The start of the budget process for the governor’s fourth budget comes after a budget that was nearly five months late.
On Tuesday, Governor Josh Shapiro gave his fourth budget address. He unveiled a $53.2 billion spending plan for the 2026-2027 fiscal year.
The budget proposal comes in higher than the $50.8 billion that the state expects to bring in during the same period.
The projected revenue for the 2026-2027 fiscal year includes $2 billion in new taxes that is estimated to come from legalizing recreational cannabis and electronic skill games. The two proposals have caused conflict in Harrisburg over the past three years, and no agreement has been reached.
Democrats have supported Shapiro’s efforts to regulate skill games and legalize cannabis for several years, unsuccessfully.
Shapiro’s latest spending plan comes after the current budget was delayed by nearly five months as lawmakers reached a stalemate in Harrisburg during negotiations. Lawmakers struggled to reach an agreement over how much deficit spending Pennsylvania should take on.
The current budget proposal would require dipping into the state’s $7.5 billion rainy day fund. The total of the proposal comes in at over $3 billion more than the current budget of $50.1 billion.
Shapiro’s plan includes increased spending for the Department of Education and the Department of Human Services. The proposal includes $665 million in additional funding for K-12 schools.
The Department of Human Services would receive about $2.7 billion in new funding for health initiatives and higher Medicaid spending.
“I know government can be a productive force for good in people’s lives. I know because I’ve seen it over the past three years. Our kids are getting a better quality education, our workers have more opportunities to chart their own course, our economy is growing and our communities are safer,” Shapiro said during his annual address.
The budget plan includes a 9.4% spending increase for Pennsylvania State Police, amounting to $117 million. Of that increase, $16.2 million would be allocated for additional troopers.
The proposal also raises the state’s minimum wage to $15 per hour, up from $7.25 per hour.
Republican leaders criticized the proposal over the deficit spending. “This is our fourth budget from the governor that spends way too much, a lot more than we are bringing in in revenue. We plan to be as fiscally responsible to the people of Pennsylvania that we are able to be,” said Senate President Pro Tempore Kim Ward.
“We still believe there is something that needs to be done on gaming reform. But I will tell you, I would also like to see the Governor’s words on paper… The governor talks about gaming reform, but we have yet to see a legislative proposal put in front of us,” said Senate Majority Leader Joe Pittman.
