Enacted Budget – Fiscal Year 2027
Pennsylvania Governor Josh Shapiro signed the state’s budget for fiscal 2027 into law on July 12. The enacted budget provides $50.85 billion in general fund appropriations for fiscal 2027, representing a 3.7 percent increase over fiscal 2026 available spending levels, including supplementals. In June 2026, the Independent Fiscal Office (IFO) estimated general fund revenues of $49.75 billion on a current-law basis, reflecting a 1.9 percent annual increase. The IFO also estimated motor license fund revenues at $3.18 billion (a 2.1 percent decrease), lottery fund revenues at $2.16 billion (a 3.9 percent decrease), and federal funds at $50.13 billion (a 2.2 percent increase). In a budget update prepared post-enactment, the IFO estimated gross revenues of $50.33 billion and net revenues after refunds of $47.75 billion. The enacted budget is projected to increase the rainy day fund balance to $8.11 billion at the end of fiscal 2027.
The fiscal 2027 budget makes significant investments in education, workforce development, economic growth and innovation, behavioral health, and public safety. For K-12 education, the budget provides additional funding through the state’s bipartisan adequacy and tax equity formula, while also increasing funds for basic education and special education. The budget also maintains funding for school infrastructure improvements, mental health and school safety services, universal free breakfast, and menstrual hygiene products for students. For higher education, the budget funds a new performance-based funding formula for Penn State, University of Pittsburgh, and Temple University, while also making investments in student aid programs to improve postsecondary affordability. Workforce initiatives include funding increases for career and technical education, student teacher stipends, and childcare staff recruitment and retention. The budget also creates the Innovate in PA 2.0 program, funded through Insurance Premium Tax Credits, to provide capital for startups, fund clinical trials, and strengthen Pennsylvania’s innovation network. For mental and behavioral health services, the budget provides dedicated funding for the 988 crisis hotline and for mental health walk-in centers. For public safety, the budget funds four additional state police cadet classes, increases support for rape crisis centers, and continues funding for the state’s Violence Intervention and Prevention (VIP) Program and Building Opportunity through out of School Time (BOOST). Other provisions increase support for county child welfare services and nursing homes, assist farmers and invest in agricultural innovation, modernize the state’s Supplemental Nutrition Assistance Program (SNAP), and provide cost-of-living adjustments for certain public-sector retirees who retired before July 2001.