What we now know – and don’t know – about the Pennsylvania budget

Nearly a month into the 2025-26 fiscal year, Pennsylvania is still waiting on a state budget as negotiations continue in Harrisburg between state lawmakers and Gov. Josh Shapiro’s office. 

Shapiro outlined a $51.5 billion spending plan in his February budget address, where he laid out his priorities for the state. However, Republican lawmakers who control the state Senate have expressed concerns with the level of spending that Shapiro proposed. 

Below, City & State examines what we know and what we don’t know about this year’s state budget. 

What We Know

Shapiro’s budget ask was $51.5 billion

In his annual budget address in February, Shapiro laid out a $51.5 billion executive budget proposal that called for increased education funding, legalized recreational cannabis, a tax on so-called games of skill and increased funding for mass transit, which comes as multiple mass transit agencies across the state beg for more state funding.

The budget was due July 1 

Pennsylvania’s fiscal calendar spans from July 1 to June 30, meaning that the commonwealth hasn’t had an enacted budget for almost a month. That number will continue to grow until the governor signs budget legislation into law. 

House lawmakers passed a budget

Lawmakers in the state House voted to pass a General Fund budget bill on July 14 with a 105-97 vote, though the legislation, which had a total spend number of $50.6 billion, was not a spending plan that was agreed to by all four legislative caucuses – and talks continue on reaching an agreed-to state budget.

Leaders say budget talks remain ‘cordial’

Despite frustrations over the drawn-out nature of budget negotiations, Republicans and Democrats have described ongoing negotiations as a largely positive experience thus far – and both Shapiro and Senate Majority Leader Joe Pittman have emphasized that talks have been “cordial.”

“We’re having very cordial and positive conversations, but there is a long way to go,” Pittman told the Pennsylvania Cable Network on July 17. “Make no mistake, in divided government, we have some very philosophical differences that are deep, and those deep philosophical differences need to be reconciled somehow, some way.”

Shapiro concurred in remarks to the press on Wednesday. “I can tell you that in my discussions with Republican leaders in the Senate, Democratic leaders in the House … it’s been cordial, it’s been respectful,” he said. “Everybody understands the issues, and we’re working hard to find common ground.”

Shapiro says the budget process is frustrating

During an event in Lewistown on Wednesday, Shapiro noted that the drawn-out nature of budget negotiations can be frustrating. 

“I wish it didn’t take this long. I’m frustrated by how long it takes. I introduced my budget about 160 days ago,” Shapiro said. “That being said, this is where we are, and we’re working through it, and I’m very hopeful that we’re going to find that common ground, invest again in our schools, safety and economic development – and continue the string of successes we’ve had by finding that common ground between Democrats and Republicans.”

What We Don’t Know

When a final agreement will be reached

While the House passed legislation that will likely serve as a vehicle for the final budget deal, it’s still unclear when a final agreement will be agreed to in a manner that satisfies the Republican-controlled state Senate, the Democratic-controlled House and Shapiro. 

Pittman told PCN that budget talks are “progressing incrementally.”

“This is serious work. It’s important work. It’s complicated work. There are a lot of moving parts, there are a lot of issues, and we have to get this right,” Pittman said. “If it’s going to take us a little longer to get that in place, we’re going to take the time necessary to get it done right.”

The sticking points

There are a number of policy issues that have emerged as potential sticking points in this year’s budget negotiations, and it’s not certain what agenda items will make it through the budget cycle and become law – and which will get left behind. 

Legal weed appears unlikely to materialize, with the chair of the Senate Appropriations Committee, state Sen. Scott Martin, telling reporters this month: “I would never run that through my committee.” That comes despite an ongoing public push from boxing legend-turned-marijuana legalization advocate Mike Tyson, who is seeking to change Martin’s mind on the issue. In addition, mass transit funding has been a particularly fraught issue this budget cycle, as SEPTA, the Philadelphia region’s transit authority, faces service cuts without increased state funding. 

Republican lawmakers have also expressed concern about the overall level of spending in Shapiro’s budget proposal, with Pittman adding that addressing the state’s structural budget deficit is a priority of the Republican caucus. 

“Our overall priority is to try to maintain stability in keeping our fiscal house in order,” Pittman told the outlet. “Containing spending is very critical. We have a structural deficit that we’ve talked about at great length, and while we’re not going to be able to fix that structural deficit overnight, we certainly need to take steps to protect the taxpayer, not just in this fiscal year, but in the years ahead.”