Wolf Presents 2016-17 Budget Proposal

Gov. Tom Wolf went before a joint session of the General Assembly on February 9 to unveil his Fiscal Year 2016-17 budget proposal, spending most of the time pointing out the still on-going 2015-16 budget impasse. As expected, it closely resembled the prior proposal, with some tweaks to acknowledge some of the agreements reached with legislators, and recalculated expectations of some of last year’s revenue projections. Wolf stated he continues to hope that the so-called “framework” that he had apparently worked out with House and Senate leaders, only to have it rejected by rank and file before the General Assembly passed a budget that the Governor line-item vetoed substantial parts of, in hopes of bringing them back to the table, will be considered again soon, and provide a platform for a new budget discussion that would hopefully be more successful, in this election year.
In a briefing to reporters prior to the address, Budget Secretary Randy Albright said the administration still hopes that the bipartisan plan is adopted and has predicated its plan on that point, but noted the 2016-17 proposal focuses on addressing the state’s growing deficit and other fiscal challenges, relegating some 2015-16 priorities like school funding reform. Outlining the governor’s proposal, Sec. Albright said the $32.7 billion total spending figure is driven by $1.6 billion in mandated spending increases, including $100 million in debt obligations, $178 million for corrections spending, $800 million for human services and $500 million in rising pension costs.  To the human services increases, Sec. Albright explained the $800 million total includes a required increase in state spending as a resulting of larger federal reimbursements for Medicare and Medicaid, as well as $290 million in costs associated with “one-time gimmicks” previously used to balance the budget. With respect the pension increase, Sen. Albright advised 2016-17 is the last year of “significant, stepped-up” yearly increases, after which they will be more like “annual inflationary” increases.
Discussing the General Fund financial statement used by the administration in crafting its proposal, Sec. Albright noted the revenue projection for 2016-17 is several hundred million dollars over the estimate provided by the Independent Fiscal Office; a figure he said will require ongoing monitoring.
Discussing the revenues needed to pay for the spending increase, Sec. Albright outlined a “sustainable revenue package” proposed by Gov. Wolf, which includes:
Personal Income Tax increase from 3.07 to 3.4 percent;
Expansion of the Sales Tax base to include movie theater tickets, digital downloads, basic cable, and an elimination of the vendor sales tax discount;
Bank Shares Tax increase from 0.89 percent to 0.99 percent;
Insurance premiums tax surcharge for P+C and Fire of 0.5 percent;
Cigarette tax increase $1.60 to $2.60 per pack;
Tax on other tobacco products of 40 percent
Severance tax of 6.5 percent, with Impact Fee credit;
Tax on promotional play at casinos of eight percent
Other elements of the proposal include:
In Education:
Increases basic education funding by $200 million, special education by $50 million, and Pre-K/Headstart by $60 million;
Accountability initiatives including the Office of School Improvement and School Performance Profiles;
Implement 2014 Special Education Funding Commission charter reforms;
End pension “double dip;
Implement charter school reimbursements to school districts based on audited costs
$15 Million increase in funding for career and technical education;
Two-year five percent increases for higher education
Job Creation
$45 million for PA First;
$15 million for Keystone Communities;
$30 million for the Infrastructure and Facilities Improvement Program;
$798,000 for preparations in advance of Base Realignment and Closure;
Increase minimum wage to $10.15 an hour.
Complete information regarding the budget request can be found on the Governor’s website.
Governor’s Office Publishes Regulatory Agenda
Executive Order 1996-1 requires all agencies under the jurisdiction of the Governor to submit for publication an agenda of regulations under development or consideration. Subsequent agendas will be published on the first Saturdays in February and July. The agendas are compiled to provide members of the regulated community advanced notice of regulatory activity. It is the intention of the Administration that these agendas will serve to increase public participation in the regulatory process. Gov. Wolf publishes his update in the February 27, 2016, PA Bulletin.
The public is invited and encouraged to provide feedback regarding the Regulatory Agenda, including but not limited to feedback regarding its usefulness, the nature and extent of readers’ usage of the Agenda, the frequency with which users consult or refer to the Agenda and any other general suggestions which the public may have regarding the Agenda. Comments may be sent, preferably by e-mail, to Marc Farrell, Regulatory Specialist, Governor’s Office of Policy and Planning, marcfarrel@pa.gov or alternatively by regular mail to Marc Farrell, Regulatory Specialist, Governor’s Office of Policy and Planning, 602 Main Capitol Building, Harrisburg, PA 17120.
Below are a listing of upcoming regulations of potential interest to PSPE.

Regulation Being Considered Proposed Date of Promulgation Need and Legal Basis for Action Agency Contact
State Registration Board for Professional Engineers, Land Surveyors and Geologists
Electronic Seals and Signatures
49 Pa. Code Chapter 37
Spring 2016, as Proposed In addition to updating their current regulations on seals, the three boards that regulate design professionals in this Commonwealth (including the State Architects Licensure Board, the State Registration Board for Engineers, Land Surveyors and Geologists, and the State Board of Landscape Architects) are proposing new regulations setting forth standard requirements for electronic seals and electronic signing of design documents. The goal of these proposals is to provide all design professionals with regulations that are as consistent as possible with respect to both traditional seals and electronic seals to benefit both the design professionals and their clients. Robin Shearer
(717) 783-7049
Renewal Fees
49 Pa. Code § 37.17
Summer 2016, as Final Under section 9(a) of the Professional Engineer, Land Surveyor and Geologist Registration Law (63 P. S. § 156(a)) (act), the Board is required by law to support its operations from the revenue it generates from fees, fines and civil penalties. In addition, the act provides that the Board shall increase fees if the revenue raised by fees, fines and civil penalties is not sufficient to meet expenditures over a 2-year period. The current fee structure is inadequate to support the operations of the Board. This proposed rulemaking seeks to increase the biennial renewal fee for licensees from $50 to $100 so that revenues are sufficient to cover projected expenditures as required by the act. Robin Shearer
(717) 783-7049

Legislative Activity
The General Assembly acted on the following bills of interest to PSPE in the past month.
SB 316  RE: Service Contracts Terms (by Sen. Mike Folmer, et al)
Amends Title 62 (Procurement), in general provisions, providing for public access to procurement records; and, in source selection and contract formation, further providing for sole source procurement and for emergency procurement. Records concerning a procurement shall be made public, consistent with the Right-to-Know Law. The bill stipulates that procurement documents shall be posted on the purchasing agency’s website. For certain procurements over $250,000, the determination shall be signed by the head of the purchasing agency. Two quotes shall be solicited for emergency procurement; no written contract may be required. Lays out guidelines for legal services contracts.
Reported as committed from House Appropriations Committee, 2/8/2016 
HB 1850 RE: Science and Math Education Programs (By Rep. Aaron Kaufer, et al)
Act appropriating $2,114,000 from the General Fund to the Department of Education for the purpose of mobile science and math education programs for the fiscal year July 1, 2015, to June 30, 2016.
Introduced and referred to House Appropriations Committee, 2/10/2016
HB 914  RE: Sewage Fees Increase (by Rep. Chris Ross, et al)
Amends the Pennsylvania Sewage Facilities Act authorizing a local agency to charge a fee of up to $100 (increased from $25) to verify the permit-exempt system is located in accordance with siting requirements.
Reported as amended from House Local Government Committee, read first time, and laid on the table, 2/10/2016
HB 1661  RE: Storm Water Management Plans (by Rep. Mark Mustio, et al)
Amends the First Class Township Code adding an article providing for storm water management plans and facilities. The board of commissioners is authorized to plan, design, construct, assemble, install and alter facilities to manage surface water runoff.
Received in the Senate and referred to Senate Local Government Committee, 2/3/2016
Cosponsor Memo Filed
HCO2825 (Delozier) – Creates a building code official “trainee” program.
Filed, 2/10/2016 
HB 802 RE: CE Carryover (by Rep. Harry Readshaw, et al)
Amends the act entitled, “An act empowering the General Counsel or his designee to issue subpoenas for certain licensing board activities; providing for hearing examiners in the Bureau of Professional and Occupational Affairs; providing additional powers to the Commissioner of Professional and Occupational Affairs; and further providing for civil penalties and license suspension,” adding that in addition to disciplinary powers and duties, boards and commissions shall have the power to provide for the carryover of any continuing education credits in excess of the number required for biennial renewal. The carryover shall be valid for one biennial renewal term only.
Laid on the table, 2/8/2016 
HB 1704   RE: Registration Board Changes (By Rep. Mark Mustio, et al)
Amends the Engineer, Land Surveyor and Geologist Registration Law changing the definition of “Engineer-in-Training” to “Engineer Intern”. Removes certain exemptions from licensure and registration.
House Professional Licensure Committee Meeting cancelled for 2/10/16