The 2011-2012 Pennsylvania State Budget

General Fund Spending: $27.148 billion

This level of spending represents a 4.1% spending reduction from the 2010-11 state budget ($1.17 billion less).  This is only the third time in 40 years that Pennsylvania will be spending less than the prior year.  
  • This budget is a responsible, on-time, pay-as-you-go budget with no new taxes and no new borrowing – ending the trend of spending money we don’t have.
  • Streamlining state government, the General Fund Budget eliminates nearly 100 line-items, eliminating wasteful, non-essential and duplicative programs.
  • This budget is WAM-free. The General Fund Budget contains no lines that have been considered so-called WAMs – grants directed in a non-competitive or formula-driven manner.
No Tax Increases

Because this economy is already rough enough on the paychecks that Pennsylvanians earn, there are no tax increases in this proposed state budget.

Dealing With the Hand We Were Dealt
Budget by the Numbers

Basic Education
  • This year's budget increases K-12 funding $230 million over Gov. Corbett’s original proposal. Dollars for all education levels represent 34 percent of the entire budget, or $9.59 billion.
  • The $5.354 billion Basic Education Funding subsidy in this budget replaces $1 billion of stimulus funds with state dollars.  This represents the largest investment of state funding ever for that funding stream.    View the funding history.
  • Restores state dollars for Basic Education Funding for all school districts to pre-federal stimulus (2008-09) levels. 
  • Restores $100 million for Accountability Block Grants for school districts to spend as they see fit, including pre-K or all-day kindergarten programs.
  • Helps school districts by paying a share of Social Security with $43 million.

Higher education – increases funding to $1.6 billion. 
  • State System of Higher Education will receive 82 percent of current funding, or $412 million. 
  • State-related universities will receive 81 percent of current funding, or $559 million. 
  • Community colleges will receive $258 million, or 90 percent of current funding.

Department of Public Welfare – reduces proposed increase in spending.
  • Cuts welfare spending by more than $400 million from Gov. Corbett’s original proposed budget. It’s a 3 percent cut, well within the 4 percent acknowledged “error rate.” The error rate was acknowledged by the Rendell Administration and was the department’s defense against the various findings by the auditor general.
  • Continues needed support for those residents who truly need that safety net. The Department of Public Welfare line is still 1 percent above last year’s level.
  • DPW will receive $10.5 billion in the new General Fund Budget.

Safety Net for Those Who Truly Need a Helping Hand –  Restoring funds for hospital and human services
  • This budget restores funds for hospital and human services by more than $55 million
  • Counties will be helped by nearly $15 million in the Human Service Development Fund.
  • People most vulnerable will be assisted through restorations for Domestic Violence ($12.2 million) and Rape Crisis ($7 million) services.
  • Obstetric and Neonatal services (for medical assistance recipients): $3.68 million.
  • Critical care hospitals (for medical assistance recipients): $3.57 million.
  • State-Related Academic Medical Centers (for medical assistance recipients): $12.6 million.
  • Physician Practice Plans (for medical assistance recipients): $6.4 million.
  • Trauma Centers: $8.65 million.
  • Burn centers: $3.78 million.
  • Cancer screening services: $2.56 million.

Jobs, the Number One Priority
  • The budget reinstates the phase-out of the Capital Stock and Franchise Tax, which will give job creators approximately $70 million in needed relief.
  • Tax credits for jobs. The budget includes tax credits to help improve the jobs climate in Pennsylvania:
    • Job Creation Tax Credit is capped at $55 million, an increase of $15 million.
    • Film Tax Credit will be capped at $60 million, a $15 million cut.
    • Research and Development (R&D) Tax Credit will be capped at $10.1 million, a $12.4 million reduction.