HARRISBURG, PA — Governor Josh Shapiro on Tuesday presented his 2026-27 budget proposal, pitching it as a continuation of what he called three years of measurable gains while laying out a new mix of spending priorities, revenue ideas, and policy changes aimed at lowering costs, expanding public safety efforts, and keeping Pennsylvania competitive in an economy increasingly shaped by artificial intelligence.
Shapiro’s administration said the proposal is balanced, does not raise taxes, and does not rely on any broad-based tax increase over the next five years. The governor also highlighted state revenue collections running $417 million above projections through the first seven months of the current fiscal year, calling it evidence that recent investments are fueling growth.
“From day one, my Administration has been laser-focused on delivering results for the people of Pennsylvania — and what we’re doing is working,” Shapiro said in prepared remarks, arguing the plan builds on investments in schools, public safety, and economic development.
The governor’s budget narrative ties its case to a list of performance claims, including nearly 30 percent growth in education funding during his tenure, unemployment remaining below the national average for 31 consecutive months, and job creation tied to major investment announcements. The administration said its development agenda has produced more than 21,500 jobs and attracted more than $39 billion in private-sector investment statewide.
Public safety is positioned as a central theme. The administration said violent crime is down 12 percent statewide and fatal gun violence is down 42 percent since a 2022 peak, citing Uniform Crime Reporting data and other analyses. It credited a combination of policing support and investments in afterschool programming and community-based violence intervention.
The proposal includes $68.3 million for the Pennsylvania Commission on Crime and Delinquency’s Violence Intervention and Prevention program, described as a $5.2 million increase, and adds $1 million to the Building Opportunity through Out of School Time program, bringing that program’s total to $12.5 million.
Shapiro also proposes $16.2 million for four additional state police cadet classes and eliminating the statutory cap on the number of troopers, a change his administration said would expand patrol capacity and improve response times. The administration said the funding would train 380 new state troopers beginning in 2026-27 and continue efforts to modernize the Pennsylvania State Police fleet.
For fire and emergency services, the budget proposes a $30 million investment in competitive grants through the Office of the State Fire Commissioner, described as doubling annual funding to support recruitment, retention, and capital needs for volunteer and professional companies.
Education spending again features prominently. The administration said the proposal directs an additional $565 million through the state’s adequacy formula and tax equity supplements. It calls for a $50 million increase in Basic Education Funding, bringing it to $8.31 billion, and a $50 million increase in Special Education Funding, bringing it to $1.58 billion. The plan also includes continued support for school safety and student mental health resources and continues proposed changes tied to cyber charter funding.
Beyond schools and safety, Shapiro’s proposal aims to build new recurring revenue streams. The administration said regulating skill games and legalizing adult-use cannabis could generate about $2 billion annually, framing that as long-term support for schools, public safety, and taxpayer relief.
Lieutenant Governor Austin Davis said the proposal aims to reinforce programs that support children and families, including afterschool programs, early childhood education, child care, and victim services.
The budget also includes a proposal to move $100 million from the Budget Stabilization Reserve Fund to create a new Federal Response Fund, which the administration said would allow the state to respond quickly when federal actions or delays threaten essential services. In outlining that plan, the administration pointed to past legal fights over funding and program continuity, including assistance connected to nutrition benefits, education funding, and public health grants.
Shapiro is also using the budget rollout to sharpen his argument that Pennsylvania can lead in data centers and AI while setting guardrails to protect communities. The administration said it is advancing a framework called the Governor’s Responsible Infrastructure Development standards, or GRID, built around commitments on power sourcing, water conservation, transparency with local communities, local hiring and training, and accountability tied to permitting and incentives.
In parallel, the governor is proposing steps to address risks tied to unregulated AI use, with an emphasis on guidance for schools, parents, caregivers, and professionals. The administration said it is calling for legislative protections including age verification, clearer disclosures that users are interacting with AI, and restrictions on sexually explicit or violent content involving minors.
On workforce, the administration highlighted growth in career and technical education and apprenticeship participation and proposed additional investments in vo-tech, apprenticeship programs, and adult literacy. It also proposed creating a dedicated appropriation for WEDnetPA at $12.5 million and adding funding for internships through a Career Connect program.
Child care is another major plank. The administration cited workforce shortages in the sector and proposes an additional $10 million for child care worker support in the Child Care Works Program, bringing that total investment to $35 million. The plan also includes added funding for Pre-K Counts and Head Start supplements, and increases support for student teacher stipends through PHEAA, with the administration proposing a $5 million boost to bring annual support to $35 million.
Shapiro again called on lawmakers to raise Pennsylvania’s minimum wage to $15 an hour beginning January 1, 2027. The administration said that change would increase earnings for low-wage workers while reducing reliance on public assistance programs and generating new state revenue.
The proposal also outlines policy initiatives beyond the traditional budget ledger, including changes tied to housing stability, protections for manufactured home residents, property transfer tools intended to reduce tangled titles, and planning reforms meant to reduce barriers to residential development.
The administration said the plan is anchored by fiscal discipline and cited two credit rating upgrades during Shapiro’s tenure, estimating more than $200 million in avoided borrowing costs. It also promoted reforms intended to speed up licensing, permitting, and business processing times, including a system that offers refunds when the state misses certain deadlines.
The budget proposal now moves to the General Assembly, where lawmakers will hold hearings and begin negotiations ahead of the next fiscal year.
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