For Immediate Release
7/4/08

- Sen. Scarnati
- Sen. Pileggi
- Sen. Armstrong
- Sen. Orie
- Sen. Baker
- Sen. Robbins

Senate Approves Final 2008-09 Budget Bill

Spending kept below rate of inflation

The Senate today approved a state budget for Fiscal Year 2008-09 that holds the line on state spending while ensuring the continuation of essential services and programs.

Senate Bill 1389 calls for $28.2 billion in general fund spending, which is nearly $150 million less than the $28.35 billion in spending proposed by the Administration. Overall, the 3.98 percent increase in spending from FY 2007-08 is below the 4.4 percent rate of inflation and represents a significant reduction from the 4.2 percent increase proposed by the Administration.

While spending is reduced across the board in this budget, including a 1.3 percent reduction for the Legislature and the Judiciary, Senate Republicans successfully fought to restore state support for essential services and programs such as neonatal hospitals, burn centers and critical care access hospitals.

Senate Republicans also stood firm in ensuring that the Commonwealth honored its commitment to Pennsylvania's employers and job creators by maintaining the scheduled reduction of the onerous Capital Stock and Franchise Tax. The Administration had proposed slowing the reduction, which would have cost employers an estimated $40 million in FY 2008-09.

One of the key elements in the FY 2008-09 budget is a more equitable proposal for funding basic education in Pennsylvania, including an overall 5.5 percent increase ($274.7 million) in basic education funding to a total of $5.2 billion. More than 100 of Pennsylvania's 501 school districts would have seen a minimal increase of 1.5 percent in their basic education subsidies under the Administration's proposal. Senate Republicans pushed for the current plan which ensures that every school district in Pennsylvania receive a minimum 3 percent increase in its basic education subsidy – providing increased support for 238 districts.

The State System of Higher Education received an increase of $15 million for a total of $519.2 million in FY 2008-09. Community colleges received a $6.9 million increase for a total of $280.7 million. Penn State University received a $4.1 million increase to $338.4 million. The University of Pittsburgh received a $2.6 million increase to $170.7 million. Temple University received a $2.6 million increase to $175.5 million. Lincoln University received a $707,000 increase to $14.5 million.

The budget provides for borrowing to make prudent investments in public infrastructure, such as bridges, dams and water and sewer projects. In particular, $350 million is set aside to make critical improvements to 400 bridges across the state. In addition, the voters will have the opportunity to participate in a referendum that would invest $400 million in new water and sewer projects across the Commonwealth.

Contact:

Carol Maravic
(717) 787-6725        

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