Pennsylvania Gov. Josh Shapiro on Tuesday is unveiling a proposed $53.3 billion budget for the coming fiscal year that would use nearly $4.6 billion, or more than half, of the state’s largest reserve fund to balance.
Shapiro’s address before a joint session of the House and Senate in Harrisburg got underway shortly before noon.
In materials released in advance of his address, Shapiro said his budget would continue “historic investments” in education, workforce development, public safety and economic growth.
“The investments we’ve made are paying off,” Shapiro said in prepared remarks.
Shapiro said Pennsylvania is the only state in the Northeast with a growing economy, graduation and school attendance rates are up, violent crime and unemployment are down, and the state is producing more energy than ever before. The governor said private companies have invested more than $39 billion in Pennsylvania during his time in office, creating more than 21,500 jobs.
“What we’re doing, together, is working,” Shapiro said.
Among other goals for the coming fiscal year, Shapiro said he wants to find ways to help make life more affordable for Pennsylvanians who are concerned about the high costs of food, housing and energy.
Shapiro is again calling for the legalization of marijuana for recreational use, increasing the minimum wage to $15, and taxing and regulating video gaming terminals that have become ubiquitous at bars, convenience stores, fraternal clubs and elsewhere.
Shapiro, a Democrat from Montgomery County, has called for such measures in the past, but the Legislature has failed to reach deals on those issues. Democrats hold a slim majority in the House, but Republicans control the Senate.
“As the federal government takes steps to reform its approach to cannabis and other states put in place responsible regulations, Pennsylvania remains stuck in place without commonsense protections and losing out on critical revenue and new businesses to neighboring states,” Shapiro wrote in a budget report, noting every neighboring state aside from West Virginia has legalized marijuana for recreational use.
Shapiro’s budget proposed legalizing recreational marijuana by July 1 and beginning sales by Jan. 1, 2027. His office estimated that doing so could generate $729.4 million for the state in the 2026-27 fiscal year, with $659.6 million coming from license fees, $36.9 million coming from an adult use cannabis tax and $32.9 million coming from sales and use taxes on cannabis sales.
Taxing and regulating video game terminals could generate $765.9 million for the state in the 2026-27 fiscal year, with $743.1 million coming from a 52% tax on the machines’ gross revenues, while raising the minimum wage could generate an extra $53.5 million, according to Shapiro’s office.
This story will be updated.