Gov. Josh Shapiro signed Pennsylvania’s 2026–27 state budget on Sunday, July 12, 2026, a $50.8 billion bipartisan spending plan that boosts education and avoids broad tax increases, but once again leaves mass transit agencies, including Lehigh Valley’s LANTA, without a structural funding fix.
Budget Signed After a Rushed Weekend Vote
The General Assembly passed the spending plan on Sunday afternoon with only a handful of opposing votes from each party, sending it immediately to the Governor. The final budget comes in at roughly $2.4 billion less than what Shapiro had requested in his February address. It represents a 1.4 percent increase over the prior fiscal year and relies heavily on accounting maneuvers, spending down unused or underused dedicated funds, to address a structural deficit rather than introducing new revenue streams. Recreational cannabis legalization and skill-game regulation, both proposed by Shapiro as revenue sources, were not included.
Transit Funding Deferred, Again
The most consequential omission for Lehigh Valley commuters is the absence of any long-term fix for mass transit funding. Shapiro had proposed increasing the share of state sales tax revenue flowing to transit agencies from 4.4 percent to 6.1 percent, but that change was not enacted. A two-year fail-safe provision in the deal is set to expire next year, forcing lawmakers to revisit the question in the 2027 legislative session. For now, agencies like LANTA are left to manage with existing resources.
LANTA Already Stretched Thin
LANTA, which serves roughly 11,000 daily riders across Lehigh and Northampton Counties, entered this budget cycle in a precarious position. The authority had already cut service by 5 percent across 13 bus lines and raised fares in March, citing the ongoing state funding uncertainty. With no new long-term money secured, officials had previously discussed tapping capital funds as a stop-gap to avoid deeper cuts.
Education Gets a Substantial Boost
The budget’s education provisions are more favorable. The signed plan commits $11.85 billion in major K-12 education subsidies, a nearly 35 percent increase compared to before Shapiro took office. The overall education increase totals more than $678 million, including $565 million through the bipartisan adequacy and tax equity formula, $58 million more for basic education, $55 million more for special education, and an additional $10 million for career and technical education.
At a Glance
- Gov. Shapiro signed the $50.8 billion 2026–27 state budget on July 12, 2026.
- The budget is a 1.4 percent increase over the prior fiscal year with no widespread tax increases.
- No long-term transit funding solution was enacted; a two-year fail-safe expires next year.
- LANTA had already cut service 5 percent on 13 bus lines and raised fares this spring.
- K-12 education subsidies total $11.85 billion, up nearly 35 percent since before Shapiro took office.
- Education funding rises by more than $678 million overall.
