and businesses and institutions suffering during the pandemic.

“We should take no pleasure in MacGyvering a state budget by stealing funds that were meant for coronavirus relief,” state Sen. Tim Kearney, D-Delaware, told the AP.

State Sen. John Blake, D-Archbald, warned that using more than $4 billion in one-time cash to balance the budget will make the next budget more difficult when the current fiscal year ends June 30.

All told, the package authorizes roughly $11 billion in new spending — the higher spending is driven primarily by medical care for the poor, elderly and disabled.

“We must acknowledge that federal stimulus funding helped us balance the books,” Baker said. “If a long discussed second stimulus package is not forthcoming to help deal with coronavirus-imposed costs, next year’s budget will be even more difficult to balance than anticipated.

“This is not a time to expand the reach of state government through new spending and programs, nor is it a time to contract state effort by attacking existing services and institutions.”

Sen. John Yudichak, I-Swoyersville, said, “In a difficult and challenging year for every Pennsylvanian, the state legislature has delivered a budget that is balanced, sustains the school property tax relief program with a $200 million investment, and includes no additional tax or fee burdens on the taxpayers.”

Yudichak said recovering from the billions of dollars in revenue losses due to the COVID-19 pandemic was a monumental task that required more than $700 million in spending cuts and the deployment of over $3 billion in federal stimulus funds to ensure Pennsylvania could maintain critical investments in education, health care, infrastructure, and job creation.

Blake said the COVID-19 pandemic has wreaked havoc on the state’s economy, schools, the business community, county and municipal governments, and on families and citizens.

“And instead of utilizing federal CARES funds as they were intended, this budget uses $1.3 billion of those emergency funds to fill our budget deficit and it defers real obligations to next year,” Blake said. “CARES funding should have been utilized to relieve some of the pain inflicted by COVID-19 and to compensate our front-line workers; assist our hospitality industry — bars, restaurants, social clubs and veterans’ organizations — as well as other small businesses. We could have relieved some of the stress on our people while pushing forward the costs of this pandemic by doing some responsible borrowing given that interest rates are extraordinarily low.”