HARRISBURG, PA — Pennsylvania’s 2026-27 budget directs $958.5 million toward road, highway and bridge work, including $775 million for shovel-ready projects statewide over the next two fiscal years, as lawmakers seek to accelerate construction without broad-based tax increases.
The package provides an additional $183.5 million for highways and bridges in the current fiscal year, according to state Rep. Ed Neilson, chairman of the House Transportation Committee.
The $775 million will support state-road projects across all 67 counties. Neilson indicated the funding will come through the Motor License Fund, which finances transportation infrastructure through vehicle-related taxes and fees.
“By using the Motor License Fund for much-needed maintenance on our bridges and roads, projects can be completed faster without hurting taxpayers,” Neilson stated.
The transportation spending is part of a roughly $50.8 billion general fund budget, an increase of about 3.7% from the previous fiscal year. The agreement avoided major broad-based tax increases and preserved scheduled reductions in Pennsylvania’s Corporate Net Income Tax.
The spending plan also keeps more than $7 billion in the state’s Rainy Day Fund intact. Lawmakers relied on approximately $1.5 billion in unspent appropriations and lapsed agency balances to close the budget gap.
“I’m proud of the work we accomplished to keep Pennsylvania roads safe and up to par,” Neilson remarked. “This was a bipartisan effort that ensures roads, highways and bridges across the commonwealth will be safer and more efficient — for now and future generations.”
Beyond transportation, the budget increases education funding, including $565 million for adequacy and tax-equity supplements, $58 million for the Basic Education Funding formula and $55 million for special education.
The package also provides cost-of-living adjustments ranging from 15% to 24.5% for eligible state pensioners who retired before July 2, 2001. The increases apply to qualifying beneficiaries in the Public School Employees’ Retirement System and State Employees’ Retirement System.
Separate provisions require commercial data center operators to report annual energy consumption and peak electricity demand to the Pennsylvania Department of Environmental Protection.
An earlier proposal to legalize and tax skill games was excluded from the final agreement.
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