Government Affairs & General Updates
August 16, 2023
1. Pa.’s new labor contracts to cost taxpayers $3.2 billion over four years, fiscal monitor says - The price tag for that new labor contract between Gov. Josh Shapiro’s administration and the biggest of the unions representing state employees projects to $3.2 billion in new costs over the next four years. That’s according to a mandated analysis of the collective bargaining agreement costs by the state’s Independent Fiscal Office. The IFO’s projection is based on the framework deal just ratified by members of American Federation of State, County and Municipal Employees Council 13 - which raises salaries by a total 22.1 percent through the four-year term of the deal - plus an assumption that its terms will be replicated in about a dozen other pacts with smaller unions that typically track the AFSCME deal. The report also accounts for pay raises projected for management and other non-union employees to keep pay scales in order. When all of those deals are layered in, the IFO said Monday, total added costs could add about $650 million per year in new, recurring salary by the year four of the contract, plus $525 million for health insurance, pension costs and other fringe benefits. That’s a total annual hit of $1.175 billion in 2026-27 for a workforce under the governor’s jurisdiction that sat at 55,556 last month.
2. Broadband development authority sets goal of universal broadband coverage by 2029. Pennsylvania's new five-year plan to bring high-speed broadband internet service to more than 330,000 unserved or underserved locations relies on government funding, partnerships and targeting resources to achieve the goal of universal service by 2029. The plan approved by the Pennsylvania Broadband Development Authority (PBDA) last week is key to obtaining $1.1 billion in federal aid during this period available to Pennsylvania through the federal Infrastructure Investment and Jobs Act. "There are more than 276,000 Commonwealth households without internet access and over 52,000 without reliable access," said PBDA executive director Brandon Carson. "The adoption of this plan puts us another step closer to making sure every Pennsylvanian has access to reliable, high-speed internet." The plan now goes to the National Telecommunications and Information Administration (NTIA) for approval. Following NTIA approval, the authority plans to award federal grants to eligible applicants in 2024.
3. IFO documents office's struggles to accurately predict state revenue in recent years. If it seems to you like the state Independent Fiscal Office has been missing the mark on revenue projections in recent years, the IFO says you're right. In a review of its own performance released last week, the IFO notes that while it's revenue projections were pretty much spot on in 2015-16 and 2017-18, the office has struggled to accurately predict revenue in the post-pandemic economy. In 2021-22, the IF0's revenue projection was 13% off and in 2022-23, they missed by 6%. In 2021-22, "Many factors contributed to the forecast error, including: (1) a tight labor market that resulted in very strong wage growth (PIT and SUT), (2) much higher than expected inflation rates (PIT and SUT), (3) unprecedented increases in capital gains and net business profits for tax year 2021 (PIT), (4) the continued moratorium on federal student loan repayments (SUT), (5) higher prices that were pushed forward to consumers (CNIT) and (6) shifts in consumer purchases to higher margin products (CNIT)." In 2022-23, " The forecast error was primarily due to (1) higher than projected non-financial corporate domestic profits (CNIT), (2) the extension of the moratorium on federal student loan repayments (SUT) and (3) historically high general fund balances combined with rapidly rising interest rates (treasury)."
4. Lawmaker proposes fining utility companies for slow responses to accident scenes and directing funding to fire companies. Utility companies would be hit with financial penalties for delayed responses to accident scenes under legislation introduced this week in the state House. State Rep. Clint Owlett, R-Tioga, in a cosponsor memo from June, said House Bill 1620 was inspired by an incident in which volunteer firefighters had to spend 12 hours at an accident scene directing traffic because a telecommunications company didn't promptly send a crew to remove downed lines. Under HB 1620, if the utility doesn't send a crew within 90 minutes, the company will be fined $1,000 per hour with the money going to the local volunteer fire company.
5. Pennsylvania says its digital services revamp is going well It’s been 100 days since Pennsylvania Gov. Josh Shapiro unveiled the Commonwealth Office of Digital Experience, or CODE PA, and in that time, the office has built out its leadership team and set priorities for revamping its digital services offerings, the governor’s office said Tuesday. Shapiro announced that the digital experience team landed on three first projects for overhauling services, including modernizing permitting processes and unifying credentials to access services. The CODE PA office also added six new members from the private sector to lead in-house digital services teams in user expertise, experience research, design, product management and development to streamline the commonwealth’s digital experience. The office’s first project will be working with the Commonwealth’s Department of Environmental Protection to modernize its permitting technology. On the second project CODE PA is partnering with the Pennsylvania Office of Transformation to build an online portal for businesses and residents to request refunds when permits, licenses and certificates are not delivered on time. The third project will collapse the commonwealth’s secure ID verification for digital services into one credential that can be used for every online service the state offers. The office makes good on Shapiro’s promises to modernize Pennsylvania’s government services and create job opportunities in the state. Read More