Senate of Pennsylvania
SENATE DEMOCRATIC WRAP-UP FOR THE 2005- 2006 Legislative Session
FOR
EDITORIAL BACKGROUND
The two-year 2005-2006 Legislative Session will long be remembered as one of the most bipartisan, innovative and productive in Pennsylvania’s history. Under Gov. Ed Rendell’s leadership, lawmakers tackled numerous problems and issues that had lingered for many years.
One of the session’s hallmark achievements was the passage of a property tax reform measure (See Special Session House Bill 39, Special Session Committee) that will tap the state’s new slots industry to provide significant statewide property tax cuts, make more senior citizens eligible for relief under an expanded Property Tax & Rent Rebate program and give voters in local school districts the flexibility to shift even more of the local tax burden away from homeowners. While numerous lawmakers have said they will work to cut property taxes even more in the coming session, the state’s tax relief law is clearly the first successful property tax cut effort in decades.
Determined to protect the integrity of the state’s budding slots industry, lawmakers made changes to the gaming law that will forbid public officials from having any financial interest in gaming, impose a strict new code of conduct for gaming officials, eliminate suppliers and give the state Attorneys General more power to investigate and prosecute wrongdoing (See Senate Bill 862, State Government).
The two-year session also produced bold new efforts to strengthen Pennsylvania’s economy (See House Bill 1802, Appropriations) and protect the environment (See House Bill 2 and House Bill 3, Environmental Resources and Energy). Lawmakers also made significant investments in education, job training, crime prevention and improving the plight of military personnel and their families (See Veterans Affairs and Emergency Preparedness).
Even with the greater investment in the state’s economy, environment, schools and libraries, lawmakers managed to hold the line on individual taxes, stem the loss of federal medical assistance support and slash business taxes (See House Bill 815 and House Bill 2499, Appropriations).
Much of what was accomplished in the two-year session was overshadowed by a controversial pay raise measure in 2005 that would have hiked salaries for members of the Judiciary, General Assembly and Executive Branch (See House Bill 1521, State Government). The measure was repealed later that year (See House Bill 1956, Rules and Executive Nominations). However, a 2006 state Supreme Court ruling overturned the section of the law that rescinded the judges’ pay raises and reinstated the increases.
Other significant legislative achievements during the 2005-2006 legislative session included making more low-income families eligible for home heating assistance (See House Bill 1539, Finance), raising the state’s minimum wage (See Senate Bill 1090, Labor and Industry), limiting the government’s use of eminent domain (See House Bill 2054 and Senate Bill 881, State Government), making 120,000 more senior citizens eligible for the PACE/PACENET prescription drug benefits (See Senate Bill 1188, Aging and Youth), and providing more children with health insurance coverage (See House Bill 2699, Public Health and Welfare).
Lawmakers also passed new laws that set new ethical standards for lobbyists (See House Bill 700, State Government) and toughened criminal laws against sexual offenders who prey on children (See House Bill 2447, Judiciary).
For the 2006-2007 session, Senate Democrats say they will reintroduce and fight to enact a package of Democratic-sponsored legislative reform proposals that would make the legislative process more open, accessible and accountable.
January 2007
Legislation is coded as follows: a single asterisk indicates Senate passage, two asterisks indicate Senate and House passage, and three asterisks indicate the measure became law. A "V" means the governor vetoed the measure.
*** PACE/PACENET and Medicare Part D Integration -- The Senate unanimously passed Senate Bill 1188, which amends the State Lottery Law to integrate the existing PACE and PACENET programs with the new Medicare Part D prescription drug benefit. It will also hold seniors harmless if they are receiving PACE/PACENET benefits and their Social Security COLA increases their income beyond the eligibility guidelines.
Seniors will no longer have to pay additional premiums on the drugs they currently need and coverage will be extended to an additional 120,000 seniors.
The measure was enacted as Act 111 of 2006.
***The Ounce of Prevention Program -- The Senate unanimously passed House Bill 200. The bill will establish the “Ounce of Prevention Program,” which will provide grants to certain entities that provide home visitation and other services to low-income, at-risk expectant first-time mothers and their newborn children and families.
The bill was enacted as Act 23 of 2006.
***Health Care Facilities Act Amended -- The Senate unanimously passed House Bill 247. The measure will amend the Health Care Facilities Act to provide for definitions of activities of daily living (ADL), home care agency, home care registry, inspection, and instrumental activities of daily living (IADL). In addition, the definition of “home health care agency” is amended to cover services provided in the consumer’s place of residence or “other independent living environment.”
It will also amend the act regarding licensure training and experience, establish certain consumer protections and provides for inspections.
The measure was signed into law as Act 69 of 2006.
***At-Risk Elderly Wireless Emergency Telephone Program -- The Senate unanimously passed House Bill 1326, which established the At-Risk Elderly Wireless Emergency Telephone Program, conferring powers and duties on the Department of Aging and providing additional powers to the Area Agencies on Aging.
The program will provide each local Area Agencies on Aging (AAA) the opportunity to enter into a public-private partnership with wireless telecommunications carriers to provide at-risk elderly person with immediate access to 911 emergency services, as well as the prospective protective services unit. The measure was signed into law as Act 76 of 2006.
*** Resource Family Care Act – The Senate voted 48-2 in favor of House Bill 1579, which gives foster/resource parents more rights and input concerning the children in their care.
Under the Resource Family Care Act, county and private agencies shall be required to:
The bill was enacted as Act 73 of 2005.
*** Child Abuse Investigations – The Senate unanimously passed Senate Bill 86, which allows for the opening of a child abuse investigation in the child’s county of residence, even if the alleged abuse took place outside of Pennsylvania.
The measure also requires that the home county be provided a copy of any child abuse report submitted to another state’s child protective services bureau. The information is to be shared within seven days of the completion of the investigation.
The bill was enacted as Act 43 of 2005.
***Photo Identification Included in Case Files -- The Senate unanimously passed Senate Bill 63. The measure will require caseworkers at county Children and Youth agencies to include photo identification of each child from a family that maintains a case record.
The new law also requires that the photo be included upon the transfer of the record to another jurisdiction.
This measure also provides for an exception to the oral examination for marriage licenses for service members. The exception is if an applicant is unable to appear in person because of his active military service, then he or she shall be permitted to forward and affidavit to the issuing authority.
The bill was signed into law as Act 126 of 2006.
***Children’s Trust Fund Board --The Senate passed Senate Bill 922 with a unanimous vote. The measure will amend the powers and duties of the Children’s Trust Fund Board to accept, either directly or indirectly through a nonprofit corporation, federal funds, gifts and donations from individuals, private organizations or foundations.
This law will also amend the powers and duties of the Department of Public Welfare so that the department secretary or his/her designee will serve as executive director to the board and carry out the duties and responsibilities assigned by the board through staff employed by the department.
The measure was signed into law as Act 177 of 2006.
*** ACRE Initiative By a 49-1 vote, the Senate approved House Bill 1646, also known as the Agriculture Communities and Rural Environment (ACRE) initiative. The legislation is intended to help Pennsylvania farmers avoid drawn-out legal disputes over “factory farms” and other local ordinances.
As part of the ACRE initiative, farm owners and operators will be permitted to request the Attorney General to review any local ordinance disputes. Local governments will be prohibited from adopting or enforcing any local ordinance that is deemed “unauthorized.”
In addition, the adoption of ACRE will make Pennsylvania the first and only state to enforce farm odor mitigation, requiring that all new or expanded Concentrated Animal Feeding Operations (CAFOs) and Concentrated Animal Operations (CAOs) develop an odor management plan with strict water-quality requirements.
The Governor signed the bill into law as Act 38 of 2005.
*** Amendment to Agricultural Area Security Law The Senate voted 47 to 2 in favor of House Bill 619, which specifies that horse farms are eligible for Farmland Preservation benefits.
The newly defined “commercial equine activity” includes boarding and training horses, handling, instruction, riding and grazing. The eligibility does not apply to racetracks.
The term “Agricultural security area” is broadened to include land used for agriculture and also the portion used for equine activity. An agricultural conservation easement that restricts the use of land was amended to say that the use of commercial equine activity does not apply.
The Governor signed the bill into law as Act 61 of 2005.
*** Livestock Regulation By a 49-1 vote, the Senate approved House Bill 1580, which broadens the authority of the Department of Agriculture to make sure animals are healthy and free of any diseases after being hunted.
Under this measure, all deer, moose, reindeer, caribou and hybrids are added to the list of animals the Department of Agriculture can regulate.
The Governor signed the bill into law as Act 51 of 2005.
*** Farmers Markets The Senate voted unanimously on legislation that could bring more farmers markets to Pennsylvanians.
House Bill 2472 creates a grant program designed to encourage the development and expansion of farmers markets. The bill also authorizes the Department of Agriculture to establish standards and procedures to award grants for these programs, with an emphasis placed on underserved areas.
The Governor signed the bill into law as Act 124 of 2006.
* Rural Pennsylvania Revitalization The Senate voted unanimously in favor of Senate Bill 451, which would have changed the Rural Pennsylvania Revitalization Act, which provides money for research of the state’s rural conditions.
The changes would have added the University of Pittsburgh to the list of colleges and universities that are eligible for money. Also, a simple majority would have decided decisions rather than six members, and the maximum amount of money to be given out would have been changed from $50,000 to $60,000. Lastly, the bill would have changed the name of the Pennsylvania Farmers’ Association to the Pennsylvania Farm Bureau and the Pennsylvania Rural Coalition would have been deleted as an organization.
The bill died in the House.
*** Farmland Preservation The Senate voted unanimously in favor of Senate Bill 723.
This bill amends the Agricultural Area Security Law to encourage financial partnerships between state and local governments with local nonprofits to increase the funds available for agricultural conservation easement purchases in the state’s Farmland Preservation Program.
A county has the option of permitting participation by eligible nonprofits and describing the requirements for participation in their county program. A county farmland preservation board must recommend the purchase of an easement jointly with an eligible nonprofit entity.
The Governor signed the bill into law as Act 46 of 2006.
* Domestic Animal Premises Registration The Senate voted 48-1 in favor of Senate Bill 865. This bill would have established a domestic animal premises registration program, which would have required registration of property where domestic animals are kept. The bill died in the House.
* Agricultural Land Conservation The Senate voted unanimously in favor of Senate Bill 940, which would have provided more funds for agricultural land conservation.
Under the bill, the Land Trust Reimbursement Program would have given up to $200,000 to land trusts used for conservation. The program also would have provided the Department of Agriculture proceeds from sales for conservation, and authorized the department to give grants of up to $750,000 to counties for land conservation.
The bill died in the House.
*** Healthy Farms and Healthy Schools The Senate voted unanimously on legislation that educates young children and their caregivers about healthy eating habits and Pennsylvania agriculture, while providing more market opportunities for local farmers.
Senate Bill 1209 creates the Healthy Farms and Healthy Schools program within the Department of Agriculture and establishes grants that are used to administer this program. Any school district, charter school or private school with a kindergarten program is eligible to apply.
The Governor signed the bill into law as Act 184 of 2006.
Fiscal 2005-06:
* * * 2005-06 State Budget -- As a result of Bush Administration-caused reductions in federal support of Medicaid expenditures and the uncontrollable rise in health care costs, sufficient funds were not available to significantly bolster many important state programs or support a general tax cut in the 2005-2006 budget (House Bill 815, Act 1A of 2005).
However, buoyed by Senate Democratic efforts, the $24.15 billion state budget managed to lessen the Bush Administration’s caused Medicaid cuts, hold the line on taxes, hike funding to school districts by $129 million and use $625 million in voter-approved bond funds to make an unprecedented investment in Pennsylvania’s environment.
In his 2005 budget address, Gov. Ed Rendell direly predicted that the state faced a $400 million federal Medicaid funding shortfall that year alone for crucial health services that serve the elderly, disabled and poor. Pennsylvania’s improved economy enabled lawmakers to pare the shortfall down to $200 million.
The final revenue surplus for the General Fund for the 2004-05 fiscal year was $442 million. That extra tax revenue created a $377 million General Fund surplus to begin the 2005-06 fiscal year.
In the spending plan, lawmakers managed to restore all of the Medical Assistance dollars used for prescription drug purchases, and also cover much of hospitals’ ever-increasing uncompensated care costs (see House Bill 1168).
On education (see House Bill 628), in FY ’05-06 all school districts averaged a 3 percent subsidy hike. Plus, supplemental state funds were earmarked for districts that have low per student expenditures to help close the funding gap between school districts. The 2005-06 budget also included a 2.5 percent increase in special education funding and $28 million in supplemental funds for tutoring in grades 8 through 12.
Community Colleges received a 10 percent state funding boost. They were also provided with funding that reimburses them for operating costs based on enrollment in credit and non-credit courses. In addition, community colleges will receive economic development stipends for offering courses that are responsive to business and workforce needs.
Embracing Gov. Ed Rendell’s call to invest in the state’s environment, lawmakers laid out a plan (see House Bill 3, Act 45) to preserve farmland and open spaces; clean up streams, brownfields and abandoned mine sites; repair and prevent landslides and sinkholes; revitalize older communities; and maintain the state’s 3.8 million acres of park, forest and game lands.
The Growing Greener II
program distributes the bond funds approved by the voters in the spring of 2005
for key environmental protection programs. The program also targets $90 million
for counties to use to fund local initiatives.
* * * Redevelopment
Assistance -- The Senate unanimously approved House Bill 1802,
which raised the cap on outstanding obligations for redevelopment assistance
capital projects by $500 million, from $2.150 billion to $2.650 billion. Raising
the total debt limit for redevelopment assistance increases the potential for
the state to incur more debt and associated interest expense for redevelopment
assistance capital projects. At current interest rates, the issuance of an
additional $500 million in bonds would cost approximately $752 million over 20
years. The bill was enacted as Act 87 of 2005.
* * * PUC Appropriation -- The Senate unanimously approved an amended version of House Bill 816 that appropriated $52 million from a restricted General Fund account to the Public Utility Commission for the its 2005-06 operational costs. The bill also appropriated $375,000 in federal funds for the natural pipeline safety and $1.350 million for motor carrier safety. The bill was enacted as Act 39A of 2005.
The following Appropriations bills were all approved unanimously, and enacted:
· House Bill 823 provided for the $692 million capital budget for fiscal 2005-06 (Act 52 of 2005).
· House Bill 824 appropriated $317 million to the Pennsylvania State University (Act 9A of 2005).
· House Bill 825 appropriated $164 million to the University of Pittsburgh (Act 10A of 2005).
· House Bill 826 appropriated $168 million to Temple University (Act 11A of 2005).
· House Bill 827 provided $12.9 million for Lincoln University in Chester County (Act 12A of 2005).
· House Bill 828 appropriated $6.7 million to Drexel University (Act 13Aof 2005).
· House Bill 829 appropriated $44.7 million to the University of Pennsylvania (Act 14A of 2005).
· House Bill 830 appropriated $11.7 million to the Philadelphia Health and Education Corporation (Act 15A of 2005).
· House Bill 831 appropriated $9.5 million to Thomas Jefferson University (Act 16A of 2005).
· House Bill 832 appropriated $4.8 million to the Philadelphia College of Osteopathic Medicine (Act 17A of 2005).
· House Bill 833 appropriated $1.8 million to the Lake Erie College of Osteopathic Medicine (Act 18A of 2005).
· House Bill 834 appropriated $1.4 million to the Pennsylvania College of Optometry (Act 19A of 2005).
· House Bill 835 appropriated $1.2 million to the Pennsylvania University of the Arts (Act 20A of 2005).
· House Bill 836 appropriated $1.5 million to the Bureau Training School (Act 21A of 2005).
· House Bill 837 appropriated $186,000 to the Johnson Technical Institute of Scranton (Act 22A of 2005).
· House Bill 838 appropriated $68,000 to the Williamson Free School (Act 23A of 2005).
· House Bill 839 appropriated $388,000 to the Fox Chase Institute for Cancer Research (Act 24A of 2005).
· House Bill 840 was a $306,000 non-preferred appropriation to the Wistar Institute in Philadelphia for operation and maintenance expenses and AIDS Research (Act 25A of 2005).
· House Bill 841 bill was a $130,000 non-preferred appropriation to the Central Penn Oncology Group (Act 26A of 2005).
· House Bill 842 was a $49,000 non-preferred appropriation to the Lancaster Cleft Palate for outpatient-inpatient treatment (Act 27A of 2005).
· House Bill 843 was a $418,000 non-preferred appropriation to the Burn Foundation, Philadelphia for outpatient and inpatient treatment (Act 28A of 2005).
· House Bill 844 was a $970,000 non-preferred appropriation to the Children’s Institute, Pittsburgh, for the treatment and rehabilitation of certain persons with disabling diseases (Act 29A of 2005).
· House Bill 845 was a $451,000 non-preferred appropriation to the Children’s Hospital of Philadelphia for comprehensive patient care and general maintenance and operation of the hospital (Act 30A of 2005).
· House Bill 846 was a $105,000 non-preferred appropriation to the Beacon Lodge Camp in Mifflin County that serves special needs children and adults (49-1 vote) (Act 31A of 2005).
The following Appropriations bills were approved by a 43 to 7 vote, and enacted by the Governor:
· House Bill 847 was a $462,000 non-preferred appropriation to the Carnegie Museums of Pittsburgh for operations and maintenance expenses and the purchase of apparatus, supplies and equipment (Act 32A of 2005).
· House Bill 848 was a $699,000 non-preferred appropriation to the Franklin Institute Science Museum in Philadelphia for maintenance expenses (Act 33A of 2005).
· House Bill 849 was a $428,000 non-preferred appropriation to the Academy of Natural Sciences in Philadelphia for maintenance expenses (Act 34A of 2005).
· House Bill 850 was a $326,000 non-preferred appropriation to the African-American Museum in Philadelphia for operating expenses (Act 35 A of 2005).
· House Bill 851 was a $42,000 non-preferred appropriation to the Everhart Museum in Scranton for operating expenses (Act 36A of 2005).
· House Bill 852 was a $178,000 non-preferred appropriation to the Mercer Museum in Doylestown for operating expenses (Act 37A of 2005).
·
House Bill
853 was a
$128,000 non-preferred appropriation to the Whitaker Center for Science and the
Arts in Harrisburg for operating expenses (Act 38A of 2005).
* Capital Budget
-- By a 45 to 0 vote, the Senate approved Senate Bill 607, which would
have specified the maximum principal amount of
additional debt that could have been incurred during the 2005-06 fiscal year for
Capital Budget projects. The amounts reflect what Gov. Ed Rendell requested in
his budget proposal. A Democratic amendment was added to the bill that would
have assured the continuity of the Capital Budget funding throughout the budget
process. The House never acted on the bill.
* * * Death Benefits for Emergency Responders -- The Senate unanimously approved Senate Bill 1034, which appropriated $1.632 million to pay increased law enforcement and emergency response personnel death benefits. Earlier in 2005, the Senate approved Act 59 of 2005, which increased the death benefit from $63,000 to $100,000. The bill was enacted as Act 40A of 2005.
The Senate unanimously approved a number of annual 2005-06 appropriations bills. All appropriations were at the level called for in Gov. Ed Rendell’s budget proposal. They included:
· Senate Bill 608 appropriated $24.187 million from the State Employees’ Retirement Fund to provide for expenses of the State Employees’ Retirement Board. (Act 2A of 2005)
· Senate Bill 609 appropriated $39.539 million from the Public School Employees’ Retirement Fund to provide for expenses of the Public School Employees’ Retirement Board. (Act 3A of 2005)
· Senate Bill 610 provided $24.187 million to the Department of State to operate the various professional licensure boards administered by the department’s Bureau of Professional and Occupational Affairs. (Act 4A of 2005)
· Senate Bill 611 transferred funds from the Workmen's Compensation Administration Fund to the Department of Labor and Industry to provide $57.525 million for administrative expenses for fiscal 2005-06. The bill also appropriated $184,000 to the Department of Community and Economic Development to fund workers' compensation activities by the Small Business Advocate. (Act 5A of 2005)
· Senate Bill 612 appropriated $50.369 million from the General Fund and $1.720 million from federal funds to the Pennsylvania Public Utility Commission. (Act 6A of 2005)
· Senate Bill 613 appropriated $4.846 million from a restricted revenue account within the General Fund to the Office of Consumer Advocate in the Office of Attorney General. (Act 7A of 2005)
· Senate Bill 614 appropriated $975,000 from a restricted revenue account within the General Fund to the Office of Small Business Advocate in the Department of Community & Economic Development. (Act 8A of 2005)
Fiscal 2006-07:
The state Senate approved a $26 billion state 2006-2007 fiscal year General Fund Budget that Democrats described as “strong on tax cuts, school funding and support for health care.
The Senate approved House Bill 2499 by a 28 to 21 vote. All Democrats supported the budget. Most Republicans opposed the measure.
The 2006-07 budget also held the line on individual taxes, while slashing various business taxes by $118 million over the next year. The measure also funded the governor’s proposed “Cover-All-Kids” health care initiative. The Democrat-sponsored initiative is aimed at providing health insurance coverage (CHIP) to thousands of Pennsylvania’s children.
In a pair of omnibus tax code bills (SB 300, Act 67 and HB 859, Act 116), the budget included millions in tax cuts for businesses and individuals.
Among some of the business tax cuts included in spending plan were:
· Expansion of the Research and Development Tax Credit from $30 million to $40 million annually. The set aside for small business will increase from $6 million to $8 million.
· Expansion of the Education Improvement Tax Credit by $10 million to $54 million.
· Acceleration of the Capital Stock and Franchise Tax by 0.1 mill, which allows the rate to drop to 3.89 mills; and
· Net Operating Loss provision expanded from $2 million to $3 million.
The 2006-07 budget also spurred a greater investment in schools by adding an unprecedented $720 million in education funding, including a 5.87 percent basic education subsidy hike. No school district statewide received less than 3.5 percent.
Democrats said the General Fund budget was fiscally prudent and restrained discretionary spending at 1.8 percent of the 5.8 percent expenditure increase.
In a rare legislative maneuver, many Democrats – even though they favored the budget plan -- initially voted against the conference committee report after Republican negotiators reneged on an agreement to strengthen the integrity of the state’s gaming law. As a result, the budget was initially voted down 35 to 14. The vote was reconsidered and the budget was adopted.
The governor signed the budget into law as Act 2A of 2006.
* * * Capital Budget -- The Senate unanimously passed House Bill 2317, which provided for the state’s Capital Budget Project Itemization Act for fiscal 2005-2006. The amended bill provided $4.953 billion in project authorizations. The measure was enacted as Act 83 of 2006.
V* * * Supplemental Appropriations -- The Senate unanimously approved House Bill 2380, which provided supplemental appropriations including: $3 million for the Homeowner’s Emergency Mortgage Assistance Program; $3 million to train and hire an additional 180 State Police troopers; $500,000 for the Merchant Marine World War II Veterans Bonus Fund; and $5 million to reimburse counties for full time district attorneys. The bill was enacted as Act 1A of 2006. Insisting that the State Police should re-deploy troopers from non-patrol jobs to active patrol work before additional troopers are hired, Gov. Ed Rendell line item vetoed the section of the bill that would have hired the additional Troopers. Also, stating that the money would not be needed in the 2006-07 fiscal year, the Governor vetoed the section appropriating funds to pay full-time district attorneys.
The Senate unanimously passed the following 2006-07 appropriations bills (percentage increase in italics); and the bills were signed into law as Acts 10A-32A:
The Senate passed the following appropriations bills (increases in parenthesis) by a vote of 43 to 6. The bills were signed into law as Acts 33A-39A:
· House Bill 2527 – $508,000 for the Carnegie Museum and Science Center in Pittsburgh (9.96 percent)
· House Bill 2528 – $769,000 for the Franklin Institute Science Museum in Philadelphia (10.01 percent)
· House Bill 2529 – $471,000 for the Academy of Natural Sciences in Philadelphia (10.05 percent)
· House Bill 2530 -- $359,000 for the African American Museum in Philadelphia (10.12 percent)
· House Bill 2531 -- $46,000 for the Everhart Museum in Scranton (9.52 percent)
· House Bill 2532 – $196,000 for the Mercer Museum in Doylestown (10.11 percent)
· House Bill 2533 -- $141,000 for the Whitaker Center for Science and the Arts in Harrisburg (10.16 percent)
* * * Funding for Attorney General -- The Senate unanimously approved Senate Bill 1159, which appropriated $4.899 million from the restricted account in the General Fund to the Attorney General’s Office of Consumer Advocate for its continued operation 2006-07 fiscal year. The bill was enacted as Act 3A of 2006.
* * * Small Business Advocate – The Senate unanimously approved Senate Bill 1160, which appropriated $975,000 through the Department of Community and Economic Development for the Small Business Advocate for the 2006-07 fiscal year. The bill was signed into law as Act 4A of 2006.
* * * Labor and Industry Appropriations -- The Senate unanimously approved Senate Bill 1161, which provided $60.2 million to the Department of Labor and Industry for the annual operation of the Workmen’s Compensation Administration Fund; and $184,000 to the department’s Small Business Advocate. The bill was enacted as Act 5A of 2006.
* * * PUC Funding -- The Senate unanimously approved Senate Bill 1162, which provided $51.6 million for the annual operation of the state Public Utility Commission. The bill was enacted as Act 6A of 2006.
* * * Licensure Boards – The Senate unanimously approved Senate Bill 1163, which made an appropriation from the Professional Licensure Augmentation Account and from the Restricted Account in the General Fund to the Department of State for the operation of professional licensure boards in the 2006-07 fiscal year. The bill was enacted as Act 7A of 2006.
* * * Teacher Retirement Fund – The Senate unanimously approved Senate Bill 1164, which appropriated $39.5 million for the general government operations of the school employee’s retirement fund. The bill was enacted as Act 8A of 2006.
* * * State Employee Retirement Fund – The Senate unanimously approved Senate Bill 1165, which appropriated $24.9 million for the general government operations of the State Employee’s Retirement Fund. The bill was signed into law as Act 9A of 2006.
* * * Capital Budget Act – The Senate unanimously approved Senate Bill 1166, itemizing more than $1 billion for public improvement, transportation assistance and redevelopment assistance capital projects under the state’s capital budget. Individual projects would have to be approved by various state agencies. The budget represented an increase of more than $300 million over fiscal 2005-06.The bill was signed into law as Act 152 of 2006.
* * * Conservation Fund – The Senate unanimously approved Senate Bill 1224, which amended the Conservation District Law to create a fund for state conservation appropriations. The bill was enacted as Act 110 of 2006.
* Inter-agency Transfers -- The Senate unanimously approved Senate Bill 1303, which would have required the Pennsylvania Gaming Control Board to submit an annual itemized budget, including administrative expenses, to the General Assembly.
Following legislative approval, the Board’s expenses would have been paid through gaming proceeds (section 1401 of the Act) that relates to the slot machine licensee deposits.
The measure was prompted by a dispute over the Governor’s inter-agency transfer of funds between the Revenue Department and Gaming Board in 2006. Following delays in getting slots licensees up and running, the gaming board was running short on funds, prompting the Governor to shift funds between the two agencies.
The bill died in the House Appropriations Committee.
* More on Inter-agency Fund Transfers -- In a 28 to 21 party line vote, the Senate approved Senate Bill 1305, which would require the Governor’s office to take additional steps before an interagency transfer of appropriated funds could take place.
Historically, the governor has had the authority to transfer budgeted monies between agencies.
Under the bill, the state budget secretary would have been required to notify both the House and Senate Appropriations Committees in writing about such transfers 10 days in advance. In addition, the Attorney General would have been required to approve the transfer in writing before it can be executed.
Democrats argued that the bill was aimed at doing little more than adding needless bureaucratic hurdles to a funding procedure that governors have used for many years.
The bill was likely prompted by the Rendell Administration transferring excess money from the Revenue Department to help fill funding shortfalls in the Gaming Board’s Budget in 2006r. Administration officials claimed the governor would have vetoed the bill if it reached his desk.
The measure was never acted
on in the House.
* Debt Cap -- By a 32-18 vote, the Senate approved Senate Bill 1368, which would have amended the Capital Facilities Debt Enabling Act to provide for debt limitation on redevelopment assistance capital projects. The bill would have raised the cap on outstanding obligations for redevelopment assistance capital projects by $250 million from $2.65 billion to $2.9 billion. The bill died in the House.
*** MCARE Abatement Program The Senate voted unanimously to extend the Medical Care Availability and Reduction of Error Act (MCARE) Abatement Program, whose intent is to keep doctors practicing in Pennsylvania by helping with malpractice insurance premiums.
The measure, House Bill 2041, also required that Pennsylvania Insurance Department report on the effectiveness of the program and sets up a commission to address unfunded liabilities in the MCARE system.
The Governor signed the bill into law as Act 88 of 2005.
*** MCARE Abatement Program The Senate voted unanimously on legislation that extends the Medical Care Availability and Reduction of Error Act (MCARE) Abatement Program for another year.
The state-run MCARE fund provides relief for doctors struggling to pay rising medical malpractice insurance costs. Senate Bill 972 extends the MCARE Abatement Program through 2007. Also, emergency physicians, not employed full time by a trauma center or working under an exclusive contract with a trauma center, are also eligible for abatement.
The Governor signed the bill into law as Act 128 of 2006.
** HIPAA Alternative Mechanism Program The Senate unanimously approved legislation that would have amended the Insurance Company Law to improve the HIPAA Alternative Mechanism program, which ensures that individuals can purchase an individual insurance policy.
Senate Bill 1335 would have ensured that the premium for HIPAA Alternative Mechanism insurance is the same as the premium for identical coverage in the individual health insurance market. Insurers would have been required to notify the department if they are utilizing this option, and the rates would have been subject to departmental review.
The bill died in the Senate after the House added amendments.
*** Health Savings Account Act The Senate unanimously passed House Bill 107, the Health Savings Account Act. This legislation authorizes the establishment and maintenance of health savings accounts (HSAs) that are offered as an alternative to high-deductible health insurance plans.
The bill exempts from state income taxes any amount paid or distributed out of a HSA to cover qualified medical expenses or reimburse a beneficiary. Contributions to HSAs are not exempt from state income taxes, and high-deductible insurance plans are permitted to continue charging a deductible for certain benefits.
The Governor signed the bill into law as Act 48 of 2005.
*** Financial Statements Expiration The Senate unanimously passed House Bill 2542, clearing up ambiguities that led some lawyers and financial institutions to believe that all financial statements filed under the UCC’s old Article 9 were to expire on June 30, 2006.
The legislation allows Pennsylvania corporations to file a “continuation statement” allowing financing statements filed with the Department of State prior to July 1, 2001 to remain as legally effective documents.
The Governor signed the bill into law as Act 64 of 2006.
*** Credit Reporting Agency Law The Senate unanimously approved Senate Bill 180, which creates the Credit Reporting Agency Law and provides for consumer report freezes.
Through this legislation, Pennsylvanians will have the right to place a security freeze on their consumer report. The freeze will prevent consumer reporting agencies from releasing an individual’s consumer report for credit approval.
The Governor signed the bill into law as Act 163 of 2006.
*** Interstate Insurance Product Regulation The Senate unanimously passed Senate Bill 260, which establishes the Interstate Insurance Product Regulation Compact. The compact provides uniform standards for individual and group annuities, life insurance, disability income insurance and long-term care insurance.
The Governor signed the bill into law as Act 78 of 2005.
By signing this compact into law, Pennsylvania joins other states to establish a joint public agency known as the “Interstate Insurance Product Regulation Commission,” a corporate body responsible for enacting and enforcing interstate insurance regulations, reviewing products, rate filings and advertisements, and prosecuting legal proceedings.
The compact would become effective when 26 states — or states representing more than 40 percent of the premium volume for covered lines of insurance — enact this legislation.
*** Tax Code Changes The Senate unanimously approved Senate Bill 300, which made several changes to the Tax Reform Code.
The bill exempts investment coins and bullion from the state’s sales tax; exempts contributions to health savings accounts from the state income tax; and allows an income tax deduction – and earnings tax exemption -- for contributions to qualified college tuition account programs (IRC 529).
The measure also accelerates the phase-out of the Capital Stock and Franchise Tax by reducing the rate an additional 0.10 mill for tax year 2006. The tax is to be reduced by an additional 1 mill for each year after until the tax is completely eliminated in 2011. The measure also increases the fixed formula deduction used to calculate the capital stock value of a company from $125,000 to $150,000 (beginning in 2007); and exempts single member Restricted Professional Companies from the tax.
The bill also reduces the valuation of farmland that has been designated as an agricultural conservation easement to 50 percent of the value determined under the inheritance tax (applies to deaths on or after passage of the act).
The Governor signed the bill into law as Act 67 of 2006.
* Life Insurance Benefits for PA National Guard The Senate unanimously passed Democrat-sponsored legislation to improve life insurance benefits for Pennsylvania National Guard soldiers on active duty.
Senate Bill 398 would have boosted life insurance benefits for soldiers deployed or preparing for deployment to $400,000. The federal government would have paid the premium for the first $150,000, and the state would have paid for the next $250,000.
The bill died in the House.
*** Strategic Development The Senate approved Senate Bill 854, which establishes a program of strategic development areas.
Strategic development areas are intended as state and local tax-free areas to encourage economic development with a defined geographic area.
The Governor signed the bill into law as Act 151 of 2006.
*** Health Insurance Benefits for Military Personnel The Senate voted unanimously in favor of Senate Bill 869, which extends health insurance benefits for certain military personnel who were covered under their parent’s insurance and were full-time students at the time of deployment.
To qualify, the student must be a member of the Pennsylvania National Guard or the Reserve who are called to active duty or active state duty, other than for training, for a period of 30 or more consecutive days. Coverage will be extended for a period equal to how long the student was on active duty or until they are no longer a full-time student.
The Governor signed the bill into law as Act 83 of 2005.
*** Commercial Fire Insurance Policy The Senate unanimously approved Senate Bill 1007, which allows insurance companies to exclude fire damage caused by terrorism from their commercial fire insurance policies.
Commercial fire insurance policies have the following exemptions: enemy attack by armed forces; invasion; insurrection; rebellion; revolution; civil war; usurped power; order of any civil authority; neglect of insured to use all reasonable means to save and preserve property; or loss by theft.
The Governor signed the bill into law as Act 104 of 2006.
*** Social Security Identification Protection The Senate unanimously approved House Bill 2134, which limits the collection of Social Security numbers by state agencies and local governments and prohibits placing these numbers on health insurance cards.
The bill establishes a general rule that in applying for a professional license or certification, occupational license or certification, or recreational license, applicants may provide their driver’s license number or non-driver ID card number as an alternative to providing their Social Security number.
The Governor signed the bill into law as Act 160 of 2006.
*** Social Security Identification Protection The Senate voted unanimously on Senate Bill 601.
This bill provides that no individual or entity (including state agencies) is allowed to publicly post a person’s Social Security number, print it on an identification card, require its transmission over an unencrypted Internet connection, require its use for accessing an Internet site, or send it through the mail (except as required by state or federal law).
The Governor signed the bill into law as Act 60 of 2006.
** Protection from Spyware The Senate unanimously approved Senate Bill 711, which would have provided for the protection of consumers from having spyware deceptively installed on their computers and for criminal and civil enforcement; and provided for civil immunity under certain circumstances.
The bill died in the Senate after coming back over amended from the House on concurrence.
*** Personal Identification Protection The Senate unanimously passed important consumer protection legislation in response to a rash of security system breaches at data collection agencies and companies.
Senate Bill 712 requires companies to notify consumers when their personal information (including Social Security numbers, driver’s license numbers, and banking information) has been revealed due to a security system breach.
The Governor signed the bill into law as Act 94 of 2005.
*** Cell Phone Number Options The Senate unanimously passed Senate Bill 713, which requires consumers to opt-in for listing in any cellular phone provider’s directory. Also, customers are not charged for having an unlisted cell phone number.
The Governor signed the bill into law as Act 32 of 2006.
*** U.S. Postal Service Electronic Postmark The Senate unanimously approved Senate Bill 770, which defines the United States Postal Service Electronic Postmark (USPS EPM).
The bill directs governmental agencies to set up policies and procedures for using the USPS EPM or similar services. Executive agencies must comply with standards published by the Office of Administration concerning the use of electronic postmarks.
The Governor signed the bill into law as Act 173 of 2006.
* Voice over Internet Protocol Fee The Senate unanimously approved Senate Bill 936, which would have required Voice over Internet Protocol (VoIP) telephone service providers to assess a $1 fee for each customer service line. This fee would have been distributed by PEMA to counties to assist with implementing their 911 plans.
The fee would have been stated separately on a customer’s bill and collected separately from any other fee levied by the provider for 911 services. VoIP providers would have been permitted to retain up to 2 percent of the total fees collected as reimbursement for administrative costs. Businesses with over 25 lines through a VoIP telephone provider would have paid a prorated fee for each line.
The bill died in the House.
* Phishing The Senate unanimously approved Senate Bill 1036, which would have aided in the battle against identity theft by making it illegal to go “phishing” in Pennsylvania.
Phishing is a crime in which people use e-mail to falsely claim to be an established enterprise in an effort to lure people to a Web site to collect personal data, such as Social Security, bank account or credit card numbers, or passwords. Often the Web site that people are lured to resembles established Internet enterprises, such as eBay.
Under the bill, it would have been a felony offense to phish personal information and would have carried a fine of $100,000 for each violation, along with the ability to collect damages of up to three times the actual amount (if the court so rules), as well as attorney fees.
The bill died in the House.
*** Unfair Trade Practices and Consumer Protection Amendment The Senate voted unanimously on Senate Bill 1218, which amends the Unfair Trade Practices and Consumer Protection Law to exempt Internet service providers from being held liable for unknowingly transmitting false advertising. Similar protections already exist for newspapers and other publications.
The Governor signed the bill into law as Act 185 of 2006.
*** Hotel Tax Increase Authorization – The quest to lure a professional baseball team to the Lehigh Valley got a boost from the state Senate, which voted 44-6 on legislation to help finance a new minor league stadium. The stadium will host a Triple-A affiliate of the Philadelphia Phillies beginning in 2008.
House Bill 157 permitted Lehigh and Northampton counties to raise their hotel room tax by 0.5 percent to 4 percent. The counties are using the additional funds for tourism-promotion activities, including building and maintaining a new ballpark in east Allentown. The bill also clarified the appropriate uses of the hotel tax and hotel room tax in third- through eighth-class counties. The bill was signed into law as Act 12 of 2005.
*** Downtown Location Law Updated – The Senate unanimously approved legislation that is aimed at revitalizing Pennsylvania’s historic downtowns by encouraging state agencies to locate in downtown facilities.
House Bill 218 updated the state’s Downtown Location Law to tighten its definition of “downtown area,” so that business parks and shopping malls located outside the city’s central business district do not qualify for the designation.
The bill was signed into law as Act 39 of 2006.
*** Lancaster Convention Center Project – Legislation to improve a state program that helps Pennsylvania’s cities finance large-scale projects won Senate approval by a final vote of 46-2.
House Bill 983 made several changes to the Infrastructure and Facilities Improvement Program (IFIP), a program first created with Act 23 of 2004. This program provides multi-year grants for debt service on convention centers, hospitals, hotels, manufacturers, industrial enterprises, retail enterprises, and research and development enterprises. The amount of grant funding is calculated on the basis of the anticipated amount of state sales tax, hotel occupancy tax, and employer withholding of personal income tax to be generated by a project.
This bill makes the program more attractive by allowing applicants to defer the commencement of such grants until construction has been completed and the facility has begun operating. The bill also permits local governments to abate local taxes owed without interfering with an applicant’s eligibility for an IFIP grant. This provision was key to clarifying legal questions arising from a controversial convention center project in Lancaster.
In addition, this bill converted the state’s existing Film Production Tax Credit Program into a grant program. This program provides $10 million annually in state funds to films that are produced in Pennsylvania.
The bill was signed into law as Act 42 of 2006.
*** Community Services Block Grants Extended – The Senate voted unanimously to extend the Community Services Block Grant program until December 31, 2011. This federally funded program helps community action agencies and other non-profits reduce poverty and assist low-income individuals. House Bill 1361 was signed into law as Act 70 of 2005.
*** Budget Agreement Provisions – The Senate voted 47-2 in favor of legislation that will amend the Fiscal Code and temporarily boost the amount of loans authorized under the Local Government Capital Project Loan Fund.
The conference committee amended the conference report on House Bill 1992 to include language implementing the budget agreement. These provisions, which are typically included in the actual budget legislation, were incorporated into a separate bill this year to avoid a repeat of last year’s showdown with the governor over his line-item veto of Medicaid waver language.
(Twenty-one states already receive this type of waiver, which allows low-income women who would not normally qualify for Medicaid to receive family planning services through any Medicaid provider. The Medicaid family planning waiver would enable Pennsylvania to receive $9 from the federal government for every $1 of state funds spent and would result in millions of dollars saved each year.)
Pro-life legislators were privately advocating for language that would have made it more difficult for family planning service providers to obtain their share of state funding through the women’s medical services appropriation. The traditional deal on family planning funding dates back to the Casey administration and requires a 50-50 split between clinics similar to Planned Parenthood and crisis pregnancy centers that encourage alternatives to abortion. The deal also requires funding recipients to maintain physical and financial separation between projects receiving state funds and any portion of their organization that provides abortion counseling or abortions. Under this agreement, no state funds go toward abortions or abortion counseling.
Family planning service providers had concerns that pro-life legislators would attempt to go beyond the parameters of this deal and take away all funding for family planning projects. These organizations estimate that each year 85,000 low-income women receive health services (including examinations, disease testing, non-invasive contraception, even diabetes screenings) through their state appropriation.
The final version of House Bill 1992 included language codifying the existing deal and extending the separation provision to include family planning service providers funded through the Medicaid waiver. Family planning service providers agreed to the language after a sunset provision was included, voiding the deal if pro-life legislators attempted to remove the women’s medical services appropriation or prevent the state from obtaining the Medicaid waiver in the future.
House Bill 1992 also included the following provisions as part of the budget agreement: