Shapiro’s budget boosts public education funding

School choice advocates see little expansion

Gov. Josh Shapiro signed a $50.8 billion state budget bill into law on Sunday, including a record $11.8 billion for public schools across the Commonwealth -- roughly a 6% increase from last year's budget.

But school choice advocates saw a budget that preserved existing programs and offered little expansion.

The education debate comes as Pennsylvania continues to grapple with improving student outcomes, addressing funding disparities between school districts and balancing investments in public schools with expanding school choice options.

The final budget includes a third installment of $565 million in adequacy funding for underfunded school districts, continuing the state's response to a 2023 Commonwealth Court ruling that declared Pennsylvania's school funding system unconstitutional. The funding is intended to help close the state's estimated $4.5 billion adequacy gap, or the amount identified as necessary for underfunded districts to provide students with a constitutionally adequate education.

"Public school spending continues to increase despite shrinking enrollment. The Pennsylvania budget failed to expand choice for kids and families by failing to increase tax credit scholarships for the first time in a decade," said Nathan Benefield, Chief Policy Officer for the Commonwealth Foundation, a conservative nonprofit.

The state's two school choice tax credit programs -- the Educational Improvement Tax Credit (EITC) and Opportunity Scholarship Tax Credit (OSTC) -- remain flat-funded at $575 million after Democratic lawmakers proposed reducing funding and increasing oversight through House Bill 2632, sponsored by Rep. Nikki Rivera, D-Lancaster.

The Commonwealth Foundation estimates that roughly 101,000 Pennsylvania students received tax credit scholarships during the 2023-24 school year. But because the legislature sets annual funding caps for the programs, about 70,000 additional students remain on waiting lists, according to the organization's 2026 report.

As a result, school choice advocates viewed maintaining current funding levels as a victory, particularly after proposals to scale back the programs. Still, the budget agreement stops short of expanding school choice by neglecting to opt Pennsylvania into the new federal scholarship tax credit program.

"House and Senate Republicans stood up for kids and protected the successful EITC after Gov. Shapiro and House Democrats tried to dismantle it. These cruel and chaotic cuts would have taken scholarships away from thousands of Pennsylvania's most vulnerable students," Andrew Lewis, president & CEO of the Commonwealth Foundation, shared in a statement.

"Rather than attacking popular programs that are working for Pennsylvania families, Gov. Shapiro should embrace the new federal scholarship tax credit -- which he can do without permission of House Democrat leadership or teacher union executives -- and expand opportunity for more Pennsylvania students at no cost to state taxpayers."

Shapiro has said he is "awaiting federal guidance to address key questions" surrounding the Trump-backed federal tax credit program, which was passed last summer as part of the One Big Beautiful Bill. Several other Democratic governors across the country have shared similar concerns.

With the deadline to join the federal program set for the end of the calendar year, neighboring states such as Ohio and New York have already opted in or signaled plans to do so, increasing pressure on Shapiro to act.

The budget package does include a significant policy change for cyber charter schools through House Bill 1505, sponsored by Rep. Liz Hanbidge, D-Montgomery, which amends the Public School Code to establish new student safety requirements.

The provisions were initially outlined in House Bill 2602, the Cyber Student Safety Act, which passed the House Education Committee with a party-line vote in June. The legislation aims to ensure students receive safety and well-being protections comparable to those available in brick-and-mortar schools, according to the co-sponsor memo circulated by Rep. Peter Schweyer, D-Lehigh, the majority chairman of the House Education Committee.

Schweyer said in a statement that he was ultimately pleased with the budget deal outcome.

"The General Assembly and Gov. Shapiro came together and passed a balanced, bold, and bipartisan budget that puts students and communities first. This budget continues our constitutional obligation to ensure schools are fairly funded and that all students, regardless of where they live, have the opportunity to succeed," he said. "This budget plan continues the massive and highly successful investments in our students and includes many policy changes that will help keep our children safe and healthy."

Public school advocacy groups praised the School Code's updated requirements.

"The School Code closes loopholes that bad actors in the cyber charter industry have exploited over the past year. Cyber charters will no longer be paid if they enroll habitually truant students in violation of the law," said Susan Spicka, the Executive Director of Education Voters, a nonprofit public education policy and advocacy organization. "We applaud the lawmakers who worked very hard on this legislation, which we hope will finally ensure that cyber charter students are safe, learning, and actually attending school."

The law expands requirements for student wellness checks and increases oversight of student safety. Schools may conduct wellness checks either in person or electronically, including through webcam participation during live online instruction, virtual health screenings, standardized testing or other school-sponsored activities.

If a student misses a wellness check, schools must continue attempts to make contact. After three days, they must schedule a wellness review conference, and if the student or parents do not participate, the school must conduct an in-person wellness check within 24 hours.

The bill also requires cyber charter schools to submit their wellness policies to the state Department of Education for approval by March 1 and, once approved, post those policies on their websites.

In Pennsylvania, there are 14 cyber charter schools. During the 2023-24 academic term, these institutions provided virtual instruction to a student population totaling nearly 60,000 statewide.