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Shapiro budget includes $500M focus on industrial sites

As part of his budget proposal for the state’s next fiscal year, Gov. Josh Shapiro is offering a remedy to the shortage of ready-for-business industrial spaces in Pennsylvania.

  • It is a $500 million, bond-funded expansion of PA SITES, a program the governor rolled out last year on a pilot basis with $10 million in funding.
  • The program is inteded to pay for the preparation of industrial sites so they are ready for use by incoming businesses.
  • “Other states literally have pads that are shovel ready,” Shapiro said yesterday in a speech to state lawmakers. “Permits are done, electrical hookups are good to go. It’s time we catch up — and it’s important we start this work now, because it takes years to get some of these sites ready.”

Why is this happening: Usable industrial real estate in Pennsylvania has been in short supply, making it a priority for state and local leaders.

  • Site selectors often skip over Pennsylvania, knowing there is a dearth of available sites, said Abby Smith, president and CEO of Team Pennsylvania, a Harrisburg-based entity that brings together public- and private-sector leaders on economic policy and development.
  • Local officials have a big say in land development, Smith acknowledged. 
  • But, she said, “If the state is making clear that this is how we want to show up, it could make it easier.”

How would it work: Details were vague as of yesterday afternoon.

  • But the general approach would be for the state to float bonds and then repay them using tax revenue generated by new business activity.

What about the rest: Shapiro is proposing a record $48.3 billion in spending overall.

  • The tab includes hundreds of millions of dollars in new funding for public schools, higher education and public transportation.
  • Shapiro also is pushing for more spending on health care and related services, as well as an increase in the minimum wage to $15 per hour.
  • Despite the increases, he added, the budget does not include a request for any tax hikes, largely because it draws on the state’s budget surplus.
  • It does include a call to legalize the recreational use of marijuana, a step that would bring in an estimated $250 million-plus in annual tax revenue.
  • Other economic-development proposals — building on the administration’s recently unveiled plan for economic development — include:
    • $25 million for a new Main Street Matters program to support small businesses and commercial corridors.
    • $20 million in funding for innovation programs.
    • $3.5 million for a regional economic competitiveness challenge.

What’s next: Lawmakers will begin the work of translating the budget into legislative language.

  • A final spending plan should be in place by the end of June. But the process occasionally drags on past the deadline as lawmakers and the governor negotiate the details.
  • Republicans in the legislature were generally critical of the Democratic governor’s opening bid.
  • “Gov. Shapiro’s Fiscal Year 2024-25 budget proposal is unaffordable, irresponsible and misleading,” York-area state Rep. Seth Grove said in a statement. “This budget will bankrupt Pennsylvania’s future and lead to tax hikes within the next four years.”

Gov. Josh Shapiro delivered a budget address on Feb. 6 in the Capitol Rotunda. (photo/submitted)

As part of his budget proposal for the state’s next fiscal year, Gov. Josh Shapiro is offering a remedy to the shortage of ready-for-business industrial spaces in Pennsylvania.

  • It is a $500 million, bond-funded expansion of PA SITES, a program the governor rolled out last year on a pilot basis with $10 million in funding.
  • The program is inteded to pay for the preparation of industrial sites so they are ready for use by incoming businesses.
  • “Other states literally have pads that are shovel ready,” Shapiro said yesterday in a speech to state lawmakers. “Permits are done, electrical hookups are good to go. It’s time we catch up — and it’s important we start this work now, because it takes years to get some of these sites ready.”

Why is this happening: Usable industrial real estate in Pennsylvania has been in short supply, making it a priority for state and local leaders.

  • Site selectors often skip over Pennsylvania, knowing there is a dearth of available sites, said Abby Smith, president and CEO of Team Pennsylvania, a Harrisburg-based entity that brings together public- and private-sector leaders on economic policy and development.
  • Local officials have a big say in land development, Smith acknowledged. 
  • But, she said, “If the state is making clear that this is how we want to show up, it could make it easier.”

How would it work: Details were vague as of yesterday afternoon.

  • But the general approach would be for the state to float bonds and then repay them using tax revenue generated by new business activity.

What about the rest: Shapiro is proposing a record $48.3 billion in spending overall.

  • The tab includes hundreds of millions of dollars in new funding for public schools, higher education and public transportation.
  • Shapiro also is pushing for more spending on health care and related services, as well as an increase in the minimum wage to $15 per hour.
  • Despite the increases, he added, the budget does not include a request for any tax hikes, largely because it draws on the state’s budget surplus.
  • It does include a call to legalize the recreational use of marijuana, a step that would bring in an estimated $250 million-plus in annual tax revenue.
  • Other economic-development proposals — building on the administration’s recently unveiled plan for economic development — include:
    • $25 million for a new Main Street Matters program to support small businesses and commercial corridors.
    • $20 million in funding for innovation programs.
    • $3.5 million for a regional economic competitiveness challenge.

What’s next: Lawmakers will begin the work of translating the budget into legislative language.

  • A final spending plan should be in place by the end of June. But the process occasionally drags on past the deadline as lawmakers and the governor negotiate the details.
  • Republicans in the legislature were generally critical of the Democratic governor’s opening bid.
  • “Gov. Shapiro’s Fiscal Year 2024-25 budget proposal is unaffordable, irresponsible and misleading,” York-area state Rep. Seth Grove said in a statement. “This budget will bankrupt Pennsylvania’s future and lead to tax hikes within the next four years.”

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