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State Updates from the PA Chamber

New Unemployment Compensation Trust Fund projections show Pennsylvania employers are well-positioned to avoid federal tax increases that were feared to be triggered next year.
Pennsylvania’s UC Trust Fund was depleted early in the pandemic when business shutdown orders and collapse of the economy prompted historic demand on the system.  The Commonwealth was ultimately forced to borrow from the federal government and employers in states with debt after two years are subject to automatic tax increases that rise annually until the debt is paid off.  For Pennsylvania employers, this would have meant paying hundreds of millions of dollars beyond the billions in UC taxes already paid every year.
Projections in early 2022 estimated the need for ongoing borrowing from the federal government over the next several years to the tune of nearly $1.5 billion. The PA Chamber successfully advocated for the legislature to utilize federal American Rescue Plan dollars to replenish the trust fund, though it was feared more funding might be necessary to avoid borrowing and tax increases.
Over the last several months, however, as hiring has increased and UC claims have decreased, the trust fund status has gradually improved. Now, the PA Department of Labor & Industry reports that the outstanding loan balance has been paid in full and that they project “no need to incur additional Title XII loans from the federal government between now and January 1,2023.”  In other words, employers avoid tax increases that would have gone into effect in 2023.


The House of Representatives returned to legislative business this week for the first three of just twelve session days scheduled before the Nov. 8 election. The House is in this week Sept. 12, 13, and 14 and returns on Sept. 19, 20, and 21 and again on Oct. 24, 25, and 26. The state Senate will return next week, on Sept. 19, 20, and 21, and is scheduled for additional days on Oct. 17, 18, 19, 24, 25, and 26.

Several House committee meetings are scheduled this week on issues of interest to the business community. On Monday, the House Republican Policy Committee held an informational hearing on the PA Supreme Court’s recent rule change on venue rules for medical malpractice. Today, the House Environmental Resources and Energy Committee receives testimony from several representatives from business and labor on the potential economic and environmental benefits of developing hydrogen and carbon capture projects in Pennsylvania.
Tomorrow, the state’s Independent Regulatory Review Commission will meet to consider two major environmental rulemakings – one involving lower limits for manganese that may impact industrial sources with point source or stormwater discharges and another lowering NOx emissions from large sources. If the IRRC approves, the regulations will be published in a few weeks in the Pennsylvania Bulletin following formal review by the Office of Attorney General. Following an IRRC approval, the standing committees of the legislature will also have a window to move forward on any disapproval resolutions to the floor, which will ultimately require approval by the Governor or a two-thirds veto override by the General Assembly. The regulations cannot be published as final until the disapproval process runs its course.
Federal Updates from the Ridge Policy Group

Congress is Back
Both the US House and the US Senate returned to Washington in full this week with a packed agenda before November’s midterm elections, including passing billions more in Ukraine and pandemic aid. Here are some of the items on tap as Congress returns to Washington:
Stopgap Spending
The White House is seeking $11.7 billion to aid Ukraine, $22.4 billion to fight Covid-19, $4.5 billion to combat monkeypox and billions more for other items on a stopgap bill Congress must pass to keep the government running after the Sept. 30 end of the federal fiscal year.

While the bill will kick longer-term decisions on domestic and defense spending into a lame-duck session, the must-pass continuing resolution could also become a vehicle for other legislative priorities.
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