PA Finances Over 5 Years; $8 Billion Difference in Revenue Predictions

Pennsylvania’s Republican Senators have a critical eye on the state’s future finances this week.

In a hearing, Senators learned that two government agencies have an $8 billion dollar difference in their predictions for Pennsylvania’s revenues over the next five years.

The difference in predictions comes from the Governors Budget Office and the state’s Independent Fiscal Office (IFO).

This was discussed during a Senate appropriations hearing, where the IFO presented a new report on the state’s financial status.

While Republicans criticized the difference in predictions, Democrats caution that predictions are just that- predictions.

The IFO's future forecast is purposefully based on more negative assumptions. It also did not include some of the revenue sources Shapiro is hoping to create this year with legalizing Cannabis and taxing skill games.

“We’re looking at two different profits forecast. We use the same macro economics provider- S&P Global," said Matthew Knittel, director of the IFO. "We are using a profits number that’s telling us profits will be flat this year. And the executive budget is using a profit measure that says a 5% growth rate.”

There are multiple factors that impact financial predictions, from personal income tax to corporate policies. Elected officials will continue to weigh the needs of this year’s budget with the future of the commonwealth.

Click here for a link to the IFO's report. Click here for a general list of their reports.

The office did also request $2.3 million for their expenses in the 2024/25 budget.