PSBA Legislative Report
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April 9, 2020 

PSBA's advocacy work remains strong through COVID-19 crisis
The following is a message to members from PSBA Chief Advocacy Officer John Callahan.

We live in interesting times and that is certainly true when it comes to legislative action. Your PSBA lobbyists are in regular contact with legislators. We are monitoring and taking action to halt legislation that could set public education back and promote solutions to get us through this crisis. Operating in this new virtual world has not stopped us from being at the table for key discussions. I want to thank you for reaching out to legislators this week; your impact was felt and made a difference. We need to continue positive communication with our legislators now more than ever before.

Thank you for your advocacy efforts!


Schools to remain closed for remainder of the academic year

This morning Governor Tom Wolf ordered all K-12 schools and programs, public and private, to be closed through the end of the 2019-20 academic year. Pennsylvania Pre-K Counts, Head Start Supplemental Assistance Programs and Preschool Early Intervention programs will also remain closed, and institutions of higher education are prohibited from offering in-person instruction. Students and families can continue to pick up meals at designated sites. Under the state's directive, schools could begin summer programming on the day after their academic year ends. All re-openings will be contingent on public health guidance provided by the Secretary of Health and stay-at-home orders issued by the governor. Read the news release.



PSBA, grassroots efforts thwart property tax freeze plan

This week the General Assembly, particularly the House of Representatives, engaged in serious discussions regarding implementing a school property tax freeze for the next fiscal year in response to the COVID-19 crisis. The idea was to amend the tax freeze provisions into an existing bill that was already positioned on the House floor to move quickly. Such a freeze would have an extremely negative impact on school district budgets and planning, especially given the uncertainty surrounding how current economic conditions will negatively impact local revenue and future state appropriations. 

PSBA, partnering with the PA Association of School Business Administrators (PASBO) and the PA State Education Association (PSEA), swiftly responded by sending a joint letter of opposition to any proposal that would freeze school property taxes.

PSBA also sent a Special Legislative Report this week asking school leaders to contact their legislators and explain the challenges, successes and unexpected expenses in providing instruction and services to students and families. 

Our association and grassroots efforts were successful as it appears that a property tax freeze plan is no longer being considered for now. However, this issue may return, and we need to remain vigilant and continue to voice our concerns and opposition with legislators. PSBA is also continuing conversations with legislators about other, less destructive ways to address property tax concerns resulting from the impact of COVID-19.


IFO projects deficit of up to $1.8 billion as fiscal year closes

When the 2019-20 fiscal year closes on June 30 and legislators face the deadline for a new state budget, Pennsylvania could be facing a loss of tax revenue of up to $1.8 billion due to shutdowns related the COVID-19 crisis, according to a new analysis released this week by the Independent Fiscal Office (IFO).  A preview of estimates for fiscal year 2020-21 shows a revenue loss of up to $3.9 billion.

The projected deficits will greatly impact the tough decisions that will have to be made as the governor and the General Assembly craft the 2020-21 state budget. It is unknown whether the governor will revise the budget requests he made in February, or how the loss of state funds will drive budget negotiations.

The IFO's estimates represent potential outcomes based on the length of mandated business closures under two scenarios: Scenario 1 is a best-case six-week closure that ends April 27 and Scenario 2 assumes a ten-week closure that ends May 25. For FY 2019-20, the analysis projects a loss of revenues by $1.3 billion under Scenario 1 and by $1.8 billion under Scenario 2.  Looking over the next 15 months (FY 2019-20 and FY 2020-21 combined), revenues drop under Scenario 1 by $2.7 billion and by $3.9 billion under Scenario 2. The IFO will revisit these assumptions in its next report on May 20.

It's important for school officials to continue conversations with their legislators. Remind them of the accomplishments your district is achieving during this time of crisis, and the challenges and unexpected costs your district is incurring to provide continuity of education and services to students.


 Latest News
Passed by the Senate
  Passed by the Senate  
  Senate passes COVID-19 provisions  
  This week the Senate amended and passed Senate Bill 841 with numerous provisions related to the COVID-19 crisis. The bill, which as introduced provides for the state Health Care Cost Containment Council, had been back in the Senate for a concurrence vote on non-COVID-19 related amendments added by the House. Senate Bill 841 is now back in the House for a vote on the measure as amended by the Senate.

Areas of interest to school officials under Senate Bill 841:
Property tax discount rates and waivers: Local taxing entities may extend the discount rate for property taxes and waive fees and penalties if paid in full by December 31.  School districts are not included and not impacted under this language.
Contracted services: Allows school entities to renegotiate a contract with contract service providers to ensure personnel and fixed costs, including administrative and equipment, are maintained during school closure. The contractor would then need to provide weekly documentation to the school entity that its complement levels remain at or above the level it was on March 13. This is an option, not a requirement for school entities.
Conducting business remotely: Establishes provisions for local governments to conduct business remotely using technology during this time of emergency. There are specific requirements and guidance also provided for conducting business during this time period. This language does not apply to school boards. PSBA worked with the Senate to ensure that this provision would not apply to school boards because they already have the authority to conduct business remotely.
EITC program adjustments: Businesses that were supposed to make a donation 60 days following approval of their tax credit application would have until the end of their tax year.  It further provides that businesses in a two-year commitment that were affected by the COVID-19 crisis will still get tax credits for 90% of their year 2 donation even if it is less than the year 1 donation.