No quick end in sight to budget standoff

Republicans & Democrats continue to blame each other as communities begin to feel the effects.

Pennsylvania is now one of just two states without a budget for the 2025-26 fiscal year — and the consequences are stacking up.

Nearly three months after the state’s June 30 deadline, the partisan standoff in Harrisburg has forced counties to borrow money, cut services and brace for deeper disruptions as school districts warn of financial strain in the weeks ahead.

While most states — and even the U.S. Congress — have found ways to keep government operations moving, Pennsylvania lawmakers remain locked in a fight over spending levels, education funding and policy priorities. Without a compromise, Gov. Josh Shapiro can’t release critical funds to counties, schools and state-run programs.

Counties are among the first to feel the impact. Funding for essential programs — child welfare services, senior centers, drug and alcohol treatment, and public health departments — is on hold. Many counties with limited reserves have taken out loans or made cuts.

“It means third-party providers are just going to get paid less until the counties are fully funded,” said Kyle Kopko, executive director of the County Commissioners Association of Pennsylvania. “That’s going to affect their bottom line and payrolls, too.”

Kopko said some counties have already frozen travel reimbursements, halted overtime or reduced services. While most counties are staying afloat for now, school districts may face difficult choices in October.

“Come next month, some schools are going to face real financial pressure,” he said.

Republicans: Pass a stopgap

Republicans in Pennsylvania’s House and Senate say

BUDGET •A5

“Come next month, some schools are going to face real financial pressure.”

KYLE KOPKO

COUNTY COMMISSIONERS ASSOCIATION OF PENNSYLVANIA the solution is simple: follow Washington’s lead.

Earlier this month, Congress passed H.R. 5371, the Continuing Appropriations and Extensions Act of 2026, to avoid a federal shutdown. The short-term funding bill, approved 217-212, was described by GOP leaders as a “clean” and “responsible” step to keep government running while negotiations on appropriations continue.

“Keeping the lights on is not a partisan issue — and this clean, shortterm funding extension reflects that,” said U.S. Rep. Tom Cole (ROK), who chairs the House Rules Committee.

Pennsylvania House Republicans argue that their own short-term solution — using last year’s budget to maintain funding — has been unfairly blocked by House Democratic leadership.

“What some are calling a budget crisis, I’m calling an intentional and dangerous political stunt,” said Rep. Eric Davanzo (R-Smithton). “Two weeks ago, I and every other member of the House Appropriations Committee — Republicans and Democrats — voted in favor of ending the fiasco by extending last year’s budget to the current year. This could have, should have, been over.”

In a letter sent to Westmoreland County Commissioners last week, five GOP lawmakers, including Eric Davanzo and Reps. Abby Major and Eric Nelson, said the House Appropriations Committee unanimously passed an interim budget Sept. 10 with bipartisan support. But House Speaker Joanna McClinton and Majority Leader Matt Bradford have not called the full House back into session for a vote.

“We stand firmly against reckless overspending and support the passing of last year’s budget to continue uninterrupted delivery of essential public services while new spending is negotiated,” the lawmakers wrote. “Essential services should not be used as leverage to overspend.”

Rep. Bud Cook, R-West Pike Run Township, echoed those frustrations, calling out House Democrats and Shapiro.

“We are approaching three months past the budget deadline,” Cook said. “House Democrats are currently sitting on a bill that would get funding to schools, counties and social services. Yet, we are waiting for them to act. Gov. Josh Shapiro needs to provide real leadership and hold his party accountable. It’s unacceptable we are at this point when Shapiro talks about leadership but refuses to show it, and people across the commonwealth are left waiting.”

Rep. Andrew Kuzma, R-Elizabeth Township, stressed that any agreement must balance fiscal responsibility with economic priorities.

“All sides continue to work hard to come to an agreement. We cannot increase taxes on our hard-working citizens. We must look at ways to balance spending and revenue,” Kuzma said. “My priority is economic development. We need family-sustaining jobs and an economy that encourages business to locate in the Mon Valley. I will continue to focus on what’s best for our area. Any agreement must not place a burden on the taxpayers.”

Rep. Tim O’Neal, R-South Strabane Township, emphasized similar concerns.

“All parties continue to work to find an agreement. We cannot tax our way to prosperity,” he said. “The governor’s $51.5 billion plan would spend more than $5 billion more than the commonwealth is projected to bring in for fiscal year 2025-26.

“The best way to increase revenue is not with taxes. It is by growing the economy. The House Republican priorities are to grow the economy through the energy industry, smart and efficient education spending and government accountability so that policy isn’t driving inflation. I am steadfast in my commitment to the residents of the 48th Legislative District to crafting an agreement that is responsible to the taxpayers and grows Pennsylvania’s economy.”

Republicans also criticized Shapiro’s proposed $51.5 billion budget proposal, which is roughly $3 billion higher than the Independent Fiscal Office’s revenue projection of $48.3 billion. They argue accepting that number would set the stage for future tax increases or cuts to services.

Rep. Ryan Warner, R-Perryopolis, called the stalemate avoidable and urged the House to pass the Senate’s stopgap bill. “This is 100% a manufactured budget impasse. We have a bipartisan budget in Senate Bill 160 that was passed unanimously by the House Appropriations Committee,” Warner said. “Unlike the budget originally proposed by Gov. Josh Shapiro, this plan spends within our means rather than relying on raiding our reserve funds or increasing taxes. We should pass it in its current form next week. Period.

“Our citizens, families and employers are struggling with rising costs for virtually everything we need. The people of Fayette County and the commonwealth cannot afford to have the government take more of their hard-earned money. As the prime sponsor of the Taxpayer Protection Act, I will not support a budget that spends more than our citizens can afford.”

Democrats: Communities are already struggling

Sen. Lindsey M. Williams, D-West View, said the budget stalemate is inflicting real harm on Pennsylvanians who rely on state funding for core services.

“As the Pennsylvania State Budget stalemate enters its third month, people are being hurt — libraries might soon shutter, support services in struggling school districts go without, mass transit loses stability, and families are waiting for action,” Williams said.

Senate Minority Leader Jay Costa, D-Forest Hills, echoed that concern, arguing that Republican leaders are dragging their feet instead of negotiating seriously.

“Republicans in the Senate are walking away from the table instead of negotiating in good faith,” Costa said. “Pennsylvanians need us to finish the job — not stall and jeopardize schools, counties and vital services.”

House Democrats have also criticized what they describe as a refusal by Senate Republicans to compromise. Speaker Joanna McClinton (D-Philadelphia) said the House has already advanced its budget plan, and that any final deal will require cooperation.

“House Democrats, even with a razor- thin majority, have demonstrated time and time again that we are ready to work together and compromise to pass legislation that moves Pennsylvania forward,” McClinton said. “Unfortunately, Senate Republicans have not been willing to come to the table with the realization that any solution will take bipartisan support.”

Democrats in both chambers have stressed that their priorities include more than $500 million in new K-12 education funding through the adequacy formula created after a court found the state’s school system unconstitutional. They are also pushing for recurring, reliable funding for public transit, protections for Medicaid in the face of federal cuts and a long-delayed increase to the minimum wage.

Mass transit deal reached, but education still stuck

Lawmakers did resolve one major budget fight — how to fund public transit — but it came at a cost.

Instead of increasing state subsidies, Republicans and Democrats agreed to redirect unused capital project funds to SEPTA and Pittsburgh Regional Transit. The deal buys those systems about two years of operational runway, but leaves smaller, rural transit authorities out of the picture. Shared Ride programs for seniors and people with disabilities could be the first to feel the squeeze.

“We are in this predicament … only because Senate Republicans failed to come to the table with a real solution,” said Beth Rementer, a spokesperson for House Democrats.

Republicans argue the capital fund was overstocked and underused. They say the stopgap measure keeps buses running and gives the legislature time to debate long-term reforms.

Education funding remains a sticking point

The biggest unresolved issue is education.

House Democrats are pushing to add more than $500 million in K-12 funding through a new formula that prioritizes low-income districts and English language learners. The formula was created after a Commonwealth Court ruling found the state’s school funding system unconstitutional.

Republicans have pushed back on both the formula and the spending levels, suggesting alternatives that would direct less money from the state and shift more responsibility to local districts.

Other major debates still on the table include:

• Whether to legalize adult-use cannabis.

• Taxing “skill games” found in bars and convenience stores.

• Reforming cyber charter school funding.

• Medicaid funding adjustments after federal cuts.

• Raising the state minimum wage.

• New incentives for energy production.

Clock still ticking

Despite repeated claims that negotiations are progressing, there’s no sign of a deal.

“It’s their one job to put a budget on my desk,” Gov. Shapiro said, criticizing Senate Republicans for a lack of urgency.

As counties borrow and schools brace for cuts, GOP lawmakers say Democratic leaders are dragging out the fight for leverage. Democrats, meanwhile, argue Republicans are refusing to engage seriously on long-term funding priorities.

For now, the standoff continues. The House is scheduled to return for a voting session at noon Monday. The Senate remains on 24-hour call, meaning they could return sooner if a compromise is reached, but their next scheduled session is not until late October. They will convene Oct. 3, but that is for a non-voting session — which means, at best, movement on a state budget is still at least a week away.