June 2nd Legislative Update

-   State lawmakers returned to the Capitol Monday to begin the June session leading up to the budget deadline on the 30th. Governor Shapiro’s $53.2 billion budget, a 5.4% increase over last year, faces strong opposition from Republicans, who say it would leave taxpayers picking up the bill for years. The proposed budget would drain more than half of $7.8 million in the state’s Rainy Day Fund and would borrow $1 billion to strengthen the energy grid, tackle housing shortages, and upgrade local government facilities. It also comes in the context of a data center tax credit that, if sustained, is projected to cost the state $188 million in 2026-27.
​-  The Pennsylvania State House of Representatives approved a bill on Tuesday that would ban students from using cellphones during school day. House Bill 1814, approved by a 126-75 vote, would require school boards to enact policies barring cellphone use but allows for local officials to prescribe sanctions.  The State Senate approved a similar bill in February, increasing the likeliness of a final compromise bill. 26 other states have already enacted similar bans, including Ohio and New Jersey.
-         State Treasurer and Republican candidate for Governor Stacy Garrity called for a moratorium on data center development last Thursday, diverging from Governor Josh Shapiro. Garrity called for a “pause” on the approval of new data centers, marking a shift in her stance and the first time that two candidates have taken opposite positions on the topic. Last week, Shapiro called for a number of guardrails that would allow for resource-friendly  development of data centers.
-              The U.S. Department of Labor has formally rescinded the Biden administration’s 2024 overtime rule, officially restoring the federal salary thresholds established under a 2019 rule for white-collar overtime exemptions. The action, announced May 15, follows federal court rulings in Texas last year that struck down the 2024 regulation and the DOL’s subsequent decision to withdraw its appeals of those decisions earlier this month. As a result, the federal minimum salary threshold for most executive, administrative, and professional employees classified as exempt from overtime will remain at $684 per week, or $35,568 annually. The threshold for the highly compensated employee exemption will remain at $107,432 annually.

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