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Senate Appropriations Committee Report

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General Fund Revenues End 2018 on Positive Note

General Fund revenue collections for the month of December exceeded the estimate by $70.1 million.  However, General Fund tax revenues were $12.2 million lower than the monthly estimate.  Non-tax revenue was $82.3 million above the estimate, largely as a result of expanded gaming license fee payments and stronger-than-expected Treasury escheats revenue.  Much of the non-tax revenue surplus likely is attributable to timing differences between when the revenue was received and when it was forecasted to be received in the revenue estimate.  As such, the non-tax revenue surplus could diminish in the coming months.  General Fund revenue collections for the first half of the fiscal year are $403.7 million ahead of estimate.

December 2018 General Fund Revenue vs. Monthly Estimate:

General Fund revenue collections of $2.91 billion were above the monthly estimate by $70.1 million, or 2.5%.
General Fund tax revenues were below estimate by $12.2 million, or 0.4%.
Corporation taxes were $87.5 million, or 17.8%, above the estimate.
Sales and use tax collections beat the estimate by $23.2 million, or 2.5%, for the month.
Personal income tax collections were below estimate by $132.5 million, or 12%.
Non-tax revenues exceeded the estimate by $82.3 million.

Fiscal Year 2018-19 vs. the Official Revenue Estimate To-Date:

Total General Fund revenues are $403.7 million, or 2.7%, higher than the Official Revenue Estimate through the month of December.
General Fund tax revenue is $252.7 million, or 1.7%, above estimate.
Corporation taxes are $294.6 million, or 21.6%, above the estimate.
Sales and use taxes (SUT) are $163.2 million, or 3%, above the estimate.
General SUT collections are $116.5 million, or 2.4%, above estimate.
SUT collections on motor vehicle sales are $46.7 million, or 6.6%, higher than the estimate.
Personal income tax (PIT) collections are short of the estimate by $203.4 million, or 3.3%.
Withheld PIT is $44.1 million, or 0.9%, below the estimate.
Non-withheld PIT (annual & estimated payments) is $159.3 million, or 16%, short of estimate.
Non-tax revenues are $151 million, or 73.8%, higher than the estimate.

Fiscal Year 2018-19 vs. Fiscal Year 2017-18:

Total General Fund revenues through December are $1.04 billion, or 7.3%, higher than last year at this time.
General Fund tax revenue is $934.7 million, or 6.7%, higher than last year.
Corporation taxes are $356.2 million, or 27.4%, higher.
Sales and use tax collections are $422.7 million, or 8.1%, higher than last year through December.
Personal income tax collections exceed last year’s collections by $128.9 million, or 2.2%.
Non-tax revenues are $104.7 million, or 41.8%, more than last fiscal year through December.

Motor License Fund:

Motor License Fund revenues are below the estimate by $36.9 million, or 2.6%, through December.
Motor License Fund revenues are $120.5 million, or 8.1%, less than last fiscal year at this time.

General Fund Budget Mandatory Spending vs. Discretionary Spending 

General Fund spending on mandatory programs has consumed a larger share of the overall Commonwealth budget, increasing from 57% of spending in FY 2014-15 to 59% in this year’s budget.

Mandatory components of the budget include those programs where the Commonwealth has limited ability to reduce spending.  Examples of mandatory programs include federal entitlement programs, such as health care programs for low-income individuals and nursing home care for the elderly; repayment of debt; pension obligations; and funding to operate safe and secure prisons.

Enrollment increases, health care inflation in entitlement programs, growing pension obligations, and additional programming for individuals with intellectual disabilities have driven growth in mandatory components of the budget.  Discretionary programs comprise a smaller share of the Commonwealth’s budget and include grant and subsidy programs for school districts and higher education institutions across the state; agency operating budgets; economic development programs; and support for historic sites and other cultural institutions.  Growth in discretionary spending in recent years has been driven by increases for school districts and higher education institutions across the state.

Low-Income Home Energy Assistance Program (LIHEAP) Season Has Started Enrollment

On October 31st, the Department of Human Services announced the start of the Low-Income Home Energy Assistance Program (LIHEAP) application process for the 2018-19 season.  LIHEAP provides assistance for home heating bills to keep low-income Pennsylvanians warm and safe during the winter months. Assistance is available for renters and homeowners. Crisis and regular LIHEAP applications began November 1, 2018 and end April 12, 2019.

LIHEAP helps families living on low incomes pay their heating bills in the form of a cash grant. Crisis grants are for households in immediate danger of being without heat.  With cash grants, a one-time payment is sent directly to the utility company/fuel provider and will be credited on individuals’ bills. Cash grants range from $200 to $1,000 based on household size, income and fuel type.

During the 2017-18 LIHEAP season, 344,008 households statewide received $115.9 million in LIHEAP cash benefits. These households received an average season benefit of $337.

Eligibility for the 2018-19 LIHEAP season is set at 150 percent of the federal poverty income guidelines. The chart shows the maximum income allowed for eligibility based on household size.

Online applications for LIHEAP can be completed at www.compass.state.pa.us. Paper applications are available through local county assistance offices, or interested applicants can download and print an application from the Department of Human Services’ website.

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