Governor Tom Wolf’s Budget Proposal the 2018 – 2019 Fiscal Year

Remarks by Governor Wolf at 2018 Budget Address
February 06, 2018
2018 Governor’s Budget Address
Harrisburg, PA



Lieutenant Governor Stack, Speaker Turzai, President Scarnati. . .

Leader Corman, Leader Costa, Leader Reed, Leader Dermody. . .

Members of the General Assembly, invited guests, friends and family. . .

And, most importantly, my fellow Pennsylvanians:
Before I begin I want to take a moment to congratulate the Philadelphia Eagles,
the city of Philadelphia, and all of Pennsylvania. I know, just like we’re
sometimes split between parties, we’re also split between Eagles and Steelers
here in the Commonwealth.

But we’re all fans of Pennsylvania and the Eagles and their devoted fans
deserve this moment and we should all be happy to share it.
And now we have seven Super Bowl trophies in Pennsylvania. That’s
something we can all be proud of.

So fly, Eagles, fly.

Just like many of us have so much pride in the Eagles, the story of our
Commonwealth has always been a story about pride. We Pennsylvanians have
always been proud of the work we do. Proud of the industries we’ve built.
Proud of the communities we grow up in, and raise our kids in. Proud of the
traditions we pass down through the generations.

But, by the time I took this office three years ago, the economy had changed –
and the Commonwealth we love was headed in the wrong direction.

When I stood outside this building on that Tuesday afternoon and took the oath
of office as Pennsylvania’s Governor, I talked about what made our
Commonwealth a place we are all so proud to be from.

A place where we build things. A place where you can find work that puts food
on the table and allows you to save up for college or retirement. A place where
you can watch your kids grow up and find jobs of their own – maybe even start
their own business someday and sign the other side of the paycheck.

I believed then, as I believe today, that the people of Pennsylvania have what it
takes to restore those values and rebuild our prosperity. What was standing in
our way wasn’t our work ethic or our entrepreneurial spirit, but a kind of
political paralysis – a status quo in which, too often, politicians in Harrisburg
simply couldn’t find a way to make the tough decisions and smart investments
we would need to get back on track.

So I promised that I would challenge that status quo here in Harrisburg. And
that’s what I’ve tried to do for the last three years.

Sometimes, that’s meant challenging this legislature to step out of its comfort
zone. Sometimes, we’ve worked our way to compromise. Sometimes, I’ve been
forced to move forward on my own.

We still have a lot of work to do. By taking on the status quo here in
Harrisburg, we’ve already begun to write a new story for our Commonwealth.
Not a story about a past we’ll never get back. But a story about a brighter future
we can build together – if we can muster up the political will to do it.

So today, I’m here to challenge you to join me in writing the next chapter of
that proud story.

Schools that teach, jobs that pay.

Where else could the story of Pennsylvania’s future begin than in our schools?
Long before I was Governor, I was a parent who knew that nothing is more
important than being able to give your child the opportunity that comes with a
great education. I was also a business owner who knew that nothing is more
important than being able to find qualified employees.

And so I knew that we couldn’t bring back our economy until we brought back
our public education system. I knew that businesses would not invest in
Pennsylvania until Pennsylvania invested in its schools.

That’s why the first thing I did when I got to Harrisburg was to draw a line in
the sand on education. Over the last three years, we’ve invested in our schools
and reversed the billion dollars in cuts that were made under the previous
administration, cuts that led to larger class sizes, mass layoffs of educators, and
cuts to programs like full-day kindergarten.

And we’ve already begun to see those investments pay off.

Today, we have nearly 100,000 students enrolled in full-day kindergarten, and
we’ve increased the number of kids able to attend pre-kindergarten by nearly

Our high school graduation rate is more than 86 percent, making us a national
leader. We’re second in the nation in STEM education, preparing our children
for the jobs of tomorrow. And we’ve increased the number of career and
technical education students earning industry-recognized certificates by nearly
33 percent, preparing them for the jobs our employers are trying to fill right

Rebuilding our schools is the beginning of rebuilding our economy – but it’s
just the beginning.

For three years now, we’ve been working to create more jobs that pay in every
corner of our state.

Since I took office, Pennsylvania has gained nearly 180,000 jobs. And in the
last year, we led our region in job growth. Many of these jobs are from direct
investment by the commonwealth. For example, the investments we’ve made in
the Shell Cracker Plant, the port of Philadelphia, the online retailer in Paoli,
and the steel plant in Johnstown are on pace to create more than 15,000 jobs.
The workforce development partnerships we’ve forged are on pace to train
thousands of workers for jobs that are sitting open right now.

Over the last three years, we’ve repaired or rebuilt 1,600 bridges, and more
than 18,000 miles of roadways. And over the next decade, we’re going to invest
$2 billion more in rebuilding roads, highways, and bridges across our
Commonwealth so that our people can get to work and our products can get to

It is for these reasons that I think a company like Amazon is considering
Philadelphia or Pittsburgh as the location of its second headquarters.
Businesses don’t invest in states that don’t invest in education, infrastructure or
job training. We’re doing all of these things, and I am hopeful Amazon will
come here, build here, and expand here.

Meanwhile, we’ve also gotten rid of burdensome taxes like the Capital Stock
and Franchise Tax, cut red tape that made it harder to build a small business,
and streamlined the services we offer so that our government can be an ally, not
an obstacle, for entrepreneurs looking to get started right here in Pennsylvania.
In fact, this week, we followed through on a promise I made last year by
launching a one-stop shop for businesses and business owners to access state

There’s more to do, from expanding access to the internet to every corner of the
Commonwealth to a new workforce program called PA Smart that will
consolidate our workforce development efforts into another one-stop shop.
And speaking of our workforce, in this year’s budget, I’m proposing another
major step forward: a significant investment in career and technical education
to help make Pennsylvania a better place to learn, a better place to work – and a
better place to do business.

Developing a workforce that can compete and win in the 21st-century economy
is the single best way to help Pennsylvania businesses grow – and attract new
businesses to our Commonwealth.

It’s also the single best thing we can do to help more of our people find better
jobs – not just tomorrow, but today.

Indeed, these aren’t just jobs, but careers – everything from welding and
machining to coding and advanced manufacturing – careers that can sustain
families and enrich communities.

And these careers aren’t reserved for people with four-year degrees. Anyone in
our state who’s willing to put in an honest day’s work deserves a shot to make a
good living – and by investing in these programs, we can give them a chance to
gain the skills they need to do it.

For example, at LCR Embedded Systems in Norristown, there’s a man named
Michael Rosenberger – who is here today – who works on the manufacturing
line, servicing a major contract. Eight years ago, he would never have expected
to be in that high-level advanced manufacturing position. He didn’t have a
college degree, and he was working at the plant as a janitor.

But Michael was a great employee – a smart guy who took the work he did to
heart, no matter what it was. And he wanted to do more than just collect a
paycheck. He wanted to build a career making things right here in
Pennsylvania. So, thanks to a workforce training program through the
Department of Community and Economic Development, he was able to get
additional training at Montgomery County Community College.

With his new skills, he was able to move up to the assembly floor. And then he
got promoted again, to the machine shop. Here’s a guy who had had no formal
experience in machine shop work until he got this additional training – and,
now, he’s the head of the entire machine shop at LCR, and a role model to his
fellow employees. Michael’s making more money – and making an even
greater contribution, not just to his family and his employer, but to his

There should be a place in Pennsylvania’s future for people like Michael.
There should be a place in Pennsylvania’s future for anyone willing to work
hard to make a better life – and I hope you’re ready to work with me to make
that happen.

Government that works

I’m hopeful because, over the last three years, we’ve begun to see progress in
changing the way things work around here. But I’m also well aware that,
sometimes, progress doesn’t come without a push.

When I took office as Governor, I knew that I had to set a new tone here in
Harrisburg. That’s why I banned anyone in my administration from taking gifts
from lobbyists, I got rid of pay-to-play contracting, I refused to take a salary or
a pension, and I paid for my own health insurance.

But the people of Pennsylvania had a right to expect much more from their
government. Even though they elected a Democratic Governor and a
Republican legislature, they expected all of us to find ways to work together for
Pennsylvania – and they expected us to deliver results.

Now, it has always been, and will always be, my preference to work with the
legislature. When we’ve found ways to do that, we’ve been able to get a lot
done for the people of Pennsylvania.

That’s how we expanded our response to the opioid crisis, arming law
enforcement with the tools they need to fight this epidemic on the front lines
and helping thousands of people struggling with addiction get access to the
treatment that could save their lives.

Working together, we’ve reduced the prison population, while lowering
Pennsylvania’s crime rates. Despite this, our cities still face issues of violence,
and we need to work together – legislators, the administration, and Attorney
General Shapiro – to make our cities and communities safer so violence is
never an obstacle to opportunity.

Working together is how we enacted a fair funding formula in our education
system that takes politics out of school funding and makes sure that your zip
code doesn’t determine what kind of education you can get.
That’s how we solved one of the thorniest problems in Harrisburg – reforming
our pension system in a way that’s fair to our workers and fair to our taxpayers,
so we can stop wasting so much money on Wall Street fees, meet our
obligations, and start paying down our debt.

That’s how we finally made medical marijuana legal so that patients in our
state can get access to the medicine they need to live without pain.

And that’s how, at long, long last, we reformed our liquor system.

And when some in the legislature haven’t mustered up the political will to work
with me, I have no problem doing the work on my own.

Whether it’s expanding Medicaid to cover 715,000 Pennsylvanians, and cutting
our uninsured rate to the lowest it’s ever been, expanding opportunities for
seniors to stay in their homes while they get the care they need as they age, or
streamlining agencies in state government, I have done things on my own to
help the people of Pennsylvania.

But Harrisburg works better – Pennsylvania works better – when we work
together to make it work for everyone.

This year’s budget

When it comes to this year’s budget, working together will be easier than in
years past, because, after decades of neglect and years of crisis, we have finally
begun to tame the fiscal beast that haunts Harrisburg.

No one here needs reminding that Harrisburg’s chronic inability to deal with
that crisis has long been the most visible symbol of what’s wrong with our
state’s government. And I’m proud that we’ve begun to change that story.
Some of the work, I’ve been able to do from the Governor’s office. Taking a
business owner’s approach to our budget, we were able to tighten our belts,
cutting $2 billion by streamlining our bureaucracy and saving Pennsylvanians
another $700 million by cracking down on fraud and abuse.

Some of the work, we’ve been able to do together, like making full pension
payments, reforming our criminal justice system to reduce our prison
population, and lowering health care costs.

And because we’ve begun to take a new approach to our budget, I can come
before you today with a budget that makes the investments we need to continue
our progress without any tax increases on Pennsylvania families.

I’m going to keep doing whatever I can to reduce costs and streamline
government. But we can do so much more to improve our fiscal future if we
work together. And that brings us to the severance tax.

Pennsylvania is one of the few states fortunate enough to have abundant natural
gas resources. And yet we are the only one of those states without a severance

Everywhere else – Texas, Oklahoma, Louisiana, Alaska – they’re bringing in
billions of dollars from the oil and gas industries. That money’s going to fix
roads, build schools, and keep taxes low.

And let’s understand exactly what a severance tax is. It’s a tax paid by people
mostly outside of Pennsylvania to use our natural resources. And by failing to
put in place this commonsense tax, we’re actually just paying other states’
taxes – when we fill up our cars, or heat our homes – we’re paying for Alaska’s
schools and Texas’ roads. I don’t know about you, but I don’t remember getting
a thank you note from anyone in Alaska or Texas.

Pennsylvania is blowing most other states out of the water when it comes to
production. And by joining every other gas-producing state and passing a
severance tax, we could also join them by bringing billions into our own
coffers. Ask these oil and gas behemoths to pay their fair share for extracting
Pennsylvania’s bountiful resources, and we can build a brighter future for

Folks: This is only hard if politicians choose to make it hard.
So why isn’t it done? Well, the truth is, as rich as our Commonwealth is in
some natural resources, special interests have put political courage in short

Look, I get it. The oil and gas industry, they’re powerful.
But in the time I’ve been here, I’ve seen people in this legislature – even people
I disagree with about pretty much everything – set politics aside to do what’s

I believe you have it in you to do it again. Pennsylvania is counting on you to
do it again.

So, today, I’m not just asking you, but challenging you, to do the right thing
and pass a severance tax this year – so we can keep making the investments that
will grow our economy, keep making progress on the issues Pennsylvanians
care about, and keep writing the proud story of a brighter future for our


After all, the Pennsylvania we all are so proud of – the place where you could
work hard and earn a good living, raise your family in a strong community,
watch your kids find opportunity of their own – it wasn’t magically bestowed
upon us. It was built, by generations of people who did hard things, together.
Now it’s our turn.

It’s our turn to make the tough decisions with courage and conviction.
It’s our turn to invest in new technologies, inspire new discoveries, and
incubate new industries.

It’s our turn to build a stronger and fairer economy; healthier and safer
communities; and new opportunities for the next generation.
It’s our turn to finish writing the next chapter in the story of this great

I have never been more proud to be a Pennsylvanian. I have never been more
confident of our people. I have never been more hopeful of our future.
And if you feel the same way, consider this budget proposal an invitation to
join me in building that future, together.

Thank you.