Category: Pennsylvania News

The turning point in Pennsylvania’s budget impasse, by Gov. Josh Shapiro’s telling, came just before Halloween, when he and leaders in Harrisburg gathered in his stately, wood-paneled office to meet twice daily to hash out a deal to end the bitter, monthslong stalemate.

The long grind eventually led to compromises 135 days in, and a deal Shapiro said he thinks is far better than what national Democrats, hoping to extend healthcare subsidies, got in Washington at the end of the federal shutdown.

“Sometimes you’ve got to show that you’re willing to stay at the table and fight and bring people together in order to deliver,” Shapiro told The Inquirer in an interview Friday, touting the state budget agreement finally signed that week.

“I think it’s a stark contrast, frankly, with what happened in D.C., where they didn’t stay at the table, they didn’t fight, and they got nothing,” he said.

Washington is controlled by Republicans, while in Pennsylvania, Democrats control the state House and governorship, and Republicans hold a majority in the Senate.

Both state and federal budgets were signed the same day, offering Pennsylvanians relief from more than a month of government dysfunction at two levels. But for Shapiro — an exceedingly popular Democratic governor facing reelection in 2026 as whispers swirl over his potential 2028 presidential ambitions — the moment was bigger than a procedural win. In the end, Shapiro, preaching his oft-used slogan of “getting things done,” cast the outcome as proof he can muscle through gridlock of a divided legislature, cut deals under pressure, and hold firm where others cave.

So what if it took almost five months? Shapiro argues. At least he didn’t fold.

“I would have hoped to have gotten this budget done, you know, 100 or so days earlier,” Shapiro said, putting pen to paper in the state Capitol building’s baroque reception room last week. “But I think what you also saw was the result of having the courage to stay at the table and keep fighting for what you believe in. And we got a lot more than we gave in this budget.”

As Shapiro portrays the outcome of Pennsylvania’s 2025 state budget as an across-the-board victory, the path to get there was harder and messier than he would have liked: a nearly five-month slog that strained his dealmaker image and forced concessions to get the deal across the line — including no new money for mass transit. The absence of a new funding stream in the budget marked a final blow in the saga to Southeastern Pennsylvania commuters who rely on SEPTA — and who are likely to be reminded of the beleaguered agency’s funding woes as delays, staffing issues, and needed repairs persist.

Critics are quick to note it took the self-proclaimed dealmaker so long to get a deal. Counties, school districts, and nonprofits struggled through four months without state payments while officials remained at loggerheads. Pennsylvania was the last state in the nation to pass a spending plan for the 2025-26 fiscal year.

“He’s five months late. He’s the governor of the fifth-biggest state in the country and the last state to get a budget done,” GOP consultant Vince Galko said. “It’s not a failing grade because it got done, but it’s still a D.”

‘A tremendous cost’

The $50.1 billion budget includes several key priorities for Shapiro and Democrats: significant increases in public education funding, a new tax credit for lower- and middle-income residents, continuation of a popular student-teacher stipend, and other economic and workforce development initiatives.

House Speaker Joanna McClinton (D., Philadelphia) heaped praise on Shapiro during a Monday news conference celebrating the budget’s new Working Pennsylvanians tax credit. “I am grateful that here in Harrisburg we have a hero among us for working families, and his name is Josh Shapiro.”

But the spending plan also fails to find a long-term revenue source for mass transit — a top Democratic priority that dominated debate in Harrisburg for weeks during the budget impasse and kicked up the state’s rural-urban divide. Shapiro ultimately removed mass transit from the negotiating table in September and approved his third short-term fix to keep SEPTA afloat. SEPTA and transit agencies across the state say they are still floundering.

Shapiro last week called funding mass transit “unfinished business,” and top House Democrats maintain it’s a top priority for them heading into America’s 250th anniversary in 2026. Senate Republicans, for their part, were proud to not give in to a mass transit deal they didn’t like, even when advocates and Democrats unleashed intense political pressure on them to buckle, the two top Senate GOP leaders said in interviews.

State Sen. Nikil Saval, a progressive lawmaker who represents part of Philadelphia, was one of a handful of Democrats to vote against the bipartisan Pennsylvania budget bill that was largely lauded by Democrats and Republicans in Harrisburg and beyond. Saval applauded the school funding, anti-violence grant funding, and childcare support but slammed the absence of transit funding and Democrats’ agreement to end their pursuit to join a key climate program.

“Unfortunately, it comes at this tremendous cost,” he said. And ultimately, Saval said, the finished product didn’t seem to justify the time it took to get there.

It was not just transit funding that took a back seat to get the budget deal over the line. To the delight of Republicans — and the chagrin of some progressive Democrats and the climate-conscious — the deal also pulled the state out of the Regional Greenhouse Gas Initiative, a cooperative among states to reduce carbon emissions.

For Shapiro, ending the state’s effort to join RGGI, a program of which he has long been skeptical, was hardly a political loss. It mirrored the path of other blue-state governors who are prioritizing economic headwinds over President Joe Biden-era climate and clean energy policies. In remarks made before signing the budget deal Wednesday, Shapiro said it also removed a hurdle in negotiations.

“For years, the Republicans who have led the Senate have used RGGI as an excuse to stall substantive conversations about energy,” Shapiro said. “Today, that excuse is gone.”

The powerful Pennsylvania Building and Construction Trades Council had lobbied heavily for lawmakers to walk away from the initiative, and it was a top win for state Republicans, who have long said the state should not join the multistate cap-and-trade emissions program they see as hamstringing Pennsylvania’s energy industry from accessing the state’s plentiful natural resources.

‘Two-a-days’

Shapiro said he spent months “running back and forth” to broker a deal between Senate Majority Leader Joe Pittman (R., Indiana) and House Majority Leader Matt Bradford (D., Montgomery). The three met on-and-off in private talks, attempting to hammer out a compromise between the Democratic House and Republican-controlled Senate. But the week of Oct. 27, more than four months into the stalemate, Shapiro said a “breakthrough” finally came when he broadened the talks to include McClinton and Ward.

Minority leaders Rep. Jesse Topper (R., Bedford) and Sen. Jay Costa (D., Allegheny) also joined the group, as it became clear that neither of the tightly controlled chambers would have the votes needed to pass a final budget deal.

The group met twice daily in a conference room in Shapiro’s office. Shapiro, always a fan of the sports metaphor, called the meetings “two-a-days.”

“We would come in the morning, go over the issues. We’d have our homework for a few hours, then come back in the afternoon and talk about, you know, the progress that we made,” Shapiro said. Coming out of that week, the governor said, leaders “had a clear direction on where we were going to go.”

At the negotiating table, Shapiro served as “referee and facilitator” between House Democrats and Senate Republicans, McClinton said in an interview Monday.

“The man is nothing if not dogged and determined,” Bradford said of Shapiro last week.

Two officials in the closed-door talks said Topper’s presence, as the House minority leader who understands House Democrats and Senate Republicans, helped change the dynamic and got leaders on track toward a deal. Other officials in negotiations noted that once the state’s two top leaders — McClinton and Ward, who are both the first women to serve in their roles — the breakthrough deal swiftly came together.

Topper, for his part, didn’t try to take credit for striking the final budget deal, calling himself “a neutral arbiter” and “someone all sides can trust to have an honest dialogue.”

There were other signs of tensions easing as the legislators worked through the fall. Ward, a top critic of Shapiro since he reneged on a promise he made over school vouchers during his first budget negotiations, joined the conversations. The two had not met in person since 2023, and had barely communicated. Suddenly, they were sitting across from one another.

Ward said her criticisms of Shapiro still stand — she wants him to be more transparent, among other disagreements. But she described the conversations as “very cordial, very professional.” And there were moments of levity that helped, said the top Republican leader in the Senate, who is known for her wry humor.

“He did leave me a sugar sprinkle heart [cookie] one day at my seat, and I told him, ‘You know, I’m too old for you, and we’re both married,’” she joked.

Compromise, ‘in this day and age’

As Shapiro looks toward reelection in 2026, his likely opponent — the GOP’s endorsed candidate, State Treasurer Stacy Garrity — is already throwing barbs at the handling of the budget.

“I can’t understand why all these legislators think they did a great job,” she said on The Conservative Voice radio program, breaking with GOP leaders, like Ward and Pittman, who lauded the deal. “… Next year, they’re going to have to dip into the Rainy Day Fund to plug a budget, and then taxes are going to go up.”

Because of how long this budget took to finalize, Shapiro will already need to introduce his next budget in just three months, and in proximity to the 2026 midterms and Pennsylvania governor’s election. But it’s unclear whether those negotiations will be as fraught, given budgets tend to get resolved faster in election years with both parties eager to focus on the campaign trail.

And polling shows Pennsylvania’s governors throughout history have rarely been blamed for budget impasses.

“In this day and age, I would not downplay the fact that there was compromise,” said Berwood Yost, a pollster with Franklin and Marshall College. “People want their problems solved. They want politicians to do things that help their everyday lives and that, for most people, means some kind of compromise. Getting this problem solved fits with his narrative.”

Yost thinks Shapiro’s bigger challenge will be answering rumors about his national ambitions as he tries to run for reelection in Pennsylvania.

Galko, the GOP consultant, looked further ahead to a potential 2028 presidential election. The budget impasse, he said, could provide material for Democratic rivals on the national stage. The possible field is filled with other governors, several from blue states, like Gov. JB Pritzker of Illinois and Gov. Gavin Newsom of California, where in-state dealmaking is easier among a uniform legislature.

“If he’s unable to negotiate with the Pennsylvania Senate, what’s he gonna do when he goes up against China or Russia?” Galko asked, previewing the possible attack.

Ultimately, history suggests Shapiro’s political success is likely to hinge less on the nuts and bolts of a budget only some Pennsylvanians — and even fewer outside Pennsylvania — are familiar with, and more on his ability to bolster his image as a bipartisan governor in a purple state.

On Friday morning in South Philadelphia, Shapiro sported a bomber jacket while posing for selfies with Eagles fans, nodding along to a rock band’s cover of “Santeria” in a tent outside the Xfinity Mobile Arena at an event hosted by radio station WMMR.

Casually, almost as a throwaway line, Shapiro mentioned to radio hosts Preston and Steve during an interview that he planned to bring Michigan Gov. Gretchen Whitmer — a fellow swing-state governor seen, too, as a possible 2028 Democratic contender — as his guest to the Eagles-Lions game at the Linc that Sunday.

“She actually said, ‘Is it OK if I wear Lions stuff?’” Shapiro told the kelly green-clad crowd in Philadelphia, riffing on the friendly football rivalry — the undercurrents of national politics left unspoken. “And I’m like, ‘No problem. You’re on your own in the parking lot. I can’t protect you.’”

The event was a food drive but also served as a tribute to the station’s beloved late host, Pierre Robert. Shapiro brought along a commendation from the governor’s office for the occasion.

“He created community, created joy, brought people together,” Shapiro said of Robert. “You think about just how divided we are as a world, there’s a few things that still bring us together, right?”

“By the way, I’ve learned those lessons. That’s what I try and do governing with a, you know, divided legislature.”

Music and sports, the governor mused before the crowd of Philadelphia fans, are two things that bridge the gap. “Go Birds,” he added with a grin.

Staff writer Katie Bernard contributed to this article.