Shapiro pitches legal marijuana, regulated skill games in budget with no sales or income tax increase

HARRISBURG -- In his annual budget address Tuesday, Gov. Josh Shapiro unveiled a $48.3 billion spending plan that proposes to significantly increase funding for public education and legalize recreational marijuana.

The Democrat's plan draws on the state's $14 billion in cash reserves, and would use about $2 billion to offset new K-12 and higher education spending. To raise additional revenue, Shapiro wants to tax legal marijuana, and regulate and tax slots-like machines called skill games that are common in bars and restaurants statewide.

Those new dollars would also help pay for additional spending on public transit, economic development, housing, and health care, among other priorities.

"We can't afford not to invest right now," Shapiro said before a crowd in the Capitol rotunda, which is this year's unusual venue for the budget address because of a leak in the state House chamber.

The major spending proposals mark a new chapter for Shapiro, who in his first address proposed keeping costs relatively flat. The new budget pitch does not include taxpayer money for private school vouchers, a key Republican priority that Shapiro championed, then backed off of, during last year's nearly six-month budget fight.

The first-term governor's spending measures could be difficult to herd through Pennsylvania's divided legislature.

Critics say Shapiro's plan, a roughly 7% increase over current general fund spending, isn't sustainable, as it draws on the state's reserves -- a nonrecurring source built up over the past four years due to a mix of federal aid and higher-than-expected tax revenues during the pandemic.

By the administration's own estimates, those reserves will be almost exhausted by 2029, assuming no new major spending in future budgets.

Ahead of Shapiro's speech, which began at 12:30 p.m., Republicans warned that they didn't like what they'd heard so far.

State Senate President Pro Tempore Kim Ward (R., Westmoreland) said the governor's plan is "expensive and light on details. He wants to spend Pennsylvanians’ money like high-taxed states such as California, New York, and Massachusetts. For now, Shapiro's budget is just talk."

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Look for more on Gov. Shapiro’s budget address in tomorrow’s edition of The Express.