After the $50.8 billion state budget was signed into law, the Pennsylvania Independent Fiscal Office has updated budget calculations for next year.
The IFO says the new budget will be $500 million less than expected but is expecting to see a structural deficit of just over $5 billion. The deficit for this fiscal year will be $2.69 billion.
The state will also make two months’ worth of payments to last year’s budget that will lead to a temporary saving of $2.64 billion across the next two years.
In Governor Josh Shapiro’s original budget, he wanted to use a onetime payment from the “rainy day fund” to pay off the structural deficit. That move would need support from both chambers in Harrisburg but Republican leaders were against taking any funding out of the rainy-day fund.
An updated projection for the yearly budget and deficit to the 2031-32 year will be released by the IFO in November.
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