Governor Shapiro Unveils 2026–27 Budget Proposal to Keep Doing What’s Working in Pennsylvania: Cutting Costs, Growing the Economy, Strengthening Public Safety, Funding Education, and Getting Stuff Done for Pennsylvanians

Harrisburg, PA – Today, Governor Josh Shapiro presented his 2026–27 budget proposal to the General Assembly and the people of Pennsylvania — building on three years of historic progress by continuing to do what’s working across the Commonwealth to lower costs, create economic growth, strengthen public safety, support students, and continue Pennsylvania’s rise. The Governor’s budget proposal maintains fiscal responsibility, continues to cut taxes, and ensures taxpayer dollars are spent wisely.

“From day one, my Administration has been laser-focused on delivering results for the people of Pennsylvania — and what we’re doing is working,” said Governor Shapiro. “By listening to Pennsylvanians and working together, we’re solving problems and proving that government can be a force for good in people’s lives. This budget builds on the progress we’ve made by making smart, responsible investments that strengthen our schools, keep communities safe, and grow our economy. At a time when dysfunction and division seem to dominate elsewhere, here in Pennsylvania we’ve shown that we can still work together to get stuff done and build on what’s working — because Pennsylvania is on the rise.”

Since taking office, Governor Shapiro has made historic investments in education, strengthened public safety, raised wages for workers who care for Pennsylvania’s most vulnerable neighbors, and driven economic development that has created over 21,500 good-paying jobs and attracted more than $39 billion in private-sector investment across the Commonwealth. Under his leadership, Pennsylvania has increased education funding by nearly 30 percent, kept unemployment below the national average for 31 straight months, and become the only state in the Northeast with a growing economy. The Governor has cut taxes seven times — delivering relief for seniors, families, and small businesses — while making Pennsylvania more competitive and affordable.

At the same time, the Shapiro Administration has strengthened public safety by putting securing funding for nearly 2,000 additional police officers on the beat and expanding afterschool and community-based violence intervention programs. These efforts are delivering results: violent crime is down 12 percent statewide, and fatal gun violence has dropped 42 percent, helping communities across Pennsylvania feel safer and more secure.

This progress has been anchored by a strong commitment to fiscal responsibility. Through the first seven months of the current fiscal year, Pennsylvania has collected $417 million above revenue projections — reflecting an economy that is growing as a result of strategic investments made by the Shapiro Administration. This budget is balanced, does not raise taxes, and does not rely on any broad-based tax increase over the next five years, ensuring long-term stability while continuing to deliver results for the people of the Commonwealth.

Under Governor Shapiro’s leadership, the Commonwealth has earned two credit rating upgrades — saving taxpayers more than $200 million in borrowing costs — with benefits that extend to school districts and local governments that can now borrow at lower rates. By protecting the Rainy Day Fund, maintaining a balanced budget, and making smart, forward-looking investments, the Shapiro Administration is strengthening Pennsylvania’s financial foundation while continuing to deliver results for the people of the Commonwealth.

Part of that work also requires modernizing Pennsylvania’s revenue structure. The Governor’s budget proposal notes that regulating skill games and legalizing adult-use cannabis together could generate approximately $2 billion annually, providing long-term, recurring revenue to support schools, public safety, and taxpayer relief.

“This budget builds on real progress by staying focused on the people we serve,” said Lieutenant Governor Austin Davis. “I’ve had the privilege of meeting Pennsylvanians who are making their communities safer, teaching our youngest learners, and fighting for victims’ voices to be heard. This budget has their back — investing in afterschool programs, community organizations addressing gun violence, early childhood education and child care, and support for victims of crime. These investments will give every Pennsylvanian the tools to succeed today and build a stronger future.”

As the Governor begins his fourth year in office, the 2026–27 budget proposal builds on that momentum — continuing to invest in proven strategies, putting the people of Pennsylvania first, and positioning the Commonwealth for long-term growth.

Watch the Governor’s full budget address to a joint session of the House and Senate here and read the Governor’s full remarks as prepared for delivery here. 

Read more about the Governor’s 2026-27 budget proposal below, and you can read the full budget in brief here.

Supporting Law Enforcement, Reducing Crime, and Making Our Communities Safer

Governor Shapiro believes Pennsylvanians deserve to be safe — and feel safe — in their communities. Since he took office, violent crime has declined across much of the Commonwealth. According to Uniform Crime Reporting (UCR) data, homicides are down 35 percent since 2022, firearm-related crimes are down 40 percent, and assaults are down 26 percent. Over the past three years, the Shapiro Administration has provided funding for nearly 2,000 additional police officers, and expanded investments in afterschool and community-based violence intervention programs — producing real results and addressing the root causes of crime.

The 2026–27 budget builds on this progress with continued investments in law enforcement, first responders, and proven prevention programs.

• This budget includes $68.3 million for the Pennsylvania Commission on Crime and Delinquency’s (PCCD) Violence Intervention and Prevention (VIP) Program — a $5.2 million increase — and adds $1 million to the Building Opportunity through Out of School Time (BOOST) Program, bringing total BOOST funding to $12.5 million to keep kids safe, supported, and engaged.
• The 2026–27 budget continues this effort with a $16.2 million investment for four additional cadet classes and fully eliminates the statutory cap on the number of troopers — allowing for increased patrol visibility and faster response times. This funding will train 380 new state troopers beginning in 2026–27 and maintain a regular replacement cycle to modernize the PSP fleet and improve officer safety. Under the Shapiro Administration, the number of PSP vehicles exceeding 100,000 miles has been reduced by 40 percent.
• It includes a $30 million investment in competitive grants through the Office of the State Fire Commissioner (OSFC) — doubling annual funding — to support recruitment, retention, and capital needs for volunteer and professional fire companies. Additional investments include $550,000 to consolidate Capitol Complex security contracts and a proposal to provide death and workers’ compensation benefits to first responders while deployed by the Commonwealth during a disaster emergency under a Governor’s Emergency Declaration.

Several PCCD grant programs are currently duplicative or overly restrictive, limiting counties’ ability to use funding effectively — particularly for supervision, re-entry, and treatment services.

• The 2026–27 budget proposes a commonsense consolidation of multiple county-based funding streams for parole, adult probation, re-entry, and jail-based medication treatment into a single appropriation.

Protecting Pennsylvanians from Chaos and Confusion at the Federal Level

At a time when the federal government has created uncertainty and disruptions for communities across Pennsylvania, the Shapiro Administration has acted to protect residents and ensure essential services continue uninterrupted.

Governor Shapiro has taken legal action 19 times against the federal government in the last year, returning more than $3 billion legally owed to the Commonwealth, including critical funding for families and projects. His Administration has successfully challenged multiple federal actions in court — securing continued SNAP benefits for millions of Pennsylvanians, unfreezing billions in critical federal funding, stopping the unlawful decision to cut AmeriCorps programs across the Commonwealth, restoring over $230 million for school districts, blocking the Trump Administration from seizing the private medical records of patients at Children's Hospital of Philadelphia (CHOP), and forcing the release of more than $500 million in public health grants.

When the Trump Administration cut $18 million for homeland security funding to detect threats and keep people safe, the Governor went to court to protect Pennsylvanians. When SNAP funding lapsed, the Governor declared a state-level disaster and provided $5 million in state resources to support food banks.

• Recognizing that legal action alone is not enough, the 2026–27 budget proposes transferring $100 million from the Budget Stabilization Reserve Fund to a new Federal Response Fund. This fund will allow the Commonwealth to respond quickly to federal actions or inactions that threaten health, safety, or essential services for Pennsylvanians. Pennsylvanians pay $158 billion in federal taxes every year – and the Governor is making sure that as many of those resources as possible are returning to the Commonwealth.

Strengthening the Only Growing Economy in the Northeast Through Innovation, Agriculture, and Connectivity

Governor Shapiro has focused on making Pennsylvania more competitive by cutting red tape, streamlining permitting and licensing, and launching the Commonwealth’s first comprehensive economic development strategy in two decades. These efforts have attracted more than $39 billion in private-sector investment and created over 21,500 good-paying jobs — including the largest private-sector investment in state history through Amazon Web Service’s $20 billion initial infusion to build AI and cloud computing campuses, and the largest life sciences investment ever in Pennsylvania with Eli Lilly’s $3.5 billion manufacturing facility.

The Governor has paired these wins with targeted investments to modernize government, strengthen main streets, support small businesses and entrepreneurs, and prepare sites for growth — including $550 million to make Pennsylvania more competitive for business expansion. The 2026–27 budget builds on that momentum by investing in long-term economic growth and ensuring communities across the Commonwealth can compete and win:

• The PA First Program, which connects businesses with trained workers and supports job retention and capital investments, will receive an additional $10 million for a total of $38 million.
• The 2026–27 budget invests in life sciences, robotics, technology, energy, manufacturing, and agriculture, and introduces Innovate in PA 2.0. This $100 million program, funded through Insurance Premium Tax Credits, will expand venture capital access, strengthen leadership pipelines in life sciences and biotech, support clinical trials, commercialize university research, and seed regional venture studios.
• The 2026–27 budget proposes a $9 million increase for the Agricultural Innovation Grant Program, including $7 million in base grants and $2 million for a county biodigester pilot project, bringing total funding to $19 million to continue driving innovation in Pennsylvania agriculture.
• Building on actions to prevent service cuts and stabilize mass transit systems across the Commonwealth, the 2026-27 budget proposes transferring an additional 1.75 percent of Sales and Use Tax revenues to the Pennsylvania Transportation Trust Fund beginning July 1, 2027 — providing more than $300 million annually in recurring funding for mass transit statewide.

These investments reinforce Pennsylvania as the only growing economy in the Northeast — expanding opportunity, attracting investment, and connecting communities across the Commonwealth to economic growth.

Ensuring Responsible Data Center Development in Pennsylvania

Governor Shapiro is committed to positioning Pennsylvania as a national leader in the development of data centers and artificial intelligence (AI) — while ensuring that growth strengthens communities and puts Pennsylvanians first. With the AI economy expanding rapidly and global competition intensifying, Pennsylvania is uniquely positioned to lead thanks to its energy resources, world-class research institutions, skilled workforce, and a permitting process that delivers speed and certainty.

At the same time, Pennsylvanians have raised real concerns about the impact large-scale data center development could have on communities, utility bills, and the environment. To balance innovation with accountability, the Shapiro Administration is advancing GRID — the Governor’s Responsible Infrastructure Development standards — built on four core principles:

• Protecting Energy and Water Resources: Developers must bring their own power generation online or fully fund new generation to meet their needs — without driving up costs for homeowners or businesses. Projects must also meet the highest standards for environmental protection, including strict water conservation requirements.
• Transparency and Community Engagement: Developers must commit to open, transparent engagement with local residents and leaders. Communities deserve to know who is coming, what is being built, and how projects could impact their town — before development moves forward.
• Delivering Local Jobs and Community Benefits: Projects must hire and train local workers and enter into meaningful community benefit agreements that invest in local priorities, from schools and infrastructure to long-term economic development.
• Responsible Growth with Accountability: Only projects that meet these standards will receive the Commonwealth’s full support, including speed and certainty in permitting and access to available incentives — ensuring responsible development that reflects Pennsylvania’s values.

By holding developers to GRID principles, Pennsylvania can attract cutting-edge technology investment, compete for AI leadership, and grow our economy — while protecting communities, affordability, and the environment for generations to come.

Creating Safeguards and Protections for AI Use

Governor Shapiro is taking action to protect children, seniors, and vulnerable Pennsylvanians from the risks posed by unregulated AI. While these technologies can help kids be creative, explore, and problem-solve, AI companion bots are proliferating online, and some provide harmful or misleading guidance. Studies show that 30 percent of teens use AI chatbots daily, and some apps even claim to be real doctors or licensed professionals — posing serious safety risks.

To address these challenges, the Governor is directing the departments of State, Education, and Health, along with the Pennsylvania State Police, to create clear guidance for safe AI use, reinforce human judgment, and expand digital literacy for students, parents, caregivers, and professionals. This guidance will help Pennsylvanians engage with AI in ways that are safe, secure, and developmentally appropriate. The Governor is also calling for legislative protections, including:

• Age verification to ensure children are not exposed to content they cannot safely process
• Alerts to parents if a child indicates self-harm or violent intentions
• Transparency reminders that users are interacting with AI, not a human
• Prohibitions on sexually explicit or violent content involving minors

These measures set guardrails that allow AI innovation to advance the public good without compromising safety, privacy, or well-being.

Building upon Historic Investments in Education and Creating Opportunity for Our Students to Succeed

Governor Shapiro believes that growing Pennsylvania’s economy and creating opportunity for future generations starts in the classroom. Over the past three years, his Administration has proposed and secured historic investments in education — increasing K–12 funding by nearly 30 percent, creating a State Board of Higher Education, implementing a performance-based funding formula for state-related universities, and expanding access to career and technical education for thousands of students. As a result, more students have access to mental health support, start the day ready to learn, and are achieving higher attendance and graduation rates.

The 2026–27 budget builds on these successes by adequately funding all public schools, supporting safe learning environments, and continuing to reform the way schools pay for cyber charter schools. Including:

• Adequately Funding Our Schools: The budget directs an additional $565 million through the bipartisan adequacy formula and tax equity supplements to ensure resources reach the schools that need them most. Basic Education Funding increases by $50 million, totaling $8.31 billion, while Special Education Funding grows by $50 million, totaling $1.58 billion to support students with disabilities and special needs. Funding supports after-school programs, full-day pre-K and kindergarten, evidence-based reading instruction, school libraries, social and health services, and professional development for educators.
• Continuing Cyber Charter Reform: Building on historic reforms in last year’s budget, the 2026-27 budget further aligns cyber charter funding to actual costs, saving school districts an estimated $75 million annually and bringing total savings from these reforms to $250 million per year. Accountability measures ensure students have regular contact with teachers and remain safe and engaged online.
• Creating Safe and Healthy Learning Environments: The budget continues funding universal free breakfast, menstrual hygiene products at no cost to students, and $111 million for school safety and mental health supports. Over 800 schools have expanded mental health services, and more than 200 counselors have been hired since the Shapiro Administration began. School facilities investments total $125 million, including $25 million for the Solar for Schools program. To date, the Governor has secured $400 million for 208 school facilities and solar projects that fund repairs and upgrades, with additional projects expected to be awarded near the end of this fiscal year.
• Reducing Distractions to Improve Learning in the Classroom: Supporting students isn’t just about funding schools — it’s about creating a healthy, productive learning environment. Cell phones and mobile devices can distract from instruction, peer interaction, and skill development. Governor Shapiro is calling on the General Assembly to pass a bell-to-bell cell phone ban, keeping devices out of students’ hands from the start of the school day until dismissal to help them focus, engage with peers, and build social and emotional skills.
• Supporting Student Well-Being Through Recess and Breaks: The Governor is also urging the State Board of Education to provide guidance on scheduled recess and breaks, giving students time for movement, social interaction, and stress management so they return to learning refreshed and ready to succeed. These breaks help students clear their heads, engage with peers, and return to the classroom focused and ready to succeed. Recess is not an extra — it is a fundamental part of children’s growth, teaching skills like collaboration, conflict resolution, and self-regulation that are just as essential as math, science, and reading.

Supporting Performance and Opportunity within Higher Education

Governor Shapiro led the first comprehensive reforms to Pennsylvania’s higher education system in decades, creating the State Board of Higher Education and establishing the Performance-Based Funding Council. This bipartisan framework directs funding to Penn State, University of Pittsburgh, and Temple University based on metrics that increase degree attainment, promote affordability, and meet workforce needs, including graduation rates, transfers from community colleges, and enrollment from underrepresented high schools.

• The 2026–27 budget proposes a $30 million investment in performance-based funding for these state-related universities and $1.1 million for Lincoln University, the nation’s first college-degree-granting HBCU.
• The budget also increases the Pennsylvania State Grant program by $5.9 million through the Pennsylvania Higher Education Assistance Agency (PHEAA) to maintain maximum awards and continues funding Grow PA scholarships to help students pursue affordable postsecondary programs and fill critical in-demand jobs.

Expanding Our Workforce and Meeting Critical Needs for Economic Growth

Governor Shapiro has made workforce development a cornerstone of his Administration, ensuring Pennsylvanians of all ages have the tools and opportunities to succeed. Over the past three years, the Commonwealth increased funding for vo-tech, career and technical education (CTE), and apprenticeship programs by nearly 50 percent — from $118 million to $183 million; registering 231 new pre-apprenticeships and apprenticeships; and enrolling nearly 18,000 new apprentices. More students are taking CTE classes, gaining industry-recognized credentials in fields ranging from welding and nursing to dairy herd management, and preparing for stable, good-paying jobs.

More than 39,000 Pennsylvanians were enrolled in an apprenticeship at one point during Governor Shapiro’s tenure, creating meaningful pathways to stable, family-sustaining jobs. Yet, there is still untapped potential. Over 614,000 adults in Pennsylvania lack a high school degree, and nearly 7,500 are on waiting lists for adult education programs. Many want to advance their careers but need to improve foundational skills like reading, writing, and math. This budget addresses those gaps by investing in adult and family literacy programs, helping more Pennsylvanians gain the tools they need to enter and succeed in the workforce.

• Preparing our Students to Enter the Workforce: The 2026–27 budget continues this progress by investing an additional $18 million in vo-tech, CTE, and apprenticeship programs, supporting high-quality STEM and computer science education, and expanding Schools-to-Work pathways to $7 million, doubling funding for career development programs that bridge the gap between school and employment. Reforms to CTE allow students greater flexibility in completing technical and academic coursework and enable earlier access to national competency exams, accelerating entry into the workforce.
• Supporting Workers at All Stages of Their Careers: The budget also invests in workers at every stage of their careers. This budget increases state funding for the Office of Vocational Rehabilitation (OVR) in the Department of Labor & Industry by $1 million, bringing the total to $49.7 million, to serve more Pennsylvanians with disabilities. This budget also:
  • Increases Industry Partnership grants by $3.5 million, more than doubling total funding to $6.3 million, helping regional networks of business leaders and public leaders address workforce needs in key growth sectors including health care, IT, agriculture, transportation, and manufacturing.
  • Creates a dedicated appropriation for WEDnetPA of $12.5 million to train more than 1.3 million workers, giving Pennsylvania companies the skilled workforce they need to grow and compete.
  • Includes $2 million for the new Career Connect Program to expand internship opportunities statewide, connecting students and job seekers with meaningful work experience and career pathways.
  • Invests an additional $2.5 million for adult and family literacy programs, equipping thousands of Pennsylvanians with the reading, writing, and math skills needed to enter, remain, and advance in the workforce.
• Removing Barriers for Pennsylvanians Re-Entering the Workforce: The 2026–27 budget also supports individuals returning to the workforce after incarceration. It proposes legislation to establish the Prison Industry Enhancement (PIE) Program, which pairs inmates with private industry to provide real-world work experience, develop marketable skills, and increase employability upon release. To further support successful reentry, this budget includes $900,000 to provide Medicaid coverage for those reentering the community and funds infrastructure changes necessary to make Medicaid accessible to them 90 days prior to leaving incarceration.

These investments tap into the Commonwealth’s workforce potential, ensuring all Pennsylvanians have the freedom to chart their own course and the opportunity to succeed.

Building a Strong Child Care and Teacher Workforce

Governor Shapiro believes child care workers are the workforce behind the workforce. High-quality early learning helps children thrive while allowing parents to pursue their careers, yet Pennsylvania continues to face shortages of quality child care providers. Between 2019 and 2024, the state lost 700 child care programs and nearly 41 percent of its workforce — largely due to staffing shortages and low wages — costing the Commonwealth $6.65 billion annually, including $2.4 billion in lost earnings for working mothers.

To address this, the Governor has taken historic steps to support both families, employers, and child care providers. In 2023, he expanded the Child and Dependent Care Enhancement Tax Credit, raising the state match from 30 to 100 percent of the federal credit and increasing the maximum benefit from $630 to $2,100 per family. In 2024, the Employer Child Care Contribution Tax Credit was created, allowing employers to claim up to 30 percent of contributions toward employees’ child care costs. The 2025–26 budget included a $25 million investment in workforce stabilization through recruitment and retention grants, providing approximately 55,000 child care employees with up to $450 in bonuses — and more than 4,300 applications were received when the application window closed in January.

• The 2026-27 budget builds on that success with an additional $10 million, bringing total investment to $35 million for child care workers at licensed providers in the federal Child Care Works Program.
• This budget builds on prior investments to stabilize and grow the child care workforce. It includes an additional $7.5 million for Pre-K Counts and $2 million for Head Start State Supplemental to help providers raise wages and retain staff.

For teachers, last year’s budget reduced teacher certification fees, broadened certification levels, and expanded opportunities for individuals with subject matter expertise to enter the classroom through internships.

• This budget provides an additional $2.5 million for teacher professional development, ensuring educators have the training and tools needed to support students effectively.
• To address Pennsylvania’s teacher shortage and strengthen the educator pipeline, this budget increases funding for student teacher stipends by $5 million, bringing total support to $35 million annually. Administered through PHEAA, these stipends allow aspiring teachers to earn income while completing their full-time classroom training. More than 2,000 student teachers benefited last year, and this budget builds on that progress, helping Pennsylvania attract and retain skilled educators to classrooms across the Commonwealth.

Slashing Permitting, Licensing, and Business Processing Times

From day one, Governor Shapiro has focused on tearing down unnecessary barriers. On his first day in office, he eliminated the college degree requirement for 92 percent of state government jobs. Today, nearly 60 percent of new Commonwealth hires do not have a college degree, and those same principles are guiding permitting, licensing, and certification (PLC) reform statewide.

Pennsylvania now has all 2,400 PLCs catalogued with clear timelines for each and introduced a money-back guarantee, PAyback, if agencies miss deadlines. These reforms eliminated longstanding backlogs — including a 15-year permit backlog at the Department of Environmental Protection — and dramatically reduced wait times for workers and businesses alike. Nurses now receive licenses in days instead of weeks, pharmacists in a single day, and barbers the same day they apply.

Building on this progress, the Shapiro Administration launched the SPEED and SPEED 2.0 reforms, expanding expedited permitting options, increasing transparency through a public permit tracker, PA Permit Fast Track Program, and accelerating reviews for key construction and development projects.

• This budget includes a $3.7 million increase to the Commonwealth Office of Digital Experience (CODE PA) to support those tools, keep projects on track, and drive economic growth.

The Department of State (DOS) has also become a national leader in accountability, cutting licensing and business processing times by an average of 74 percent — even as filings doubled. What once took weeks now takes a single business day.

• To stay competitive, this budget advances landmark licensing reform by removing outdated requirements, converting underutilized licenses to certifications, and conducting a holistic review to align Pennsylvania’s standards with neighboring states — while maintaining rigorous protections for public health and safety.
• This budget proposes more historic licensing reforms that would make the process for Licensed Social Workers to obtain their credentials the easiest licensure experience in the nation, while still maintaining rigorous credentialing standards — ultimately drawing top talent to Pennsylvania.

By eliminating unnecessary red tape and modernizing government, this budget ensures Pennsylvania attracts workers, supports businesses, and puts more qualified people on the job faster — strengthening our workforce and growing the economy.

Finally Increasing the Minimum Wage to Reduce Expenditures and Generate Revenue

Pennsylvania’s minimum wage has been stuck at $7.25 an hour for more than 15 years, falling further behind the cost of living and leaving hundreds of thousands of workers struggling to make ends meet. Every neighboring state has raised its minimum wage,putting Pennsylvania workers at a disadvantage and making it harder for businesses, especially along our borders, to compete for talent. Today, more than half a million Pennsylvanians earn less than $15 an hour, and the purchasing power of the Commonwealth’s minimum wage has eroded by more than 30 percent since 2009, pushing these families closer to poverty.

• The 2026–27 budget once again calls on the General Assembly to raise the minimum wage to $15 an hour beginning January 1, 2027. This commonsense reform would boost consumer spending, reduce turnover for employers, and improve workers’ health and economic stability — while also delivering significant savings for taxpayers.
• By raising wages for nearly 61,000 workers who currently rely on Medicaid and earn less than $15 an hour, the Commonwealth would reduce reliance on public assistance and save an estimated $300 million in the first full year in Medicaid. In addition, higher wages would generate roughly $80 million per year in new revenue, strengthening Pennsylvania’s fiscal position while helping working families get ahead.

Raising the minimum wage isn’t just the right thing to do for workers — it’s a smart economic and budgetary choice that puts more money in people’s pockets, reduces government spending, and helps Pennsylvania compete and grow.

Providing the Mental and Behavioral Health Support People Need, When They Need It

Pennsylvania has built an integrated crisis response system to ensure people experiencing a mental health or substance use crisis can get help quickly — someone to call, someone to respond, and somewhere to go. The 2026–27 budget strengthens that system with targeted investments to expand access, support frontline providers, and ensure reliable, around-the-clock crisis care in every corner of the Commonwealth.

• This budget provides $10 million in dedicated state funding for the 988 crisis hotline — the first such investment in Pennsylvania — recognizing the more than 145,000 calls handled last year by the Commonwealth’s 14 crisis call centers. Additional funding supports 211 Communication Services, ensuring Pennsylvanians can connect to critical resources in moments of need.
• The budget also includes $5 million to sustain walk-in crisis stabilization centers, prioritizing regions with limited access to immediate, in-person care and strengthening collaborations among hospitals, community providers, and local responders.
• To reduce unnecessary institutionalization and help people return safely to their communities, the budget invests $3.2 million in the Community Hospital Integration Projects Program (CHIPP). This funding will support community-based services for individuals with complex needs who no longer require inpatient psychiatric care, freeing up state hospital capacity while improving outcomes for patients.

The budget also advances reforms to make behavioral health care more accessible and affordable. It creates a streamlined pathway for qualified behavioral health providers to join insurance networks, reducing wait times and giving patients greater choice in selecting clinicians who meet their needs. In addition, the budget calls for commonsense consumer protections to ensure direct payments for prescription drugs count toward a Pennsylvanian’s annual out-of-pocket maximums and to guarantee access to “any willing” behavioral health providers, even when they are out of network — delivering more consumer friendly insurance practices and putting money back in Pennsylvanians’ pockets.

These investments build on county mental health services and strengthen Pennsylvania’s crisis system — ensuring help is there when people need it most and reinforcing the Commonwealth’s commitment to protecting communities, families, and kids.

Protecting Our Children Through Child Welfare Enhancements

Too many families with children who have complex medical or behavioral health needs face bifurcated systems. The 2026-27 budget strengthens care coordination and advances a whole-of-government approach that brings together state, county, and local service providers across mental health, child welfare, education, and community services — ensuring there is no wrong door for families seeking support.

The Department of Human Services (DHS)’s ChildLine hotline operates 24/7 to be available to anyone concerned about the safety of children but growing call volumes and emotional nature of the work has strained staff. In Pennsylvania, everyone shares the responsibility of protecting children in our communities from abuse and neglect.

• This budget proposes $658,000 to expand call-taker staffing and provide additional training, giving caseworkers the resources needed to effectively triage calls and properly refer reports as appropriate.
• The Governor is calling on the General Assembly to work together with the Shapiro Administration to update the Child Protective Services Act, so that parents who are trying their best to put food on the table but may fall short aren’t treated the same as a parent who purposefully and intentionally withholds food from a child; that’s abuse.
• The Governor is also calling on the General Assembly to update Pennsylvania’s statute of limitations for child sexual abuse, giving survivors a fair opportunity to seek justice and hold abusers accountable in civil court. Survivors deserve the chance to confront those who harmed them, and reform is critical to strengthening protections for children and ensuring accountability where institutions failed.

Protecting Our Aging Population through Investment and Reforms

Pennsylvania’s older adult population is growing, and the Commonwealth must ensure services are modern, coordinated, and accountable. The 2026–27 budget advances Aging Our Way, PA, a comprehensive strategy to transform services and strengthen support for older adults, people with disabilities, and their caregivers — ensuring they can access the help they need, when and where they need it.

• This budget includes a $3 million investment to modernize PA Link, Pennsylvania’s Aging and Disability Resource Center network. These funds strengthen coordination among Area Agencies on Aging (AAAs) and community members, improve navigation of long-term services and supports, and advance a No Wrong Door System so older adults and caregivers can more easily access assistance.
• The budget also builds on reforms to increase transparency and accountability across AAAs. Investments continue to support the rollout of the Comprehensive Agency Performance Evaluation (CAPE), which standardizes AAA oversight and publicly reports AAA performance in key areas, like protective services, for the first time. To further ensure programs are effectively serving Pennsylvanians, the budget includes $850,000 to expand evaluation and technical assistance for ongoing CAPE assessments, plus $150,000 to modernize data collection and program reporting systems, improving access to information and helping drive continuous improvement across the network.
• The budget also proposes long-overdue updates to the Older Adult Protective Services Act (OAPSA). With reports of abuse — particularly financial exploitation — rising sharply, these reforms strengthen background checks, expand mandatory reporting, modernize outdated provisions, and create new safeguards to prevent fraud and abuse. The Governor’s proposal calls for expanding background check requirements for caregivers; creating a waiver process for determining employment eligibility; updating outdated lists of criminal offenses;  expanding mandatory reporting practices; and creating older adult fatality review teams to identify gaps in the system in the event that abuse results in death.

These investments and reforms give older Pennsylvanians the protections, resources, and support they need to live safely, independently, and age with dignity.

Enacting a Pennsylvania False Claims Act

Under the Shapiro Administration, Pennsylvania has worked hard to ensure public benefits reach the people who truly need them, and to hold bad actors accountable when they don’t.

• The 2026–27 budget builds on that success by calling for a Pennsylvania False Claims Act, giving the Commonwealth additional tools to prevent, investigate, and prosecute waste, fraud, and abuse. This ensures taxpayer dollars are protected, strengthens fiscal accountability, and maximizes resources for Pennsylvanians who rely on critical public services.

Making Life More Affordable for Pennsylvanians by Cutting Taxes, Lowering Energy Costs, and Investing in Critical Infrastructure

Governor Shapiro has made cutting taxes and lowering costs for Pennsylvanians a top priority — cutting taxes seven times since taking office — putting money back in the pockets of seniors, families, and businesses, and delivering real economic relief while federal policies and inaction have driven up the cost of everyday essentials.

Rising costs are real for Pennsylvanians: health insurance premiums have doubled for nearly 500,000 residents, more than 70,000 have dropped coverage, grocery bills keep climbing, and utility costs have risen nearly a third over the last five years. The 2026-27 budget builds on the Shapiro Administration’s work to ease these pressures while strengthening local communities and the Commonwealth’s economy.

At the same time, Governor Shapiro has fought to keep energy prices down, taking action against PJM Interconnection’s broken market rules. By suing PJM and capping energy auction prices, the Governor has saved 67 million consumers across the PJM grid $18 billion, while advocating for reforms to support a more reliable and modern energy grid.

To build on this progress, the 2026–27 budget makes strategic investments to lower costs, continue tax cuts, and increase access to affordable housing, energy, and infrastructure — strengthening Pennsylvania communities and laying the foundation for continued economic growth.

Leading the Way on Reliable, Affordable Energy

Rising energy costs continue to strain household budgets and the broader economy. Governor Shapiro has worked to prevent rate increases, saving consumers billions, and continues to lead bipartisan efforts to extend price caps and reform the grid to lower costs. Utility companies have agreed to improve transparency, remove hidden fees, and expand protections for low-income customers — steps expected to save Pennsylvanians over $500 million annually.

• The budget advances the Governor’s Lightning Plan, reforming permitting and siting laws, updating Alternative Energy Portfolio Standards, and creating new energy generation projects to increase reliability and affordability while creating thousands of jobs.

Modernizing Tax Incentives to Grow the Economy

The Pennsylvania Economic Development for a Growing Economy (PA EDGE) initiative is being updated to ensure businesses can take full advantage of tax credits to create jobs, innovate, and grow key industries — while supporting reliable energy development and strengthening local communities.

The 2026–27 budget proposes several modifications to make these credits more accessible and effective, including:

• Reliable Energy Investment Tax Credit: Converts the Local Resource Manufacturing Tax Credit Program, allowing recipients to use up to $100 million per year per facility for three years, with a focus on bringing new, reliable energy sources onto the grid.
• Semiconductor Manufacturing Tax Credit: Reduces the investment requirement from $200 million to $150 million and lowers the permanent jobs requirement from 800 to 100, making it easier for businesses to participate.
• Pennsylvania Milk Processing Tax Credit: Provides credits for projects investing $50 million or creating 100 jobs in the production of Class I–IV dairy products using Pennsylvania milk, with extra incentives for organic milk projects.
• Regional Clean Hydrogen Tax Credit: Expands eligibility to up to seven regionally dispersed taxpayers per year and lowers qualification thresholds.
• Sustainable Aviation Fuel (SAF) Credit: Allows recipients to claim up to $15 million per year for a $250 million capital investment creating 400 jobs at a SAF production facility.

These updates ensure Pennsylvania remains competitive with surrounding states, attracts investment in advanced manufacturing and energy, and drives job creation — all while supporting a modern, resilient energy grid that lowers costs for businesses and consumers alike.

Building More Safe, Stable, and Affordable Housing

Access to safe, stable, and affordable housing is the foundation of economic opportunity. It helps families thrive, attracts new residents to the Commonwealth, and supports workforce growth and community stability. Yet housing costs continue to rise faster than inflation, putting homeownership and housing security out of reach for too many Pennsylvanians. More than one million households spend over 30 percent of their income on housing, and over half of Pennsylvania’s housing stock is more than 50 years old.

The Shapiro Administration has already taken meaningful action — expanding the Pennsylvania Housing Affordability and Enhancement Fund (PHARE), supporting over 1,000 projects to build or repair more than 8,200 housing units, launching a statewide Right-to-Counsel initiative, piloting the Commonwealth’s first middle-market housing development program, and creating Pennsylvania’s first Housing Action Plan.

The 2026–27 budget builds on that progress with a comprehensive set of investments and reforms to expand housing access, protect renters and homeowners, and strengthen coordination across state government, including:

• Protecting Renters and Promoting Housing Stability: Establishes a statewide cap on rental application fees tied to the actual cost of screening and prohibits fees before a property is viewed; affirms a tenant’s right to terminate a lease due to domestic violence without financial penalty; seals eviction records for individuals who were not actually evicted; and advances fair-chance housing reforms to limit when and how criminal history may be considered in rental decisions.
• Supporting Manufactured Homeowners: Limits annual lot rent increases in manufactured home communities and requires advance notice of increases, protecting residents — many of whom own their homes but rent the land beneath them — from sudden and unaffordable cost spikes.
• Addressing Tangled Titles and Preserving Generational Wealth: Authorizes transfer-on-death deeds for primary residences, providing a streamlined way for homeowners to pass property to heirs, avoid costly probate, access home repair programs, and reduce blight in communities across the Commonwealth.
• Strengthening Housing Coordination and Accountability: Creates a Deputy Secretary for Housing at DCED to coordinate housing policy, oversee implementation of the Housing Action Plan, develop a digital one-stop shop for housing resources, and share model land-use ordinances and best practices with local governments.
• Modernizing Local Planning and Permitting: Updates the Municipalities Planning Code to reduce regulatory barriers to residential development, improve permitting processes, and incentivize county and regional planning that reflects the diverse housing needs of Pennsylvania’s communities.

These actions will expand housing supply, lower costs, and help ensure communities across the Commonwealth remain affordable places to live, work, and grow.

Investing in Critical Infrastructure to Strengthen Communities Across the Commonwealth

The 2026–27 budget makes bold, new investments in the critical infrastructure Pennsylvania needs to compete, grow, and thrive. Central to this effort is the creation of the Pennsylvania Program for Critical Infrastructure Investment — a $1 billion initiative supported through the issuance of general obligation bonds, with proceeds deposited into the Capital Facilities Fund.

This program will provide flexible funding for large, transformative infrastructure projects across the Commonwealth, including bringing new energy generation onto the grid, building and preserving housing, and upgrading school and municipal facilities. This initiative is designed to unlock economic growth and deliver lasting impact for communities.

Affordable energy, modern facilities, and sufficient housing supply are foundational assets that influence where businesses locate and where workers choose to live. With the need for hundreds of thousands of new homes and stronger local infrastructure, Pennsylvania must move at the speed of business. This program gives communities the tools they need to attract investment, retain talent, and build the infrastructure that makes them great places to live, work, and raise a family.

Pennsylvania is on the rise, and this budget keeps doing what’s working. The 2026–27 budget proposal builds on three years of proven progress under Governor Shapiro — investing in education, cutting costs, strengthening public safety, growing the economy, and creating opportunities for all Pennsylvanians — and puts the people of Pennsylvania first, positioning the Commonwealth for long-term growth.

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