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March 2025

The Hill Report

Representing the interests of more than 3,000 members across Pennsylvania, the Manufacturer & Business Association's Government Affairs is your voice on local, state and federal issues.

What's in This Newsletter

Just the Facts From a Pro-Business Point of View

"An informed citizenry is the foundation of a democracy."

  • LEGISLATIVE PANEL: April 24th with Congressman Kelly and Senator Laughlin
  • ISSUES SHARED - Workforce: Western Pennsylvania Steel Fabricating, Inc.
  • GOOD NEWS - The Grow PA Scholarship Grant Program
  • TARIFF WATCH -Trump Tariffs as of 3/18/2025
  • STATE - Key Takeaways from Several Budget Hearings
  • FEDERAL - Government Shutdown Averted
  • 2024 MBA State of the Association

STATE UPDATE

Overview Governor Shapiro’s 2025-26 Budget



Governor Josh Shapiro’s ‘s 2025-26 State Budget proposal calls for $51.474 billion in public expenditures and sizable increases in Education, Human Services to name a few. His proposal would increase state spending by $3.6 billion, an increase of 7.5% compared to the current year’s budget.

 

To balance the budget the Governor seeks $1.6 Billion and $2.8 Billion from the state surplus. He is counting on new revenue from legalization of adult recreational use of cannabis and the regulation of skill games. Those sources, however, have not been agreed upon by lawmakers in both chambers. 

 

Rep. Jim Struzzi, Chair, House Appropriations, said questions were asked – “What are you doing to save taxpayer dollars, become more efficient, and more accountable?” …We must take the harness off of the energy issue. The Regional Greenhouse Gas Initiative is challenging. Jobs and industry have left Pennsylvania. That’s $7 Billion going to Ohio and Texas due to permitting issues…Stop over-regulation and allow the industry to grow.”

He noted important parts of the budget discussion will include school choice, energy, government reform to the permitting process, and removal of red tape.

 

Key Takeaways from Several Budget Hearings

 

Pennsylvania Department of Transportation (PennDOT):

  •  “Republicans focused their questions on government efficiency, the fairness of distributing state and federal funds for roads, bridges, and mass transit, and how to sustainably fund infrastructure improvements moving forward.
  •  Committee members questioned Governor Shapiro’s plan to divert a total of $1.74 billion in Sales and Use Tax revenues to Mass Transit…
  • (They) expressed concerns that the majority of the $1.74 billion SUT revenue for Mass Transit would be directed to Philadelphia…


Department of Community & Economic Development (DCED):

  • House Republicans have always supported DCED's overall mission to grow our economy; however, Governor Shapiro’s FY 2025-26 budget proposal notably fails to include a strategy to grow Pennsylvania’s energy sector…Republicans focused their questions on government efficiency and unleashing Pennsylvania’s energy industry…
  • The governor’s proposal, which includes a minimum wage increase to $15 per hour, has raised significant concerns among committee members, particularly in relation to its potential impact on small businesses…”


Public Utility Commission (PUC):

  • (They) expressed concerns regarding the reliability of the PJM grid. PJM may face electricity shortages by 2026 with power plants closing and “renewable” energy unable to produce enough wattage to backfill the demand…”

 

Department of Environmental Protection (DEP):

  •   “Committee members expressed frustration with the governor’s insistence on pushing an energy tax that has already resulted in the loss of a power plant in Pennsylvania while threatening future growth.
  • The governor has refused to withdraw his lawsuit seeking to implement the Regional Greenhouse Gas Initiative (RGGI).
  • Furthermore, the governor has proposed a Pennsylvania-based carbon tax, the Pennsylvania Climate Emissions Reduction Act (PACER), which would implement RGGI-like policies under a different name…”

FEDERAL UPDATE

A Busy Week and a Government Shutdown Averted

 

The U.S. House of Representatives narrowly passed a funding bill, a CR (continuing resolution), on 3/11/25 by 217-213. The package increases defense spending by $6 billion while cutting non-defense programs by $13 billion. The changes are small considering the top line spending number of nearly $1.7 trillion. The funding bill was then passed over to the U.S. Senate.

 

The same six-month CR spending bill passed the U.S. Senate 3/14/25 in a 54-46 party line vote, with 10 members of the Senate Democratic caucus voting with the Republicans. Senate Minority Leader Chuck Schumer backed the measure to help avoid a government shutdown. Democratic colleagues in the House voiced strong opposition.

 

President Trump signed the bill into law. The funding extends through the end of September.

 

The next step is for Congress is finding a way to pay for extending Trump's $4.6 trillion in 2017 tax cuts, other tax proposals, the mass deportation of unauthorized immigrants and a boost in military spending.

ISSUES - Workforce Challenges etc.

Western Pennsylvania Steel Fabricating, Inc. (WPSF)

Fred DeFiore, President/CEO

“Your complete source for heavy plate & structural steel fabrication. Located in New Castle Pennsylvania, we are a full-service steel fabricating facility bonded and insured. With 49 years of experience, we can satisfy any steel fabrication request.”

 

Take a quick look at the WPSF website. https://wpsfinc.com/projects/ Their projects are, typically, very large and not easily recognizable, but they are critical to various market niches. They   primarily services steel mills, mining, and electric power generation. They have also provided projects for use in the nuclear and wind markets. An example of a project, recently shipped, was a ladle car which was 20 feet wide and weighed 78,000 pounds! One of the photos on the website shows an employee standing nearby, dwarfed by the fabrication.

 

Both Fred and Denise were very forthcoming in identifying their major challenge, workforce.  They do not struggle to find work. In fact, it is fair to say, that lack of workforce is a barrier to increased production. They currently employ 17 skilled tradespeople along with 5 employees who work within programming, pricing, purchasing, and general support functions. In comparison, in 2007 they had over 40 employees and were operating two shifts. Currently, they operate one shift.  

 

They are always looking for skilled tradespeople and strongly lament the lack of quality candidates. They use five staffing agencies. When candidates are hired, they work for approximately three months on the job, through the staffing agency, before a final decision is made to hire permanently.    

 

 WPSF looks for candidates proficient in various levels of mathematics, i.e., general math including fractions, geometry, trigonometry, and calculus, depending upon their position.

 

Many candidates they have interviewed over recent years, struggle to pass a basic math test. Many cannot read a standard tape measure which is extremely important to all positions.  “Schools are failing us when candidates cannot add and subtract simple equations or work with basic fractions.”  

 

WPSF hires for various positions, “Welders are, generally, easier to find than some other skills since there are quite a few vocational schools that have welding programs. Accomplished welders are not.”

 

The average tenure for production/shop employees is 10.5 years. The most tenured employee has been with the company for 46 years.

 

Examples of other positions, more difficult to hire for, are industrial fitters, quality assurance inspectors, and people proficient in reading drawings.

 

The second issue briefly discussed, was the use of fossil fuels and the perception by some that “they are dirty and harmful to the environment.” Their viewpoint is that the energy industry is dependent on fossil fuels and will be for some time. “In Pennsylvania we’re sitting on a gold mine of fossil fuels. It’s abundant and accessible. It provides good jobs for the manufacturing sector and trickles down to other market niches. Many people don’t recognize how dependent they are on fossil fuels.”

 

“Business has increased a great deal since the presidential election,” provided a transition to ask about tariffs. They noted, “We agree with tariffs and trust the wisdom and experience of President Trump. We realize that change may cause some short-term pain, but the long-range results will compensate. It’s time for America first.”

 

Fred mentioned, “WPSF customers primarily want domestic steel. In fact, if the circumstances result in the necessity of sourcing material outside the United States, we can make the client aware of what’s available and they can approve, or the client can dictate where to source it. If this is the case, the country of origin must be one who has a trade relationship with the United States.”

 

After seeing the size and weight of the pieces WPSF produces I asked about shipping. They have several trucks operating within a radius of approximately 300 miles. Freight can be provided by WPSF but, typically, clients coordinate their own logistics.  

 

I am a long-time admirer of small manufacturers. Hats off to Fred DeFiore, President/CEO, Western Pennsylvania Steel Fabricating!

GOOD NEWS

GROW PA


MBA strongly supported GROW PA legislation and is pleased to see funding is included in the 2025-2026 budget.

 

The Grow PA Scholarship Grant Program – created by Senate Republicans as part of this year’s state budget – offers grants of up to $5,000 per year for in-state students who pursue a degree or certification for an in-demand occupation. The application period for grants is open now, with funding awarded on a first come, first served basis.

 

To qualify for the grant, applicants must agree to live and work in Pennsylvania in that occupation after graduation. Grant recipients will be required to live and work in Pennsylvania for 12 months for each year they receive the grant. Failure to meet this requirement will result in the grant converting to a loan requiring repayment.

Business Magazine "On The Hill"

State of the Association: MBA Government Affairs 

The MBA educates lawmakers on issues important to small and medium-sized businesses. The MBA educates members on government and encourages engagement in multiple ways.


The MBA’s Government Affairs Division is uniquely positioned to provide members access to those who make decisions that directly affect business. Through this exclusive group, MBA members have opportunities available to meet lawmakers who share MBA’s pro-growth, pro-business stance and who are players in making policy to improve the Commonwealth’s business environment...

 

Read more

TARIFF WATCH

Moving Targets: Trump Tariffs as of 3/18/2025

 

  • Tariffs on Canada and Mexico will resume on April 2.
  • Tariffs on autos are delayed until April 2.
  • There are 25% tariffs on steel and aluminum imports from all countries.
  • Reciprocal tariffs are slated to begin on April 2.
  • Tariffs on some China imports are 20%. 
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