Josh Shapiro Shakes Up Pennsylvania Politics: 5 Bold Moves That Could Change Everything

Harrisburg, PA—Pennsylvania Gov. Josh Shapiro has signed a $50.1 billion 2025-26 state budget that delivers the largest education boost in a generation, creates a new earned-income tax credit for working families, and shores up the Rainy Day Fund at nearly $8 billion. Passed after months of cross-party negotiations, the spending plan arrives 135 days past the July 1 deadline but earned bipartisan support by pairing record classroom investments with targeted tax relief. Shapiro called the deal “proof that Democrats and Republicans can still get big things done for the people of Pennsylvania.” Key provisions 1. Education: More than $900 million in new funding—$565 million in adequacy grants, $105 million for the Basic Education Formula, $40 million for special-education services, and $125 million for school infrastructure upgrades. Cyber-charter reimbursement reforms are projected to save local districts $175 million. 2. Working Pennsylvanians Tax Credit: Modeled on the federal EITC, the new state credit equals 10 percent of the federal benefit, returning up to $805 per qualifying family and pumping $193 million back into household budgets. 3. Workforce & child care: $25 million for a child-care recruitment and retention fund plus a $7.5 million Pre-K rate increase, addressing roughly 3,000 open early-education positions statewide. 4. Direct-care pay raise: $21 million to lift wages, provide paid time off, and expand insurance options for 8,500 home-care workers serving seniors and adults with disabilities. 5. Economic growth: Additional staff and fast-track permitting authority for DEP’s SPEED program, $20 million for Main Street Matters small-business grants, and new resources to prepare shovel-ready industrial sites. 6. Public safety: Funding for four new State Police cadet classes, a 10 percent jump for violence-prevention grants, and a doubling of Pennsylvania’s disaster-response fund to $40 million. Why it matters • Largest school-aid jump since the 2008 recession, aimed at narrowing court-identified adequacy gaps. • First state-level EITC in Pennsylvania history, potentially reaching nearly one million taxpayers. • Continued phasedown of the Corporate Net Income Tax keeps the commonwealth competitive as Amazon, Rivian, and biotech firms announce major expansions. • Fiscal discipline: a balanced ledger, no broad tax hikes, and one of the nation’s healthiest reserve funds. What’s next Shapiro must present his 2026-27 proposal in February; lawmakers signal that keeping education momentum and accelerating permitting reforms will drive that debate. Meanwhile, agencies have begun distributing funds to districts, child-care centers, and anti-violence nonprofits—money the governor insists “will hit classrooms and communities before the snow melts.”