Your Chamber advocacy team is working to share legislative updates and continue to advocate for your business in Washington, D.C., Harrisburg, and Philadelphia. We’ve created a round-up of recent activity, including Key Takeaways for Your Business and a Detailed Legislative Update. This represents our best knowledge of the situation as of 9:00 a.m. on Friday, July 19, 2024.

Chamber members are invited to join weekly legislative update calls hosted by our advocacy team to hear the latest legislative matters concerning our community. These calls will be on pause through the summer and will resume on Friday, September 13, 2024.

KEY TAKEAWAYS FOR YOUR BUSINESS

Local

  • The City’s Tax Reform Commission (TRC) continues to meet over the summer, with its next meeting on Friday, July 19, 2024. The TRC is conducting a comprehensive analysis of all taxes imposed in Philadelphia, including by the Commonwealth of Pennsylvania, and will make recommendations concerning tax reforms this fall. 
  • After a Common Pleas Court judge ruled in favor of the city (on District Council 47’s emergency petition to halt the mayor’s return to work order) at a hearing last Friday, all city workers returned to a full-time in-office schedule on Monday, July 15, 2024. 

The Chamber’s 2024 Annual Meeting will be held on Friday, October 25, 2024. Join our community of regional partners, members, and investors to network, connect, and reflect on our city and region’s progress toward our shared mission of accelerating Greater Philadelphia’s success as a top global destination for business and a leader in inclusive growth. Tables are available for purchase. Contact Maria Flores, Production Director, the Chamber, at mflores@chamberphl.com for more information.

State

  • On July 11, 2024, state leaders agreed on a $47.6 billion budget. Items of particular importance to the business community within the budget included business attraction and expansion, basic education, and a more competitive business tax and permitting environment. 
  • The Chamber is gravely concerned that SEPTA is expected to receive less than $60 million in one-time state funding, falling significantly short of the $240 million needed to avoid the fiscal cliff our region’s mass transit system faces. Without a sustainable and adequate mass transit funding solution, SEPTA will undoubtedly experience a collapse as riders abandon transit due to the spiraling effects of service cuts, fare increases, and job losses.  

DETAILED LEGISLATIVE UPDATE

Local: Updates from Philadelphia’s City Hall

City Council Recess

City Council remains in recess until after Labor Day and is scheduled to return on Thursday, September 5, 2024. 

Tax Reform Commission  

The City’s Tax Reform Commission (TRC) continues to meet over the summer, with its next meeting on Friday, July 19, 2024. The TRC is conducting a comprehensive analysis of all taxes imposed in Philadelphia, including by the Commonwealth of Pennsylvania, and will make recommendations concerning tax reforms this fall. 

The TRC includes four members each appointed by Mayor Cherelle Parker and Council President Kenyatta Johnson, one member appointed by City Controller Christy Brady, and the remaining members appointed by various local Chambers of Commerce. The 15 members are:  

  • Paul Levy, Richard Vague (Co-Chair), Jovan Goldstein, and Ryan Boyer (Council)
  • Matt Stitt (Co-Chair), Folasade (Sade) Olanipekun-Lewis, Jerry Sweeney, and Greg Segall (Mayor)
  • Allan Domb (City Controller)
  • Jennifer Karpchuk (The Chamber of Commerce for Greater Philadelphia)
  • Derek Green (African American Chamber of Commerce of PA, NJ & DE)
  • Victor Garrido (Greater Philadelphia Hispanic Chamber of Commerce)
  • Daniel McElhatton (Greater Northeast Philadelphia Chamber of Commerce)
  • David Oh (Asian American Chamber of Commerce of Greater Philadelphia)
  • Zach Wilcha (Independence Business Alliance) 

Based on the TRC’s enabling legislation, the city has also recognized a Tax Reform Advisory Committee which consists of appointees from various organizations and associations from throughout the city.  The purpose of this advisory committee is to provide a community perspective on tax reform. Organizations participating on the advisory committee are: 

  • Action Alliance of Senior Citizens of Greater Philadelphia 
  • Asian-Americans United 
  • Community Legal Services 
  • Federal Reserve Bank of Philadelphia 
  • Fox School of Business and Management of Temple University 
  • Greater Philadelphia Association of Realtors 
  • Keystone Research Center 
  • NAACP Philadelphia Chapter 
  • Pennsylvania Economy League Eastern Division 
  • Pennsylvania Institute of Certified Public Accountants 
  • Philadelphia Bar Association 
  • Philadelphia Building and Construction Trades Council 
  • Philadelphia Council AFL-CIO 
  • Philadelphia National Organization for Women 
  • Philadelphia Unemployment Project 
  • Tenant Action Group 
  • Urban League of Philadelphia 
  • University City District (formerly West Philadelphia Partnership) 
  • Wharton School of the University of Pennsylvania 
  • Children First (formerly Parents’ Union) 

 City Workers Return to Office 

After a Common Pleas Court judge ruled in favor of the city (on District Council 47’s emergency petition to halt the mayor’s return to work order) at a hearing last Friday, all city workers returned to a full-time in-office schedule on Monday, July 15, 2024.  

In May, Mayor Cherelle Parker mandated all municipal employees return to in-office work to create a more visible and accessible government. The decision ended the city’s virtual work policy, put in place in 2021, and essentially returns employee scheduling to what it was before the COVID-19 pandemic.  About 80% of the city’s 26,000 employees have been working on site since last year, while the rest have worked on site 31 to 75 hours per pay period. 

Upcoming Chamber Event

2024 Annual Meeting
Friday, October 25, 2024 | 11:00 AM – 1:30 PM | Pennsylvania Convention Center
Tables and sponsorship packages available.

State: Updates from Harrisburg

On Thursday, July 11, 2024, the governor and House and Senate leaders agreed on a $47.6 billion budget, ending a nearly two-week budget impasse.  This represents a $2.72 billion or 6.2% increase from the prior fiscal year.  The budget deal was advanced through several pieces of legislation including a General Appropriations Bill (SB 1001), Fiscal Code (HB 2310), School Code (SB 700), Tax Code (SB 654), and higher education bills (HB 897, SB1150 and SB1154) among others. A full outline of the General Appropriations spending bill – including previous budget levels and the enacted FY24-25 budget levels – can be found here. 

Despite the inclusion of several business-friendly provisions, the Chamber is gravely concerned to learn that SEPTA will receive less than $60 million in one-time state funding, falling significantly short of the $240 million needed to avoid the fiscal cliff our region’s mass transit system faces. Without a sustainable and adequate mass transit funding solution, SEPTA will undoubtedly experience a collapse as riders abandon transit due to the spiraling effects of service cuts, fare increases, and job losses, significantly and negatively impacting our regional economy and quality of life.  

We strongly urge our elected leaders to honor the commitment to reach a permanent funding solution this fall and are encouraged to hear the governor’s assertion that this budget marks ‘just the start’ of state investments in Pennsylvania’s public transit systems. The Chamber’s full statement on Pennsylvania’s FY24-25 budget and transit funding can be found here. 

However, the Chamber was pleased to see several provisions important to the business community included within the budget, such as business attraction and expansion, basic education funding, quality of life improvements, and a more competitive business and tax permitting environment. 

Education Funding:

  • The budget provides an additional $225 million through the basic education fair funding formula (2.9% increase) as well as a $493 million adequacy supplement and $32 million tax equity supplement. The governor proposed $872 million in adequacy payments. Under the proposal, the Philadelphia School District would receive $136 million in adequacy payments, down from the originally proposed $202 million by Democrats.  
  • The extremely contentious school choice vouchers were ultimately not part of the budget deal. Instead, the agreement provides an additional $75 million allocation and expansion to the Educational Improvement Tax Credit and the Opportunity Scholarship Tax Credit which incentivizes contributions to private schools that extend scholarships to economically disadvantaged students. 

Fiscal Code 

  • Transit: We are disappointed that transit agencies across the state did not receive $283 funding through an increased allocation under the sales tax as originally proposed by the governor. Instead, $80 million one-time dollars were credited to the Public Transportation Trust Fund.  Without the anticipated $161 million in new and sustainable funding that SEPTA had anticipated, it may be forced to consider service cuts and fare increases across the regional transit system. 
  • Economic Development Funds: We are happy that the PA SITES Fund will receive $500 million to spend over three years through a bond issuance. $400 million will be administered by the Pennsylvania Economic Development Financing Authority; $100 million will be administered by the Commonwealth Financing Authority.  The proposed Pennsylvania Innovation Fund did not receive $20 million in funding as proposed by the governor; we will continue to call for the establishment of this fund in the next budget cycle. 
  • Permitting Reform: Establishes the Streamlining Permits for Economic Expansion and Development Program (SPEED) within the Department of Environmental Protection which would allow third-party review of certain permits. 

  Tax Code 

  • Net Operating Loss (NOL) Cap Increase: Increases the net operating loss carry forward limit from 40% to 80% on prospective or new losses.  Existing or legacy losses will be maintained at the current 40% cap. This is a welcome step in the right direction; we need to continue the discussion with lawmakers to address legacy NOLs of established Pennsylvania businesses in the months ahead. 
  • Pass-Through Entity Tax: Provides an elective pass-through entity tax filing option which would facilitate the federal deductibility of state income taxes. 
  • Employer 529 Contribution Credit: Creates a tax credit for employer contributions to 529 tuition savings accounts. Effective for Tax Years after December 31, 2024. 
  • Childcare Contribution Tax Credit: Provides a tax credit for employers who contribute to employees’ childcare costs. Effective for Tax Years after December 31, 2024. 
  • Student Loan Interest Deduction: Permits a taxpayer who is a Pennsylvania resident to deduct student loan interest from the individual’s taxable income under the personal income tax. Effective for Tax Years after December 31, 2024. 

  Higher Education Reforms 

  • Higher Education Board: Establishes the State Board of Higher Education (board) for the purpose of providing direction, coordination, and support to ensure that institutions of higher education fully meet the workforce and economic development needs of this Commonwealth and ensure that all residents have access to affordable, world-class postsecondary education. 
  • Performance-Based Funding: Establishes the Performance Based Funding Council within the new State Board of Higher Education to make recommendations for a process to distribute funds to Penn State University, the University of Pittsburgh, and Temple University. 
  • Grow Pennsylvania Scholarship Program: Provides $5,000 scholarship grants to Pennsylvania students who stay to work in Pennsylvania in an in-demand occupation after graduation. 
  • Grow Pennsylvania Merit Scholarship Program: Provides out-of-state students attending state-owned universities in-state tuition in exchange for a commitment to work in Pennsylvania in an in-demand occupation after graduation. 

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We invite you to reach out to our advocacy team directly with your questions:

Chamber members are invited to join weekly legislative update calls hosted by our advocacy team to hear the latest legislative matters concerning our community. These calls will be on pause through the summer and will resume on Friday, September 13, 2024.