Legislature Sends $25B Budget, Virus Aid Bill To Wolf

May 29, 2020

A piecemeal, no-new-taxes $25.8 billion budget headed to Gov. Tom Wolf's desk Thursday, as did legislation to distribute about $2.6 billion in emergency federal coronavirus aid to counties, nursing homes and wide range of other causes.

Both won speedy approval in the Republican-controlled Legislature.

The budget measure was unveiled Tuesday and the plan to distribute federal coronavirus aid Thursday morning. The main appropriations bill in the budget was approved 44-6 in the Senate on Thursday, while the legislation to distribute emergency federal aid was unanimous.

Wolf, a Democrat, was expected to sign both.

The budget package carries full-year money for many public school budget lines, as well as for state-supported universities, debt service and school pension obligations. But it funds much of the rest of the state’s operating budget lines, including billions for social services, only through Nov. 30, the last day of the two-year legislative session.

Wolf and other budgetmakers say that will give them time to see how badly coronavirus-related shutdowns damage tax collections and whether the federal government sends another aid package to states.

If the federal government doesn't come through, the shortened timeline sets up a post-election budget fight in November. Some budget analysts projecting a $6 billion shortfall through next July 1, with the rising cost of health care and an aging population exerting heavy pressure on Pennsylvania's finances.

Budget makers also point to as much as $2 billion in tax collections, if not more, that will not arrive in state coffers until after the July 1 start of the fiscal year because of tax deadlines that were delayed amid the pandemic-related shutdowns.

Meanwhile, the legislation to distribute about $2.6 billion in emergency federal coronavirus aid will leave the state with about $1.3 billion for future needs.

Sen. Vincent Hughes, D-Philadelphia, called the legislation “a thoughtful package that will get help out to millions of people in Pennsylvania.”

Almost $700 million will go to nursing homes and long-term living programs for older adults, while $625 million will go to counties that did not already get direct aid from the federal government.

The grants to counties will be distributed by population, rather than by how hard the county was hit by the coronavirus.

So, for instance, York County, home to 970 confirmed cases, will get more than $40 million, while Berks County, home to about 4,000 confirmed cases, will get $38 million and Lehigh County, with more than 3,700 confirmed cases, will get about $33 million.

Meanwhile, Westmoreland County, with just 443 cases, would get $31.5 million, well over what Luzerne and Northampton counties will get, despite the fact that those two counties had at least six times the number of confirmed cases.

Counties can send money to municipalities, use it to cover costs to respond to the coronavirus, put it toward behavioral health programs or give it out to nonprofit entities and small businesses.

Philadelphia and the state's six other most populous counties received a total of $1 billion directly from the federal government.

An aide to House Appropriations Chairman Stan Saylor, R-York, said distributing money by population to counties, rather than by coronavirus caseload, follows federal precedent in Congress' emergency aid legislation. Besides, preparation for the coronavirus was the same in many ways even in places that were not hard hit, said the aide, John O'Brien.

The way Congress pumped out direct federal aid meant that Pennsylvania, along with other hard-hit states, got comparatively little when measured by the number of positive coronavirus tests, while states that saw far fewer cases took in an outsized share of the $150 billion.

The legislation on Wolf's desk also creates a $225 million pot of grants to help small businesses hurt the most in the coronavirus shutdowns. However, it thus far lacks legislation that provides a distribution plan or guidelines.

Another $150 million will go for rental assistance of $750 per month for up to six months, available through the Pennsylvania Housing Finance Agency. Assistance is contingent on the renter losing their job after March 1, or seeing their income drop by at least 30% due to the pandemic.

Yet another $150 million will go to school districts to cover the costs of cleaning, equipment and social-distancing measures related to the pandemic, as well as to buy equipment for distance learning.

Each district would receive at least $120,000, plus a proportional amount based on its student population.