The widespread job losses due directly to the government’s action and its halt of related economic activity has many Pennsylvanians on the brink of financial disaster. However, the state budget is also in tatters. The Independent Fiscal Office (IFO) estimates that Pennsylvania tax receipts will be almost $3 BILLION under pre-COVID-19 projections, and this is their best-case scenario if businesses reopen by April 27th. If businesses remained closed until mid-June, the lost tax revenue increases to $3.7 BILLION.
As we noted a couple of weeks ago, the General Assembly has the power to overturn or alter the Governor’s emergency declaration. The Governor is opposed to reopening any businesses and has so far refused to make public the list of waivers he has granted or denied to employers in the Commonwealth. Governor Wolf also has yet to provide any guidance as to what conditions he is looking for before he determines whether it is “safe” to get back to work.
As noted previously, Senator Doug Mastriano has proposed legislation that would enable some businesses to reopen. A similar effort is underway in the House. On Tuesday, April 7th, they passed SB 613. The legislation contained language identical to Sen Mastriano’s in the Senate. SB 613 also formalizes what businesses are considered essential thanks to the efforts of Representative Dawn Keefer.
Our neighboring states are using the guidelines published by the Cybersecurity and Infrastructure Agency (CISA) to determine what businesses are essential, but Pennsylvania has opted for broader restrictions. For example, Pennsylvania is the only state in the region where construction is no longer permitted, and car dealerships are closed down.
If the Senate passes SB 613, that could change, provided Governor Wolf doesn’t veto the effort to reign in his so-far unfettered authority. SB 613 would require Governor Wolf to adopt CISA guidelines, and also enable businesses that can apply the CDC’s social distancing guidelines to reopen.
Reopening safe and necessary businesses would go a long way to ease the financial burden of many Pennsylvanians. At the same time, it will increase tax collections and reduce the size of the hole the General Assembly has to deal with as they formulate next year’s budget.