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Governor’s budget plan is nothing new

“I love Groundhog Day,” said Gov. Josh Shapiro during the budget address.

Of course, the governor meant the Pennsylvania tradition of Punxsutawney Phil and his prescient shadow. But judging by his proposal, Shapiro could have easily been talking about the 1993 movie of the same name. Like Bill Murray in Groundhog Day, Shapiro seems trapped in a time loop, pushing the same out-of-control spending while failing to deliver his promises.

The governor’s 2025 budget proposal — a whopping $51.5 billion in total — repeats many of the same tax-and-spend strategies from his prior two.

Pennsylvania Gov. Josh Shapiro arrives to deliver his budget address for the 2025-26 fiscal year to a joint session of the state House and Senate at the Capitol is seen, Tuesday, Feb. 4, 2025, in Harrisburg, Pa. (AP Photo/Matt Rourke)

His education plan is more of the same, adding another $824 million to last year’s historic increase to hit $17.7 billion in public school funding. Yet, despite claims of underfunding, the Keystone State already spends more than $22,000 per student, ranking seventh-highest nationally.

Pennsylvania may be in the top ten for educational spending, but it’s far from the top ten academically. The latest National Assessment of Educational Progress, or Nation’s Report Card, results reveal almost 70 percent of Pennsylvania eighth graders cannot read or perform math at grade level. Without any accountability measures, Shapiro’s same-old no-strings-attached education funding increases will do little to reverse these dreadful outcomes.

Moreover, Shapiro’s budget recycles his failed energy policies. Boasting about his new “Lightning Plan,” the governor shared his vision of a legal regime that taxes carbon producers and funnels money to green-energy lobbyists.

But these policies are far from new. The Lightning Plan merely repackages and rebrands Shapiro’s proposals from last year: the Pennsylvania Climate Emissions Reduction Act and the Pennsylvania Reliable Energy Sustainability Standard. Sadly, PACER and PRESS are carbon copies of similar programs: PACER is another cap-and-trade scheme like the Regional Greenhouse Gas Initiative, and PRESS is a more stringent version of Pennsylvania’s Alternative Energy Portfolio Standard.

The one thing his alphabet soup of mandate-and-subsidize programs is highly successful at is raising utility bills. To meet AEPS mandates last year, utility companies shelled out $528 million — an expense passed down the powerline to households and businesses.

To be fair, Shapiro’s budget wasn’t an entire rehash. Indeed, the governor finally introduced a plan to accelerate the reduction of the corporate net income tax. However, he paired it with the poison pill of “combined reporting” and some reworked proposals, such as taxing and regulating skills games and legalized marijuana. However, these policy “innovations” are anything but new. Instead, they rely on the age-old tax-and-spend strategy that got us into this fiscal mess in the first place.

First and foremost, Pennsylvanians deserve the truth about our state’s financial situation. The commonwealth is on a collision course with a budget deficit and — even worse — tax hikes. This week, the Independent Fiscal Office found three years of overspending produced a $3.6 billion structural deficit. In other words, the state spends more than it’s collecting from taxpayers. In his speech, Shapiro dishonestly claimed we have a surplus.

But it is about to get worse. The IFO’s projections reveal that, under Shapiro’s plan, Pennsylvania will exhaust its General Fund balance and illegally drain the Rainy Day Fund by 2027. At this rate, Shapiro’s record-level deficit spending will result in, on average, a $1,870 tax hike on already-struggling Pennsylvanian households.

The last thing hard-working Pennsylvanians need are increased taxes and energy costs. Rather than promote costly new programs or throw more money at old problems, Shapiro and his fellow lawmakers must address run-away spending and how state government is stemming economic growth.

For starters, addressing the state’s structural deficit will safeguard taxpayers from looming tax hikes. Lawmakers must prudently assess special funds and cost drivers, like welfare programs. Also, increasing energy production and streamlining permitting for all industries will allow Pennsylvania to lean into its competitive advantage over other states and cut energy costs for Pennsylvanian households and businesses.

In addition, Pennsylvanians deserve educational choice, no matter their zip code. More than 200,000 students attend Pennsylvania’s low-achieving schools. Most of them have no other option but to attend their local failing public school. Shapiro and his fellow lawmakers must grow existing opportunities (such as the state’s two tax-credit scholarship programs), create new programs (such as Lifeline Scholarships), enact open enrollment (so students can attend schools outside their immediate catchment area), and stop cutting the funding for students who choose cyber charters.

Insanity is doing the same thing over and over and expecting different results. It’s time for Shapiro to stop recreating the plot to Groundhog Day and break this repetitive cycle of overspending and underdelivering. Otherwise, Pennsylvanians will pay a hefty price.

Elizabeth Stelle is the vice president of policy at the Commonwealth Foundation, Pennsylvania’s free-market think tank.

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