Dear Friends,
Last week, I shared how our new state budget makes record investments in education, health, and food security. This week, I’d like to highlight how the same budget supports working families, strengthens communities, promotes economic growth, and helps make life a little more affordable for Pennsylvanians. At a time when costs are rising and families are stretching every dollar, this budget provides targeted relief without raising taxes or cutting essential services. It’s a plan that strengthens our workforce, invests in local businesses, and keeps our economy moving forward.
The budget includes $25 million in new funding for the Child Care Worker Retention and Recruitment Initiative. This investment helps stabilize an essential workforce that makes it possible for many parents to stay employed. When our childcare providers are supported, families can count on consistent, high-quality care for their kids, and employers benefit from a more reliable workforce. In our commonwealth, there are currently 3,000 unfilled jobs in childcare which means thousands of closed classrooms.
One of the most important additions to this year’s budget is the new Working Pennsylvanians Tax Credit. Championed by Rep. Sappey, it supports the nearly one million Pennsylvanians who qualify for the federal Earned Income Tax Credit (the “other” EITC, to avoid confusion with the Pennsylvania school funding program). Any household that receives the federal EITC will now automatically receive a state credit equal to 10% of that amount, providing anywhere from $400 to more than $1,000 back at tax time, relief that families can use for groceries, rent, childcare, and other essential expenses.
As Rep. Sappey emphasized, working families across the Commonwealth are struggling to keep up with rising costs, and this credit will help them stay afloat while strengthening local economies and reducing demand on social safety-net programs. She noted that for every dollar returned to families, Pennsylvania sees $4 in economic growth and saves $3 in social spending.
With the adoption of this credit which has already proven successful in 31 other states, Pennsylvania builds on what is widely regarded as the most effective anti-poverty tool of the past 50 years. This initiative, included in the Fiscal Code (Act 45 of 2025), marks a major step in supporting working families and expanding economic opportunity across the Commonwealth.
These initiatives build on Pennsylvania’s Dependent Care Tax Credit and my bill, included in the tax code last year, which created a credit for businesses that cover a portion of employees’ childcare costs.
I’ve previously discussed how the lack of accessible, affordable childcare directly affects Pennsylvania’s workforce and overall economic health. Childcare is a critical part of our economy—not only because it generates its own economic output, but because it allows working parents to stay in their jobs. According to a 2020 U.S. Chamber of Commerce Foundation study, 58% of working parents reported leaving the workforce because they could not find childcare that met their needs. Cost is also a major barrier, with the national average reaching $10,500 per year, forcing many parents to choose between paying for childcare or leaving the workforce. These affordability and access challenges contribute to states losing an estimated $1 billion in economic activity annually.
This lack of childcare options also hurts employers across the Commonwealth. When parents cannot secure reliable care, businesses struggle to hire and retain the workers they need, leading to staffing shortages, reduced hours of operation, and, in some cases, closures. Absenteeism and turnover tied to childcare issues cost employers between $400 million and $3 billion each year.
Initiatives like the new Working Pennsylvanians Tax Credit also build on the targeted relief offered through programs such as the Property Tax/Rent Rebate Program (PTRR). In 2023, the General Assembly worked in a bipartisan manner to strengthen the PTRR program by raising the maximum rebate from $650 to $1,000, increasing income eligibility limits, and tying those limits to annual cost-of-living adjustments.
These changes have provided meaningful additional support to seniors and individuals with disabilities. In 2024, more than 520,000 Pennsylvanians received rebates on property taxes or rent paid, totaling over $318 million— the largest amount the Commonwealth has ever disbursed through this program.
For more information about the PTRR program, please visit the program’s website. If you believe you may be eligible, my office is available to assist with completing PTRR applications, as well as applications for the North Penn and Wissahickon School District rebate programs.
We’re also making sure Pennsylvania continues to be a great place to live, work, and do business. While Pennsylvania has the only economy that’s growing in the northeast, is one of only 16 states growing nationwide, and is in the top 20 for “Best States for Business,” it’s vital that we keep pushing initiatives that bring and help develop businesses in the commonwealth. Through the Department of Community and Economic Development (DCED), the budget funds programs that create jobs, revitalize main streets, and support small business owners. Highlights include:
- $20 million for Main Street Matters, to strengthen downtowns and local business corridors.
- $20 million for Historically Disadvantaged Businesses, expanding opportunity in communities that have too often been left out.
- $17 million for the Ben Franklin Technology Development Authority Fund, which fuels innovation and supports start-ups.
- $8.8 million for BusinessPA, a new effort to market Pennsylvania as a destination for employers and entrepreneurs.
This budget continues to make progress on permitting reform by funding key staff at agencies responsible for processing permits, licenses, and certifications, and by investing in Pennsylvania’s main streets. It expands DEP’s Streamlining Permits for Economic Expansion and Development (SPEED) program created in last year’s budget, to expedite permitting decisions allowing qualified professionals to review certain permits and accelerate the decision-making process. The budget also creates a public tracker and database of all permits involved in the SPEED program and accelerates the time frames for DEP to complete its review of two types of permit applications. Additionally, it provides a $15.8 million increase to hire staff to support these reforms at DEP, which has already reviewed and acted on more than 30,000 permit applications and conducted 88,799 inspections of regulated facilities this year to ensure compliance with environmental laws.
This budget supports a backbone of the state economy Pennsylvania’s agricultural sector. The sector sustains over 600,000 jobs and generates $132 billion in economic output statewide. In addition to the historic investments addressing food insecurity, as I discussed in my previous email, the budget supports agriculture by assisting poultry farmers affected by high-path avian influenza (HPAI) with testing and flock losses. It also invests in projects to modernize the industry, attract new agricultural businesses, and fund a new state laboratory in Western Pennsylvania.
Local governments also benefit. The budget ensures that counties, boroughs, and townships can maintain essential services without raising local taxes or laying off staff. From plowing roads to staffing emergency responders, this plan helps local governments continue serving their communities. Delays in passing a budget had been putting unnecessary pressure on these entities and their budgets.
All these initiatives come with no new taxes, no use of the Rainy Day Fund, and a balanced bottom line. With a projected $200 million year-end balance and more than $7.5 billion in reserves, Pennsylvania remains on a stable financial footing.
This budget aims to make life in Pennsylvania more affordable, create opportunities, and ensure that every community—rural, suburban, or urban—has the tools to grow. It’s proof that we can govern responsibly while still caring for the people who make our Commonwealth strong.
Next week, I’ll wrap up this series by discussing how the budget protects our environment, strengthens public safety, and where we can still do better as we look toward the future.