First Week of Budget Hearings Zeros in on Spending Plan Specifics, Job Creation

From PA Chamber of Business & Industry

The first of two weeks of budget hearings was held last week, as lawmakers on the House and Senate Appropriations Committees met with the heads of state agencies and state row offices to discuss the proposed appropriations in Gov. Tom Wolf’s 2018-19 state budget, current issues facing each department and what they foresee coming up in the year ahead.

One of the first hearings – the House Appropriations Committee’s hearing with the Independent Fiscal Office – focused partly on the governor’s proposed severance tax on the natural gas industry. IFO Deputy Director Mark Ryan stated that the cost of implementing a new severance tax – which would be in addition to the existing impact tax – would amount to $17 million. Several Republicans on the committee expressed their disagreement with the administration over raising taxes to generate more revenue. The PA Chamber agrees that a severance tax – which unfairly singles out the natural gas industry – is both unfair and hurts the state’s economic competitiveness, which is why our organization is leading a broad-based coalition in opposition to higher energy taxes in this year’s budget negotiations. The IFO also said that while Gov. Wolf’s proposed increase in the minimum wage to $12 an hour would generate more spending and economic activity, it could come at a price – it is likely that the hike in minimum wage would also decrease jobs. In fact, last year, the IFO studied the impact of a minimum wage increase and found that it would cost the state about 54,000 jobs and raise $60 million less than proponents thought it would.

The House Appropriations Committee also focused its attention on job creation at hearings with the Department of Community and Economic Development and the Department of Labor and Industry last week. According to a Capitolwire story, Committee Chairman Stan Saylor, R-York, said he wanted to “take a deep dive into the effectiveness of our current programs for job creation,” stating his belief that money dedicated toward the state’s Workforce Development Board would be better spent on direct job training. Secretary Dennis Davin of DCED and Secretary Jerry Oleksiak of L&I spoke up in support of Gov. Wolf’s proposal to increase funding for a new state Apprenticeship and Training office and boosting spending within the Industry Partnerships program by $3 million in next year’s budget.

According to both secretaries, the extra apprenticeship program funding would be used to double the number of registered apprentices working in manufacturing, businesses and the labor trades and expand apprenticeship opportunities for youth and adults. They mentioned the Shell cracker plant in Beaver County as an example of a place where new manufacturing jobs will be created, and that skilled workers will be needed to fill them.  They also discussed legislation that aims to consolidate workforce development programs within L&I, DCED and the Department of Human Services to maximize their effectiveness. “This proposal would give DCED, the agency that is tasked with keeping current employers in Pennsylvania and bringing new opportunities into the state, the much-needed tools to help connect employers who have job openings with workers qualified to fill them,” said the bill sponsor, Rep. Justin Walsh, R-Westmoreland.

At the Senate Appropriations budget hearing with the Department of State, the ongoing issue of the state’s Congressional maps was raised and there was some controversial discussion when Acting Secretary Robert Torres said that the administration does not intend to publish in every county the maps that were imposed by the state Supreme Court last Monday – and that they would focus on sharing the information through press releases, the DOS website and social media. “You’ve changed the maps in the state. Even if the Supreme Court doesn’t order it, I believe the voters should know where they are within those districts, and the maps should be published,” said Sen. Mario Scavello, R-Monroe.  According to a Capitolwire story on the hearing, Jonathan Marks, commissioner of the Bureau of Commissions, Elections and Legislation, said that the issue is publishing maps in newspapers in every county, as is required in Pennsylvania statute under normal circumstances. “When a redistricting plan is enacted, there’s a publication requirement …. Where you would publish in two newspapers of general circulation in every county,” Marks said. “The Court has not mandated that … at least not yet, but we are using other avenues to get the word out to voters.”

Budget hearings will continue all this week. The Senate Appropriations Committee is hosting all of its budget hearings in Hearing Room 1 of the North Office Building in the state Capitol; while the House Appropriations Committee is holding all of its hearings in Room 140 of the Main Capitol Building. The budget hearing schedule, which is subject to change, is available on the General Assembly website; the PA Chamber will be reporting noteworthy information from these hearings in next week’s edition of Sentinel.