Provision added to begin phase down and cap of highway funds to the State Police

Last week, the General Assembly finally adopted the supplemental revenue and tax bills to finalize the state budget process for the 2016-17 fiscal year.  In those bills, a provision was added that will slowly phase down the amount of money going from the Motor License Fund (MLF) to the Pennsylvania State Police for its operations.

Senate leadership Inserted into the fiscal code language that would cap the amount of money diverted in this fiscal year for state police operations at $802 million.  The funding will then decrease-starting in 2017-18’s budget-at an annual rate of 4% over the next 10 years until it reaches a cap of $500 million.  

Good News:
For the first time, we have statutory language to cap and begin phasing down the amount of money going from the highway construction and maintenance program to the State Police.  The General Assembly will be obligated to find any future increases in State Police funding from the General Fund or other revenue streams.

Still in Question:
The language enacted this year can be amended or changed by any future action by the General Assembly. The impact of this action on future construction lettings is still uncertain.  PennDOT Secretary Richards, for example, had earlier called for a step down over just three years.

The budget was finalized with the enactment of nearly $1.3 billion in additional spending.  To pay for the additional spending, the General Assembly enacted a tax bill that would: increase the per pack cigarette tax by $1, establish the same tax on loose leaf tobacco and e-cigarettes; increase the bank shares tax; implement the state sales tax on digital downloads; eliminate the sales tax vendor discount; apply personal income tax to lottery winnings; and use revenue from gaming expansion that will be enacted this fall.