Representing the interests of our several thousand members across Pennsylvania, the Manufacturer & Business Association's Government Affairs is your voice on local, state and federal issues.

EVENT – Senator Dan Laughlin, Legislative Luncheon, 1/29/2026 Register Today!

STATE

• MBA’s Legislative Priorities - YTD
• Elections 2026
• The 2026 - 27 State Budget & Independent Fiscal Office (IFO) Outlook
• GROW PA - A win all the way around.
• State and Local Expenditures - A 50 State Comparison

FEDERAL

• Elections 2026
• U.S. House

AI – A KEY FIGHT in 2026 – STATE and FEDERAL

• Who should decide AI regulations?

MBA’s Legislative Priorities - YTD

Energy is at the top of the agenda for MBA along with AI, PJM, datacenters, additional permitting reforms, transit, and a push for more Career and Tech Center funding. MBA filed Comments with the PUC on the Tentative Order for the Model Tariff for large load users. Grid reliability and energy costs have all been moved to HIGH IMPORTANCE with the AI revolution in PA and the development of the data centers.

GROW PA

MBA worked diligently to pass the GROW PA package of bills because it directly addressed PA’s poor demographics.

“Over 4,000 Pennsylvania college students received state-funded GROW PA scholarships…

Under the GROW PA Scholarship Program, the students are eligible to receive scholarships in exchange for a commitment to work at least one year in the state after graduation for every year they receive scholarship funding. If graduates don’t satisfy the residency requirement, their scholarships will be converted to loans…

The scholarship program was created through Act 89, passed at the time of the 2024-25 budget deal in July 2024.Sen. Scott Martin, R-Lancaster, was the prime sponsor…

Most popular programs for GROW PA scholarships: Nursing – 507 recipients / Early childhood education — 270 recipients/ Business administration/management — 178 recipients/ Biology — 140 recipients/ Accounting — 127 recipients/ Elementary education — 119 recipients/ Special education — 102...”

…Broadly adapted from “Over 4,000 Pennsylvania students awarded Grow PA scholarships for in-demand fields,” John Finnerty, CapitolWire/State Affairs Pennsylvania.12/28/2025.

Elections 2026

Statewide voters get their say electing a governor for a four-year term and members of the General Assembly on Tuesday, November 3, 2026. High-stakes 2026 elections will determine control of Pa. legislature, which party sets policy.

Democratic Gov. Josh Shapiro is seeking a second term. Treasurer Stacy Garrity is the endorsed Republican candidate for governor.

All 203 PA House seats are on the ballot. Democrats control the House with a one-seat majority. Four special elections will take place to fill the remaining months in terms of members resigning their seats to assume local offices. Elections for seats of Representatives Dan Miller and Josh Siegel will be held on 2/24/26 and for Representatives Torren Ecker and Lou Schmitt’s on 3/17/26.

In the PA Senate, the 25 even-numbered seats in the 50-member Senate are on the ballot.

Republicans control the Senate 27-23.

Notable retirements

Pa Rep. Anita Kulik is retiring and will not run in November 2026

Rep. Bryan Cutler is retiring and will not run in November 2026. Cutler has been a steadfast friend of the MBA and has attended and presided over the Business Issues Forum part of the Western PA Legislative Reception.

The 2026-27 State Budget & Independent Fiscal Office (IFO) Outlook

Governor Shapiro will deliver his budget for Fiscal Year 2026-27 on Tuesday, Feb. 3.

The $50.09 billion state budget for 2025-26 increased state spending by 5.1% or $2.4 billion increase over last year. It carried forward a $5 billion structural deficit, meaning it spends $5 billion more than net revenue for 2025–26.

The state Independent Fiscal Office IFO said tough decisions about the state budget need to be made. The IFO’s annual fiscal outlook finds a large structural deficit, increasing from $5 billion to $7.7 billion by 2030-2031.

Annual deficits are higher than last year’s outlook by roughly $1 billion. Factors that contributed to the deficit expansion:

• Higher-than-anticipated education and health care spending, including future federal cost shifts related to the Supplemental Nutrition Assistance Program (SNAP)
• Approximate $1 billion increase in new tax credits,
• A rapidly expanding elderly population,
• Continued phased in of the corporate net income tax rate reduction.
• The roughly $500 million backfill of prior funding from the Motor License Fund for State Police and a new transfer of $560 million for the current year from sales tax revenues to the Public Transportation Trust Fund (PTTF)

The fiscal imbalance will present a huge challenge. Most General Fund spending is mandatory (56%) or used for pre-K through 12 education (36%) and is unlikely to be cut.

By the end of FY 2025-2026, the General Fund surplus will be depleted, but the $7.8 billion Rainy Day Fund should remain intact. However, the state is on pace to deplete the General Fund surplus in the coming year and on pace to wipe out the $7.5 billion Rainy Day Fund by 2027-28.

State and Local Expenditures - A 50 State Comparison

Independent Fiscal Office

November 2025

“…This report examines Pennsylvania expenditures by category (e.g., education) over time, compares.

Pennsylvania expenditures to other states and the U.S. average and ranks the distribution of major spending categories by state…” 

Here are several examples of content:

• Fiscal Year (FY) 2022-23 Total Spending per Capita – PA ranks 19^th at $13,579
• FY 2022-23 K-12 Education Spending per Student – PA ranks 9^th at $22,550
• FY 2022-23 Higher Education Spending per Student – PA ranks 26^th at $15,581.
• FY 2022-23 Public Welfare Spending per Capita – PA Ranks 12^th at $4,100.
• FY 2022-23 Health and Hospitals Spending per Capita – PA ranks 22^nd at $1,121.
• FY 2022-23 Highway Spending per Capita - PA ranks 15^th at $940.
• FY 2022-23 Highway Spending per 1,000 miles – PA ranks 9^th at $100,398

READ MORE

Elections 2026 

Pennsylvania is likely to play a crucial role in determining the balance of power in Congress in the 2026 midterm elections, with four U.S. House seats expected to be competitive — more than any other state. All 19 members of the PA Congressional delegation will be on the ballot this year. The four most closely watched races are the seats held by U.S. Representatives Brian Fitzpatrick, Ryan Mackenzie, Rob Bresnahan, and Scott Perry.

**After successfully propelling Zohran Mamdani to the mayor’s office in New York City, the campaign firm Fight Agency is moving on to its next targets – defeating Pennsylvania Reps. Ryan Mackenzie and Rob Bresnahan. Politics PA Steve Ulrich, November 24, 2025

U.S. House

The U.S. House returned from a holiday break to face sagas that have confounded the chamber for months.

Here are several things the House faces in January:

• Scrutiny of DOJ’s Epstein compliance.
• Vote on extending ObamaCare subsidies - Enhanced ObamaCare subsidies officially expired at the end of 2025, but the battle in Congress to revive the credits and prevent increased premiums for 22 million people on Affordable Care Act marketplace plans will continue in the new year.
• Government funding deadline - Lawmakers will race to complete spending negotiations before the bulk of the federal government’s funding runs out on Jan. 30, the date set by a continuing resolution that ended the longest-ever government shutdown in November.
• Discussions over a stock trading ban will heat up.

AI – A KEY FIGHT in 2026 – STATE and FEDERAL

Who should decide AI regulations?

The battle over whether the federal government should preempt state AI laws became a central issue in 2025, as states forged ahead with efforts to regulate the technology while President Trump pushed for a hands-off approach. He wants AI to be regulated minimally while states wish to go further.

GOP lawmakers attempted to include a 10-year moratorium on state AI laws in Trump’s One Big Beautiful Bill, but the provision was stripped out by the Senate after facing pushback from other Republicans. Another attempt was made in the National Defense Authorization Act in late November but fell short,

Trump signed an executive order in December that calls for the creation of a task force to challenge state AI measures in court. A policy would limit broadband funding to states with AI laws deemed overly burdensome.

Pennsylvania Attorney General Dave Sunday joined a group of 35 attorneys general urging federal lawmakers not to strip states of their ability to regulate artificial intelligence.

Concern continues to grow over the safety of AI, particularly the use of chatbots by teens. A recently proposed bill in the PA State Senate, SB 1090, Safeguarding Adolescents from Exploitative Chatbots, would implement age restrictions and other safeguards for the technology.

According to a Google search, there are more than 20 bills in the PA General Assembly pertaining to AI regulation.

When: Thursday, January 29, 2026

TIME: Registration begins at 11:30 a.m. Program, Noon - 1 p.m.

Where: MBA Conference Center, 2171 W 38th Street at Pittsburgh Avenue, Erie

Cost: $40 Members | $60 Nonmembers (lunch included)

Start the new year with an insider update straight from Harrisburg!

Join The MBA and Senator Dan Laughlin for key insights on the state budget, what's happening behind the scenes and what businesses should expect as we head into 2026.

This is your chance to be in the room with decision-makers and a network shaping the future of our business community. Seats are limited and this is an update you can't afford to miss!

“Our experience, engineering and planning make the difference. We are family owned and made with family pride for over three generations! CID offers ultimate availability for immediate solutions to your space management needs in the field, at the site and around the globe. For expandable, flexible, dependable, and available modular lifting buildings and custom interiors, ask CID, the authority on space management solutions.”

How many times have you heard an employer say, “We can’t find workers,” or “We can’t find workers who want to work”? There is no silver bullet to find workers, especially those in the trades. I recently bumped into Jackie Bott at an event and in our brief conversation she mentioned a novel workforce solution. I was quick to follow up.

Before the Covid-19 pandemic, CID had around 55-60 employees. CID has two lines of business and usually when one is down, the other is busy, but post-Covid-19 both lines were busy, so they needed workers.

They were looking for welders, carpenters, electricians, and general labor. Jackie, who is not a human resources person, had to wear a new hat. She searched for months, scouring INDEED, staffing agencies, and explored co-ops with trade schools.

Jackie was constantly reading resumes. During interviews she asked simple questions. “Do you know you have to come every day and be on time?” She was “ghosted” many times.

Some days luck finds you. A stranger, Jim, from Hope Center Ministries, Butler County, stopped unannounced. He said they were starting a new program for addicts, and he had to place them in work centers.

CID decided to give the program a try. At that time, business was slow, but they wrote up the contract with Hope Center Ministries. Although CID didn’t bring in any workers right away, Scott knew of other companies having difficulty hiring and passed the information along.

In late 2023 CID brought in three workers from the program. CID eventually brought in several more workers which has solved their labor problem.

The program works like this: It is a full year residential program for men who suffer from addictions of ANY type; drugs, gambling, sex, alcohol etc. It is faith-based and affiliated with a church. Once accepted into the program, men have room and board at the Center. They spend the first 30 days at the center to acclimate them to the program. The next 40-week period they are placed into a workplace. Some have skill sets; others are trained on the job.

During the 40-week period, the men work but do not receive a paycheck. Instead, the company pays the Hope Center, not the workers. After 40 weeks they become CID’s employees, and they are paid directly by the company. The Center provides transportation to and from the workplace. They simultaneously train the men to manage their finances so they can eventually buy a car or rent an apartment, since they do not stay at the Hope Center indefinitely.

The Hope Center doesn’t consider them a successful graduate until they complete their first year in the program. For the year following graduation, the Center stays in contact with the men. The men must remain employed and pass drug tests. If they revert to their old addictions, they have to leave the program.

Part of the mission is rehabilitation and part of it is helping the men to mend any broken fences for instance with girlfriends, spouses, and other family members.

Here’s the best part. The men want to work. They are very polite, eager to learn and understand how fortunate they are to have such an opportunity.

Jackie gave a big “Thumbs up” to the men and the Hope Center Ministries. This is a notable example of ISSUES & INNOVATIONS. A novel solution to a workforce problem has been shared to the benefit of other employers. Thank you, Jackie and CID Associates, Inc. 

Housing affordability remains a problem, with no easy fixes.

The good news? Housing is more affordable in the Pittsburgh area.

By Gus Faucher, senior vice president and chief economist of The PNC Financial Services Group, 11/23/25

“The cost of living remains an important economic issue, as reflected in election results earlier this month.

One key concern is the cost of housing. The combination of big increases in house prices and much higher mortgage rates since the pandemic has many young people concerned that homeownership is out of reach.

The Trump administration has floated the idea of a 50-year mortgage that could reduce monthly payments and perhaps make purchasing a home more affordable. But there are no easy fixes to the nationwide problem of housing affordability.

The good news is that housing is more affordable, relative to incomes, in the Pittsburgh area than it is nationally..

According to a recent survey from Florida Atlantic University, 48% of Americans are very concerned about housing affordability, with 32% somewhat concerned. Two major factors have led to a big drop in housing affordability since the pandemic....

READ MORE