$45.3 billion state budget passed for 2022-23 with record education and health spending


State Budget

The General Assembly has passed a Fiscal Year 2022-23 budget of $45.3 billion, an increase of $1.3 billion, or 3%, from last year’s budget when supplemental spending and federal stimulus spending are included. This year’s budget transfers $2.1 billion to the Commonwealth’s Rainy Day Fund, bringing the balance in the fund to nearly $5 billion. Using the Independent Fiscal Office’s (IFO) revenue estimates, Senate and House Republicans project the FY 2022-23 budget will have an ending balance of $3.6 billion.

The bill also spends just under $2.5 billion in federal dollars while funding an increase of $850 million, a record level of education spending, cutting the corporate income tax, shoring up the state Rainy Day Fund, offering a child care tax credit, offering a one-time boost in the property tax/rent rebate for seniors and devoting $100 million targeted at closing cracks in the mental health system in order to try to prevent mass shootings.

A week late

The budget comes a week after it was officially due, but well before the missed deadline interfered with any spending.

House GOP leaders announced that they were prepared to begin moving the budget bills just before 2:30 p.m., hours after officials in the Senate had warned that last-minute negotiations had suggested that a final deal was in jeopardy over disagreements on school spending..

The Senate then said “the path could be corrected today pending the governor’s engagement.” Apparently it was, as the Senate Rules Committee moved SB 1100 out for full consideration at 11:45 pm Thursday night and passed the bill on Friday morning.

Provisions in the bill

Senate Bill 1100 was approved by the House by a 180-20 vote and passed the Senate 47-3.

The budget would increase the basic education subsidy by $525 million to a total of $7 billion for school districts and double funding to $225 million for a Level Up Initiative targeted to help the 100 poorest districts, according to the House Majority Appropriations Committee.

It provides $100 million for school districts through the existing School Safety and Security Program (SSAP) established several years ago.

Another $100 million would be distributed for school mental health initiatives through this program.

The budget provides $405 million, a $125 million or 45 percent increase, for the state Educational Improvement Tax Credit where businesses receive tax credits for donations in return for donations to schools.

Other spending includes an additional $100 million for special education, $60 million more for Pre-K Counts, $19 million more for Head State Supplemental Assistance and $6 million more for career and technical schools.

Stan Saylor, R-York, the chairman of the House Appropriations Committee told reporters, said he believes Pennsylvania may be the first state in the nation to launch a coordinated effort to identify and address shortcomings in the mental health system to prevent violent crime.

“We're putting $100 million into mental health and for the schools, but more importantly, many of you as newscasters and reporters have talked about it all day. You've talked about what just happened in Highland Park in Chicago, the speaker and leader are creating a blue ribbon commission, with the Senate to investigate how we can keep those things from happening here by reserving $100 million that will be put into mental health, hopefully to seal those cracks.”

Rep. Matt Bradford, D-Montgomery, the Democratic chair of the House Appropriations Committee, said that since Republicans hold the majority in both chambers of the Legislature “passing meaningful” changes to the state’s gun laws is unlikely.  “Elections have consequences,” he said.

The move to boost spending on mental health is the alternate approach to trying to deal with the crisis of violence.  Bradford added though that the budget overall is “the right balance.”

I note that the budget also provides $429,000 to upgrade the Department of State’s lobbying disclosure website.

Health related spending

A copy of the line item spending for the Departments of Health and Human Services is attached.

Funding for the Primary Health Care Practitioner program increases by $2.5 million, to $7.05 million.  And the Governor’s proposed cut to MA funding for Academic Medical Centers was reinstated to 100% of last year’s spending at $24.682 million.

Funding for disease-related programs generally increases by 6% as follows:

o Adult Cystic Fibrosis and Other Respiratory Diseases ($45,000);

o Cooley’s Anemia ($6,000);

o Hemophilia ($58,000);

o Lupus ($6,000);

o Sickle Cell ($75,000);

o Lyme Disease ($180,000);

o Regional Poison Control Centers ($42,000);

o Trauma Prevention ($28,000);

o Epilepsy Support Services ($33,000);

o Tourette Syndrome ($9,000);

o ALS ($651,000), an increase of 77%;

o Leukemia and Lymphoma ($12,000); and

o Renal Dialysis ($378,000).


The budget also allocates $250 million in federal (COVID) relief funds to help long-term care providers, including nursing homes, assisted living facilities, personal care homes and home and community-based services,” he said in a statement. “It further supports nursing homes by including $294 million to provide for a $35 day increase in the Medicaid reimbursement rates effective in January.

The budget includes a $4.2 million increase to the Local Health Departments program to increase the per capita amount of funding to $6 or 50% of local health department costs, whichever is less.

The FY 2022-23 budget also includes nearly $23 million to satisfy CHIP arrearages that had accrued during the pandemic when the Administration told insurers they could not terminate CHIP enrollees for not paying their premiums.

Code Bills

Human Services Code

HB 1420 was to be the Human Services Code. This bill includes a program to adopt minimum payment rates for skilled care in the MA program and sets up a separate Nursing Facility Quality Improvement Fund.  It also provides for the Auditor General to audit and review Pharmacy Benefits Managers providing services to MA managed care organizations.  And it provides for qualifying factors to receive innovative health care delivery funds for outpatient emergency departments.

It  requires DHS to establish a public awareness campaign highlighting programs and services available to first responders, health care workers, other frontline workers, and their families experiencing mental health issues related to the COVID‐19 pandemic.

The Governor immediately vetoed HB 1420, as he had promised, because it prevents implementation of the agency of choice initiative for personal assistance services for the Office of Long Term Living for older adults and people with disabilities.  The Governor had said he would veto the bill if this was not stripped out.

In a new twist for budget seasons in PA, the Senate took the language that was in HB 1420, with the exception of the agency of choice initiative, and amended it into the Fiscal Code bill.

Fiscal Code

The Fiscal Code changes are incorporated in HB 1421.  This bill directs $2.1 billion be transferred to the Rainy Day Fund.  And it directs spending $45 million for an election integrity restricted account, to replace private funding to county boards of elections.  The Fiscal Code bill also directs transfer of cigarette taxes for debt service payments, prevention and cessation programs, health related research, and other health-related purposes.  Funds are also authorized for Home and Community Based Services for individuals with disabilities, and child-care services.

Tax Code

The budget deal includes the first cut to the Corporate Net Income Tax in 27 years, when it was reduced from 11.5% to 9.99%.  As part of the bipartisan deal, the state’s CNIT would be cut from 9.99% to 8.99% in 2022, with an additional 0.5% reduction each year until the tax rate reaches 4.99%.  It creates a new program to provide taxpayers with a credit for employment-related expenses which includes childcare and household services for dependents under the age of 13.  The changes are included in HB 1342.

Constitutional Amendments Legislation

During the flurry of bill passages that accompany budget week, the Senate, at 11:45 pm Thursday night, amended and moved SB 106, which has become a vehicle for several proposed constitutional amendments.  If passed by the House, and passed again early in 2023, these five amendments could be on the primary election ballot as early as next spring.


Among the provisions included are:

  • The state constitution does not grant the right to taxpayer-funded abortion or any other right relating to abortion.
  • Exempting disapproval of regulations, termination or extension of a disaster emergency declaration, portion of an emergency disaster declaration and adjournment from the two-thirds vote of both Houses as prescribed in case of a veto of a bill.
  • Requiring that the Lieutenant Governor be voted for jointly with the Governor as part of a ticket, with each candidate for Governor nominating his or her candidate after the primary, as the General Assembly prescribes by law. It limits the Lt. Governor’s role in tie breaking in the Senate to a tie on any question except passage of a bill or joint resolution, adoption of a conference report or concurrence in amendments made by the House.
  • Revises qualifications of voters, that every citizen 21 years of age is entitled to vote in all elections, if qualified as below, subject to such laws as the General Assembly may enact:
    • A citizen of the US for at least one month.
    • Resided in the state 90 days immediately preceding the election.
    • Resided in the election district at least 60 days immediately preceding the election.
      • In addition to the qualifications above, a qualified elector shall provide a valid identification at each election, when voting in person, before receiving a ballot to vote, and when not voting in person, provide proof of a valid identification with his or her ballot.
      • If a qualified elector does not possess a valid identification, he or she shall upon request and confirmation of identity, be furnished with a government-issued identification at no cost.
    • Requires that the General Assembly shall, by law, provide for the auditing of elections and election results by the Auditor General. In years when the Auditor General stands for election to any office, an Independent Auditor shall conduct the audit.