Harrisburg Finally Has a Budget Deal

Gov. Tom Wolf and Republican legislative leaders say they have finally cut a tentative budget deal, reports NewsWorks’ Kevin McCorry. It includes a historic increase in education funding, which is a major victory for Wolf. He promised to secure more money for the state’s schools during his gubernatorial campaign. Via McCorry:

The tentative pact includes what would be the largest increase in state education spending in at least two decades.

The basic education subsidy would see a $350 million increase, special-education and pre-K funding would each receive a $50 million boost, in addition to $10 million more for Head Start.

It’s not clear yet how much of that money would go to the School District of Philadelphia.

So what are Republicans getting from Wolf in return for supporting his top priority? Some pension and liquor reform, of course. Political insiders have long speculated that GOP lawmakers would only sign off on a sizable boost in education funding if Democrats agreed in turn to overhaul the state’s liquor system and pension fund.

The pension system for future state workers, including teachers, would be modified as a hybrid of a defined benefit and a defined contribution plan — placing a share of the market risk on future individual employees, while removing some from the state and local school boards.

The tentative pact also includes a compromise that would allow wine to be sold in supermarkets and restaurants.

In order to finance the plan, lawmakers would broaden the sales tax, according to NewsWorks. The tax would apply to more items and some exemptions would be eliminated. However, the sales tax rate would not go up. Neither would the personal income tax rate, and there would be no tax on Marcellus Shale drilling, which was a key component of Wolf’s proposed budget plan.

A word of caution: Wolf and Republicans said earlier this year that they reached a tentative agreement on key parts of the budget, only to have it fall through. But maybe this one will stick. After all, the swanky Pennsylvania Society gala — the political event of the year to see and be seen — is next weekend.