DV Journal

Sealing a deal with an old-fashioned handshake may seem like a throwback to a bygone era. After all, does anybody still rely on a handshake promise in an age of lawyers, contracts, and endless documentation?

Well—yes. Under Pennsylvania’s capitol dome, it happens every year. A complex negotiation between the governor and legislative leaders over how to spend tens of billions of taxpayer dollars all boils down to a handshake.

Arguably, that’s how most lawmaking happens. I saw it myself during my eight years as a Pennsylvania state representative. Trust is the coin of the realm, and any colleague foolish enough to break one of those handshake deals—whether a lawmaker or governor—rapidly loses whatever influence they held.

On June 23, Gov. Josh Shapiro appeared on Fox News to defend his support of the proposed Lifeline Scholarship Program. This program, which Shapiro initially supported as a gubernatorial candidate, would provide the funding families desperately need to escape Pennsylvania’s poorest-performing schools. It would allow parents to choose an educational setting that better meets their children’s academic and social needs. Shapiro doubled down on his defense of Lifeline Scholarships, stating that “every child of God” deserves a “quality education.”

With Shapiro using his bully pulpit as governor (alongside the outspoken support from top Senate leaders), it appeared that Lifeline Scholarships were about to become a reality for Pennsylvania’s neediest families as part of the commonwealth’s new budget package. According to the Senate leaders involved in the private negotiations with the governor, Shapiro shook hands on a comprehensive deal, which specifically included carefully crafted legislative tweaks to the Lifeline Scholarship Program, including means testing, a new separate budget line to prevent any impact on existing school funding levels, and a new name—all requested by the governor.

But then the unthinkable happened. At the budget deadline, facing withering political pressure from public sector unions who oppose expanding educational opportunities for even Pennsylvania’s most disadvantaged kids, Shapiro suddenly announced that he would line-item veto the Lifeline Scholarship Program, ironically instructing lawmakers to pass the bill he had advocated and shaped—so that he could veto it!

Shapiro shocked his legislative counterparts by unilaterally blowing up the comprehensive handshake deal. However, Senate leaders still have plenty of leverage and many options to respond accordingly and reset the clock on Lifeline and the other key budget priorities they had negotiated in good faith with Shapiro. Given Shapiro’s breach of their trust, they will treat him warily as the budget impasse he caused extends into July and beyond.

Let’s not forget the real tragedy: Shapiro has put politics above the children trapped in Pennsylvania’s worst failing schools. Lifeline Scholarships are the exit strategy for the tens of thousands of students stuck in the 380 schools that Pennsylvania classifies as “low performing.” In these schools, academic proficiency and attendance are lacking, but violence is abundant. And Shapiro is turning his back on these most vulnerable children.

But it doesn’t have to be that way. Shapiro can still save his credibilty and escape this budget trap he created. More importantly, he can still rescue the kids who fell into this trap with him through no fault of their own. They deserve a Lifeline now more than ever.

The Pennsylvania budget isn’t finished. The current budget impasse could drag on for months. And Shapiro has nothing to veto until the Senate reconvenes, currently scheduled for September. Furthermore, as part of the budget process, the Senate must pass legally required “code bills” that detail how to spend the appropriated budget dollars. Senate leaders have made it clear that Lifeline Scholarships will reemerge in renewed negotiations around those code bills as a part of a package deal that the governor cannot line-item veto—with or without his handshake.

Shapiro is accountable to his constituents—those who trusted and voted for him based on his campaign promises. Moreover, he is accountable to the students trapped in Pennsylvania’s lowest-performing schools whom he promised to help. By fulfilling his promise on Lifeline Scholarships, Shapiro can rescue himself from his negotiating blunders, demonstrate genuine leadership and courage, and regain the trust of his colleagues.

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Despite multiple media reports that the state’s $45.5 billion budget is a done deal, Rep. Seth Grove (R-York) says not so fast.

Grove, Republican appropriations chair, told DVJournal Tuesday that because the Senate leadership has not signed it, the budget is not actually finalized.

Grove laid the blame squarely on Gov. Josh Shapiro, who reneged on his promise to Senate Republicans to fund a $100 million school choice program.

“I call it the great betrayal of Josh Shapiro,” said Grove. “You know, talking about how important school choice is and, ‘All of God’s children need the opportunity for education, blah, blah, blah,’ right?”

“And then, to get the budget out of the House, he commits to line-item veto the school education choice portion of it to get the House Democrats on board,” Grove said. “And the Senate, currently, is not in. They haven’t signed it. So it’s still sitting in the House.”

Asked if there are enough Republicans to pass the Lifeline Scholarships — now known as the PASS program– in the Democrat-controlled House, Grove said there were. “And there’s a lot of House Democrats that have said they support school choice. They just don’t want to bring it up on the House floor for a vote.”

Grove added, “Listen, there was a negotiation between Gov. Josh Shapiro and Senate Republicans. They came to an agreement. Josh was supposed to get House Democrat votes. (The budget needed 102 House votes to pass.) And he never did that. He faced strong opposition from very extreme House Democrats who don’t want to spend 0.2 percent of the budget. That’s what we’re talking about…$100 million out of a $45.55 billion budget in order to help some kids.”

Grove was astonished Shapiro, and the Democrats would block the budget over “a couple of thousand kids [having] the opportunity for academic success and changing their life in a positive way forever. “It’s crazy.”

Grove said the state can make it through the summer without a budget until the Senate returns in September, noting it took nine months to get former Gov. Tom Wolf’s first budget done. School districts will be getting their property tax payments soon, and “They’re sitting on billions of dollars of reserve funds,” Grove said.

Another sticking point is state funding for state-related universities like Penn State.

Grove said it takes two-thirds of the General Assembly to pass that bill because those are “non-preferred appropriations.” Republicans would like a tuition freeze and to have the universities to be subject to right-to-know law for greater transparency.

DVJournal asked Grove whether diversity, equity, and inclusion policies, “which many people see as political boondoggles,” would be included in the transparency.

Grove said he believed that would fall under the right-to-know law.

Asked about the state’s budget surplus, Grove said Pennsylvania has $5.9 billion in the rainy day fund and another $7 billion budget surplus.

“The kind of interesting part is the fact that we’re under a budget impasse. (Because of that) the current fiscal code law requires that 10 percent of the budget surplus be remitted back to the rainy day fund,” Grove said.

The overall budget that had passed had a 6 percent spending increase and included “this robust school choice program for the commonwealth,” he said.

The legislature also has to pass various enabling legislation before the money in the budget can be spent, and it has not done that, said Grove.

With Shapiro’s change of heart on the school choice program, Grove wondered if even members of his own party could trust him now.

“I mean, the simple fact is that (in) Harrisburg, you have one thing. You have the handshake, right? You have an agreement. You have your word. If you don’t have that, you have nothing. So even the House Democrats have to be leery of cutting any kind of negotiation with Josh because at what point is he going to walk away from it for his own benefit?”

Shapiro defended his decision, blaming Senate Republicans during a recent press conference.

“House Democrats made it clear it would not pass their chamber, particularly with the Senate’s unwillingness to advance more of the House’s priorities,” Shapiro said.

Rep. Kristin Marcell (R-Bucks) said, “While there was much in this budget I worked to include and wanted to support – including increased education funding and funding for mental health services — the fact remains that the House majority refused to provide the actual spending plan for the dollars allotted. It means that while a framework for spending was there, it was not ‘locked in’ and can still easily be changed – so those dollars we may believe will be used for priorities we agree upon can still be appropriated elsewhere. That, to me, is bad policy and why I voted no.

“It is also disappointing that the governor refused to fight his party’s leaders and special interests to fulfill his campaign promise and rescue children trapped in failing school districts. I came to Harrisburg ready and willing to work in a bipartisan manner. Sadly, when I attempted to do so, the other side of the aisle not only rejected it, they did so by lying.”

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Pennsylvania Republicans accused Gov. Josh Shapiro of breaking his campaign promises and backing out of a deal to support a scholarship program designed to give low-income children an alternative to poorly-performing schools.

“Senate Republicans worked in good faith with Gov. Shapiro for nearly two months, making concessions and giving him all the goodies he wanted with his promise to work with his party and bring PASS scholarships across the finish line,” said Senate President Pro Tempore Kim Ward. “PASS scholarships have passed both the House and Senate. The outstanding question is, will Gov. Shapiro deliver on his promise, or will he leave Pennsylvania’s most vulnerable kids trapped in failing schools?

“The truth is there was a deal, regardless of what Gov. Shapiro says publicly, and he knows there was a deal,” Ward added.

At issue is $100 million in the state’s new $45.5 billion budget for the Lifeline Scholarship program (now called the Pennsylvania Award for Student Success, or PASS). Shapiro made national headlines two weeks ago when he announced his support for the plan. Now he blames Senate Republicans for not getting the Democratic-controlled House to agree to back the policy.

“House Democrats made it clear it would not pass their chamber, particularly with the Senate’s unwillingness to advance more of the House’s priorities,” Shapiro said at a press conference on Thursday.

As a candidate for governor, Shapiro told parents worried about poor public school performance during the COVID-19 lockdowns that he was a different kind of Democrat.

“School choice is not an ‘either or,’ Shapiro said last fall. “I think this is a ‘both and.’ I think we can invest in public education and empower parents to put their kids in the best opportunity for them to succeed, and I don’t think we have to harm public schools in the process.”

Now he says he is unwilling to hold up the remainder of the budget, which contains many of his priorities, for the sake of the scholarships. House Democrats only agreed to pass the budget thanks to Shapiro’s pledge to line-item-veto the $100 million in scholarship funds.

School choice proponents were outraged.

“Senate Democrats, House Democrats, and Gov. Shapiro did the children of Pennsylvania a great disservice by stopping PASS,” said Cody Harbaugh, executive director of the state Senate Republican Campaign Committee (SRCC). “Subjecting children to failing schools with no other options is wrong.”

National school choice leader Corey DeAngelis had praised Shapiro in the past for his willingness to break with his fellow Democrats on the scholarship issue.

“Josh Shapiro went on Fox News with Dana Perino on June 23, less than two weeks ago, supporting private school choice. He has since turned his back on parents and voters,” DeAngelis said. “This is a bad political calculation by Josh Shapiro. More than 70 percent of parents with school-age children support school choice in Pennsylvania.

“This line-item veto of the school choice proposal he included in his platform is a slap in the face to voters,” DeAngelis added.

Both DeAngelis and Harbaugh also noted many of the Democrats who opposed allowing poor families to use PASS to escape low-performance public schools send their own children to private schools. That includes Shapiro.

“Worse yet are the Senate and House Democrats who opposed this legislation, when they went to private school themselves or send their kids to private school,” Harbaugh said. “Their hypocrisy is a slap in the face to families in underperforming school districts. These hypocrites represent the worst of Harrisburg.”

Philadelphia Democratic Sens. Christine Tartaglione and Sen.  Jimmy Dillon, who attended parochial schools themselves, did not address the hypocrisy issue.

“The budget is supposed to reflect our commonwealth’s moral priorities and aspirations for the future. The bill we voted on (June 30) does nothing to move Pennsylvania forward,” said Tartaglione.

And some 20 percent of Senate Democrats voted against the scholarship program despite benefitting from private education themselves, according to the SRCC.

Several DelVal Republican House members voted for the Democrat-approved budget despite Shapiro’s reversal.

“I voted for the budget in the hope that Gov. Josh Shapiro would decide to keep his original word and not line-item veto the Lifeline Scholarships,” said Rep. Martina White (R-Philadelphia). “I also wanted to prevent another budget impasse that would hurt seniors, children, and those dependent on human services. Since this budget supports our schools and programs for mental health, it’s good for all Pennsylvanians.”

Bucks County Reps. Joe Hogan and Shelby Labs, who voted for the budget, declined to answer questions about their decision to back the Democrats’ budget. Reps. KC Tomlinson (R-Bensalem) and Donna Scheuren (R-Harleysville) have yet to respond to requests for comment.

Meanwhile, Sen. Scott Martin (R-Lancaster) laid the entire blame for the scholarship failure at the feet of the governor.

“Let’s be crystal clear about what transpired over the past several weeks. We negotiated and reached an agreement with Governor Shapiro.

“The Governor informed the House Majority Leader that he and his team would negotiate directly with Senate Republicans to get the final deal. Governor Shapiro’s responsibility was to get House Democrats on board with the deal he negotiated.

He failed spectacularly, and then gutted our agreement. He took the first escape hatch he could find to avoid taking the blame for his failure to lead. It is unconscionable that the governor backed out of our negotiated agreement.”

House Republican Appropriation Chairman Rep. Seth Grove (R-York) said Shapiro’s failure to keep his promise on the Lifeline Scholarships “will result in complete lack of trust between House and Senate Republicans and House Democrats and the governor.”

“House Democrats may pat themselves on the back for stopping $100 million in funding for children stuck in failing school districts,” said Grove. “House Democrats may laud themselves for passing a budget that spends 6 percent over the prior year’s budget, but make no mistake. This is not a complete 2023-24 budget. Completing this task with such deceptive tactics in state government will be extremely difficult.

“Make no mistake. House Republicans will continue fighting for fiscal sanity and children trapped in failing schools,” Grove added.

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Pennsylvania House Democrats passed a $46.4 billion spending plan Monday, which Republicans immediately decried as “unsustainable.” The budget is a 13 percent increase over the current $40.5 billion budget.

Republican House leaders held a press conference to blast the Democrats’ budget bill. They noted state revenue is only growing at 3 percent. They said it would also deplete the state’s Rainy Day Fund and budget surplus.

The bill, which passed along party lines 102-101, is about $1.4 billion higher than the budget requested by fellow Democrat Gov. Josh Shapiro.

“House Democrats today completely broke with their governor, Josh Shapiro, by gutting his budget and replacing it with a bloated spending plan that reflects their unilateral priorities,” House Republican Leader Bryan Cutler (R-Lancaster) said.

“While Gov. Shapiro’s budget was bad enough, Democrats today have increased spending and raised taxes, bloated state government, and rammed through a massive and unsustainable spending plan with only six hours for lawmakers and the public to read it,” Cutler added. “This is not only gross mismanagement and a lack of transparency by House Democrats, but it is the kind of sneak attack politics that the public abhors.”

House Republican Appropriations Chairman Seth Grove (R-York) called the spending plan pushed by House Democratic leadership a “bait and switch” and a “sneak attack” since the Democrats did not share it before an appropriations committee on Monday, the day they also voted to adopt it.

“A simple kitchen-table idea is that you should not spend money you do not have. However, the budget created and forced through the House today by House Democratic leadership not only does that, but it ensures money the state has to save Pennsylvanians from a tax increase will be gone earlier than anyone expected,” Grove said.

“On top of that, this budget continues its attack on small businesses by weaponizing the Department of Labor and Industry, puts Pennsylvania on a path to insolvency, and reflects the one-sided priorities of one legislative caucus,” Gove added. “There is so much in here that Democrats must be ashamed of that they rushed their unilateral spending plan through with only a few hours for Pennsylvanians to see what is in it.”

Grove also said the bill includes about $663 million in revenue from RGGI, the Regional Greenhouse Gas Initiative, a cap-and-trade carbon program. Those costs “raise the cost of energy” for Pennsylvanians and send more money to Harrisburg.

The Pennsylvania Supreme Court currently has a pending case that would block RGGI, which was not approved by the legislature but unilaterally entered into by former Gov. Tom Wolf.

Rep. Kristin Marcell (R-Richboro) said her constituents, especially senior citizens, are worried.

“I heard from many, particularly seniors, who asked if there was anything they could do about the rising cost of cooling their homes in the summer and heating them in the winter,” said Marcell. “I know one thing we cannot do is increase energy taxes in Pennsylvania. The proposed budget includes a $660 million increase in energy taxes, which will be passed onto those who can least afford it.”

“When energy prices rise, families have less money for food, education, health care, and savings,” she said. “Rising energy prices create a ripple effect starting with higher utility bills, that become higher retail costs, all at a time when we are already plagued by inflation fueled by government overspending.”

“Low-income families are particularly vulnerable to the impact of rising energy costs,” she added.

“The reality is we need a sound, comprehensive energy policy that creates a robust economy and continues growing tens of thousands of family-sustaining jobs,” said Marcell. “Raising energy taxes is antithetical to attracting the jobs working families need and encouraging businesses to come here and thrive.”

Also, Grove said the budget does nothing to tackle the problem of “waste, fraud and abuse” in the state’s benefits programs. He noted 40 percent of DHS claims are fraud, waste, and errors.

“It’s the worst of D.C. politics brought to the Pennsylvania House,” he said.

Rep. Craig Williams (R-Chadds Ford) said, “The House Democrats abandoned the Governor’s budget, which they were previously advancing, and added $1 billion in new spending. They also did so in a way that prevented amendment and ran it straight to the House floor for a vote. It is not a sincere effort and will not be our final, negotiated budget. I will be voting for increased spending for our schools, law enforcement, prosecutors, school safety, a new suicide hotline, and property tax relief.”

House Democratic leaders said: “Today, we took a step forward with a budget that puts people first. It makes additional investments in critical programs and services that House Democrats have long prioritized and includes Republican priorities – all in a fiscally responsible way. It’s a plan that further invests in every school district, including extra support for those with the most need and aging infrastructure. It even puts an additional deposit into our Rainy Day Fund.”

Shapiro applauded his Democratic colleagues’ budget.

“We look forward to continuing the negotiation process with the Senate and finalizing a budget that makes strong investments in education, working families, public safety, and communities – all priorities that we can afford.”

“Gov. Shapiro commends the new House Democratic majority for taking this important step forward and adding to our shared priorities as we work to pass a commonsense budget,” said his press secretary Manuel Bonder. “Now, as this process moves on to the Senate, we look forward to continuing to work with Republicans and Democrats alike to bring people together and deliver a budget that addresses the most pressing issues facing our commonwealth.”

The budget bill will next go to the Senate, which has a Republican majority.

“The spending level of the budget passed by the House raises substantial concerns. The Senate Republican Caucus is committed to working to put in place a responsible spending plan that will help strengthen Pennsylvania now and in future years,” said Kate Flessner, a spokeswoman for the Senate Republican Caucus.

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To put it simply, Gov. Josh Shapiro’s proposed budget is hallmarked by irresponsible spending increases and initiatives that will increase costs for Pennsylvanians and likely lead to future tax increases.

While Gov. Shapiro claims his spending plan is $44.4 billion, what he does not include is funding for the State Police, which he moves into a non-transparent offline account.

When one considers that spending, which the Commonwealth will be responsible for and that was taken out of the General Fund, along with expiring COVID federal dollars, total spending in the budget rings in at $45.8 billion, or a $2.5 billion increase that is nearly six percent over last year’s budget.

As a legislature, we will absolutely keep our commitment to law enforcement and ensure police and prosecutors have the resources they need to keep us safe. But the overall irresponsible spending increase and non-transparent funding shifts are what Republicans worked hard to avoid over the last 12 years.

To cover for the increase in spending that is projected this year and carrying over into future fiscal years, Gov. Shapiro has also proposed raiding our hard-earned state reserve accounts that we worked to build up over the years despite trying economic circumstances.

Pennsylvania is blessed to have a significant surplus and a moderately-funded Rainy Day Fund. But under the budget plan and fiscal outlook proposed by Gov. Shapiro, the current surplus will be spent down completely in three years and the Rainy Day Fund fully raided in five years.

Not only does this leave Pennsylvania vulnerable to a sudden economic downturn or some type of emergency that would require unforeseen spending, but if Shapiro’s spending continues along this trend, it will undoubtedly lead to a tax increase on Pennsylvanians while national economic patterns continue to make the cost of living difficult.

Keeping spending in line with revenue is not only constitutionally required, but it is not that hard. Republicans in the legislature, leading on fiscal affairs, avoided the temptation to needlessly increase spending beyond what we could bring in. We did so while still investing more in public education, creating significant reserves, and continuing our support of law enforcement.

There is simply no need for this stark change in direction represented in Gov. Shapiro’s first budget proposal.

To make matters worse for Pennsylvanians, Gov. Shapiro’s budget assumes revenue from the Regional Greenhouse Gas Initiative (RGGI), which is a direct tax on Pennsylvanians’ energy bills and comes at a time when Pennsylvanians have been paying historically high amounts to heat their homes, turn on their lights, and fuel their cars.

While then-candidate Shapiro expressed concern and even lukewarm disapproval of RGGI, now-Gov. Shapiro is supporting this household budget-crushing and job-killing program.

As I said, Pennsylvanians are already paying too high a price for basic, everyday energy resources.

This is even more of a slap in the face given our abundant energy resources in Pennsylvania.

Instead of focusing on producing more of our home-grown energy assets and finding ways to get them to market to reduce our in-state energy costs and those across the country, Gov. Shapiro is literally raising the price of energy and making it more difficult for Pennsylvanians to make ends meet to sustain his irresponsible spending plan.

It is part of a trend in what we have seen from Gov. Shapiro’s largest policy initiative – purporting to say one thing, but actually doing another.

This is further evidenced in his call for permitting reform on one hand – a nod to limited government and making Pennsylvania more appealing to those looking to invest in our communities and workforce – and then hiring an army of labor law investigators on the other, which is a weaponization of our state government to attack our small business job creators in a way not seen since the early days of the COVID pandemic.

Looking ahead, Republicans in the House of Representatives are going to keep our commitment to sound budgeting principles.

We will maintain fiscal responsibility by advocating to keep spending in line with revenues and utilizing what we have to make key investments in growth areas while maintaining our commitment to education, law enforcement, and growing our economy.

We will work within our largest entitlement programs to save taxpayers money while providing those truly needing help with better alternatives.

And we will work toward a limited government that encourages growth, energy production, and the utilization of our strongest home-grown assets.

Pennsylvanians deserve better than having to pay more while receiving less, but that is what they are getting under Gov. Shapiro’s first proposed budget. When House Republicans have a seat at the table, we will fight to ensure taxpayers get the responsible government they deserve and expect.

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