Spotlight PA is an independent, nonpartisan, and nonprofit newsroom producing investigative and public-service journalism that holds power to account and drives positive change in Pennsylvania. Sign up for our free newsletters. This article was updated 6:12 p.m. Sunday, July 12, 2026.

HARRISBURG — In a rare Sunday session of the General Assembly, Pennsylvania lawmakers reached agreement on a $50.8 billion state budget for the 2026-27 fiscal year.

The budget was signed by Gov. Josh Shapiro before 6 p.m. Sunday after the Republican-controlled state Senate passed the appropriations bills, House Bill 2400, by a 44-6 vote. The concurrent House vote passed 167-35.

“This is the fourth year in a row where – despite working with one of the only divided legislatures in the country, where we have some really profound differences – we stayed at the table and brought Democrats and Republicans together to get stuff done, again,” Shapiro said Sunday evening.

He later continued, “We managed to find compromise – without compromising our core values.”

The final budget passed 12 days later than the state-mandated deadline of June 30. However, the 12-day delay was a far cry from the 145-day impasse that occurred last year.

The budget will send more money to the state’s poorest schools but fail to address skill games regulation or other pressing policy questions. The deal was cut behind closed doors, and its details were in flux until the final hours.

It will put more than $900 million into education, provide a pension bump to thousands of retired school, state, and emergency response workers who retired before 2001, and require data centers to report their annual energy and water consumption to the state. The plan also preserves the state’s nearly $8 billion rainy day fund — a key priority for Republicans, who control the state Senate.

“No budget is perfect. However, this avoids new or higher taxes on Pennsylvania families and businesses, and protects our Rainy Day Fund,” Rep. Marci Mustello, R-11th, said. “Generally, it’s a win for taxpayers given what was in the governor’s initial proposal.”

Mustello voted in favor of the budget.

The plan preserves the rainy day fund by pulling more than $500 million from off-budget “special” funds and by using some accounting maneuvers such as delaying payments to the state’s Medicaid managed care organizations.

House Appropriations Chair Jordan Harris, D-Philadelphia, told reporters after a committee vote Saturday night that the plan would still ensure that individuals on Medicaid plans receive their healthcare.

“At the end of the day, people get paid. Bills get paid,” Harris said. “Whether it gets paid today or gets paid tomorrow, the bills will get paid.”

The deal allows the state to sell $125 million in tax credits to insurers. Those dollars then subsidize venture capital firms and fund grants for the life sciences and biotechnology industries, under an “Innovate in PA 2.0” program proposed by Gov. Josh Shapiro earlier this year.

This year marks the commonwealth’s fifth straight late budget. They have ranged from minor delays in which policymakers spent a few extra days finalizing details to 100-plus-day impasses that stretched county, school, and nonprofit finances to the limit. While this year’s delay is comparatively short, the pattern of missed deadlines has frustrated local leaders, who face the consequences of a cutoff in state funds.

Leading up to the deal, lawmakers said negotiations were running smoothly because they were not taking big policy swings as they had in the past. The lean final product reflects that.

It will not legalize recreational marijuana, include new recurring funding for mass transit, or boost the state’s minimum wage, as Shapiro and other Democrats had called for. Still, Harris offered: “It's a good budget.”

Also missing from the deal is a regulatory framework and tax on games of skill. A state Supreme Court ruling set an October deadline for lawmakers to act before the devices are subject to seizure.

Shapiro and other lawmakers support taxing skill games, which have proliferated around the state, and have floated plans they say could raise as much as $2 billion in annual revenue.

In the aftermath of the court’s ruling, Senate Republicans called addressing skill games a “ critical piece” of resolving this year’s budget. However, in an interview with WCCS Radio late last month, Senate Majority Leader Joe Pittman, R-Indiana, said that “from a legal standpoint,” lawmakers do not need to act.

“The challenge now is that, given the Supreme Court decision, it’s very clear this is gambling. We have to approach this from the perspective of it being some sort of age-restricted environment,” Pittman said, adding: “Finding that balance I think is going to be one of the biggest challenges we have.”

Butler County’s delegation in the General Assembly was split on this year’s budget package.

In the House, two of Butler County’s representatives -- Tim Bonner, R-17th, and Aaron Bernstine, R-8th, voted no, while Mustello voted yes.

In voting against the budget, Bernstine accused Pennsylvania lawmakers of kicking the can down the road to next year.

“Nearly $3 billion in delayed payments are being used to make this budget appear smaller and more balanced while hiding the true cost of government spending,” Bernstine said in a news release. “Those bills do not disappear. They will still have to be paid by future taxpayers, and Pennsylvanians deserve honesty and transparency when it comes to how their money is being spent. ...This budget relies on the same type of accounting tricks Bernie Madoff used to make the numbers look better than reality.”

In the Senate, Elder Vogel, R-47th, voted yes, while Scott Hutchinson, R-21st, voted no.

In voting yes, Vogel supported the budget’s funding of local agriculture.

“Many of our fruit farmers across the state suffered catastrophic crop losses after the historic freeze earlier this spring, resulting in significant revenue loss,” Vogel said. “This budget has allocated $10 million to assist these farmers in navigating through this crisis.”

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Butler Eagle Staff Writer William Pitts contributed to this report.