Gov. Josh Shapiro unveiled his proposed 2026-2027 state budget yesterday, with a total of more than $53.3 billion and over a 5+% increase over the current budget. It does not contain any broad based tax increases and does not contain a municipal fee for Pennsylvania State Police services. Instead it would rely on new taxes from legalizing recreational marijuana and regulating games of skill as financial mechanisms. Even with these new taxes, it still will need to draw down $4.6 billion from the Rainy-Day Fund. 

The budget address touched on many non-budget proposals, such as a ban on cell phones in schools and regulatory oversight of AI companionship for children and the elderly. It talked about increasing energy costs and reiterated the call for his Lightning Plan to bring on more energy generation, reforming permitting and siting laws and diversifying the energy sector to generate more renewable energy. However, he did not specifically mention the RESET Board concept in his speech or his budget summary. PSATS opposes the RESET Board proposal, which would create a state board to make zoning decisions for large energy facilities. 

Shapiro did discuss a proposal to allow data centers to achieve higher levels of state support that take measures to support their local energy grid, environment, and community. Specifics were not provided.  

Shapiro did address housing as expected, stating that he was proposing “bold new steps to reform our zoning laws, build more housing, and protect renters and owners.” He said that building new housing is the most effective way to lower housing costs and that this “starts at the local level, where zoning laws and ordinances vary across our 2,560 municipalities.”  

He called for a catalog of all of the zoning rules in order to “help local governments understand what works best to build more affordable housing.” He also proposed to work with local communities to “modernize the Municipalities Planning Code to build where it makes sense — and cut red tape where it’s unnecessary. It means creating standards for accessory dwelling units, facilitating transit-oriented development, and streamlining mixed-use development on main streets and commercial corridors.” These are all available options today at the discretion of coal governments. It is unclear if Harrisburg intervention will help or hurt local decision-making. 

The Budget in Brief called for appointing a Deputy Secretary for Housing at the state Department of Community and Economic Development to oversee all state housing programs and priorities, including the implementation of Shapiro’s forthcoming Housing Action Plan, as well as a $1 billion bond issue to go towards housing and other needed infrastructure projects. The budget summary further states the division would be tasked with developing a library of model land use ordinances and best practices for local communities. It also calls for modernizing the Municipalities Planning Code to reduce regulatory challenges to residential development and improve local permitting and land use processes. It would also provide financial “incentives” for county and regional planning to comply with the Housing Action Plan.  

Click here to read the budget address and here to read the Budget in Brief and other supporting documents.