HB 2097 — An Act amending Title 72 (Taxation and Fiscal Affairs) of the Pennsylvania Consolidated Statutes, providing for Commonwealth capital improvement plans, for duties of State agencies, for debt limit for capital projects, for prohibition on exceeding debt limit for capital projects and for legislative oversight; and making an editorial change.

PRINTER'S NO.   2693

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 2097
                                               Session of
                                                 2025

     INTRODUCED BY GROVE, HAMM, GREINER, KAUFFMAN AND GILLEN,
        DECEMBER 9, 2025

     REFERRED TO COMMITTEE ON APPROPRIATIONS, DECEMBER 9, 2025


                                    AN ACT
 1   Amending Title 72 (Taxation and Fiscal Affairs) of the
 2      Pennsylvania Consolidated Statutes, providing for
 3      Commonwealth capital improvement plans, for duties of State
 4      agencies, for debt limit for capital projects, for
 5      prohibition on exceeding debt limit for capital projects and
 6      for legislative oversight; and making an editorial change.
 7      The General Assembly of the Commonwealth of Pennsylvania
 8   hereby enacts as follows:
 9      Section 1.    Title 72 of the Pennsylvania Consolidated
10   Statutes is amended by adding parts to read:
11                                  PART I
12                          PRELIMINARY PROVISIONS
13                                (Reserved)
14                                 PART II
15                                 TAXATION
16   Chapter
17      17.    (Reserved)
18                                CHAPTER 17
19                                (Reserved)
20      Section 2.    Title 72 is amended by adding a part heading
 1   immediately preceding Chapter 31 to read:
 2                                    PART III
 3                                 FISCAL AFFAIRS
 4      Section 3.    Title 72 is amended by adding a chapter to read:
 5                                  CHAPTER 100
 6                              CAPITAL PROJECTS
 7   Subchapter
 8      A.    General Provisions
 9      B.    Capital Improvement Plans
10                                  SUBCHAPTER A
11                             GENERAL PROVISIONS
12   Sec.
13   10001.   Definitions.
14   § 10001.   Definitions.
15      The following words and phrases when used in this chapter
16   shall have the meanings given to them in this section unless the
17   context clearly indicates otherwise:
18      "Capital project."     Any of the following:
19            (1)   A project which is financed or funded or is proposed
20      to be financed or funded by the issuance of bonds, notes or
21      other evidences of indebtedness of the Commonwealth or a
22      State agency.
23            (2)   A project which is financed or funded or is proposed
24      to be financed or funded by an appropriation in the General
25      Appropriation Act and designated as a capital expenditure by
26      the laws of this Commonwealth or under standards prescribed
27      by the State Treasurer.
28      "Legislative action."      Any of the following:
29            (1)   A vote by a standing committee of the Senate to
30      report a capital budget bill out of the standing committee of

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 1      the Senate.
 2            (2)   A vote of a standing committee of the House of
 3      Representatives to report a capital budget bill out of the
 4      standing committee of the House of Representatives.
 5      "Plan."     The Commonwealth capital improvement plan prepared
 6   under section 10002 (relating to Commonwealth capital
 7   improvement plans).
 8      "State agency."     An executive or administrative department,
 9   office, public authority or other instrumentality of the
10   Commonwealth. The term includes a board, commission or agency of
11   the Commonwealth that is authorized to incur debt or issue bonds
12   under the seal of the board, commission or agency.
13                                SUBCHAPTER B
14                          CAPITAL IMPROVEMENT PLANS
15   Sec.
16   10002.   Commonwealth capital improvement plans.
17   10003.   Duties of State agencies.
18   10004.   Debt limit for capital projects.
19   10005.   Prohibition on exceeding debt limit for capital
20                  projects.
21   10006.   Legislative oversight.
22   § 10002.    Commonwealth capital improvement plans.
23      (a)     Duties of Governor.--
24            (1)   The Governor shall annually prepare a Commonwealth
25      capital improvement plan containing the Governor's proposals
26      for expenditures on capital projects. No later than February
27      1 of each year, the Office of the Budget shall post the plan
28      on the Office of the Budget's publicly accessible Internet
29      website for review and comment by the public.
30            (2)   No later than February 1 of each year, the Governor

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 1      shall submit a copy of the plan to the State Treasurer,
 2      Auditor General, Independent Fiscal Office and members of the
 3      General Assembly.
 4      (b)   Contents of plan.--The plan shall include all of the
 5   following:
 6            (1)   A detailed list of capital projects that the
 7      Governor recommends to be commenced, continued or completed
 8      by each State agency within the next three fiscal years.
 9            (2)   The fiscal impact of the capital projects
10      recommended under paragraph (1) on future operating expenses
11      of the Commonwealth, including the Governor's recommendations
12      on methods to fund the capital projects, and the
13      prioritization of the capital projects.
14            (3)   A schedule for the next fiscal year of the
15      Governor's recommendations for the appropriation of funds
16      from the issuance of bonds authorized under the laws of this
17      Commonwealth.
18            (4)   A review of capital projects that have recently been
19      commenced, continued or completed or are in the process of
20      being commenced, continued or completed.
21            (5)   The Governor's recommendations on the maintenance of
22      each State agency's physical properties and equipment of
23      State agencies.
24            (6)   The Governor's recommendations on the use of
25      properties specified under section 10003(7) (relating to
26      duties of State agencies).
27            (7)   A report on the cost of the Commonwealth's overall
28      debt for the previous fiscal year and the current fiscal year
29      and the estimated cost for the next five fiscal years,
30      including all of the following:

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 1                (i)    The outstanding general obligation debt and debt
 2          service costs.
 3                (ii)    The costs of leases and installment obligations
 4          for capital projects.
 5                (iii)    The costs of long-term liabilities as recorded
 6          in a schedule of long-term debt changes, including bonded
 7          and nonbonded debt changes, in the Commonwealth's annual
 8          comprehensive financial report under section 701 of the
 9          act of April 9, 1929 (P.L.177, No.175), known as The
10          Administrative Code of 1929.
11                (iv)    The unfunded actuarial accrued liability for
12          the Commonwealth's retirement systems and postretirement
13          medical and other benefits.
14          (8)   An assessment of the Commonwealth's ability to
15      increase the Commonwealth's overall debt and the Governor's
16      recommendation on the amount of the increase in the
17      Commonwealth's overall debt. In developing the assessment and
18      recommendation under this paragraph, the Governor shall
19      consider the criteria used by municipal securities rating
20      services in rating the Commonwealth's debt obligations and
21      any other information that the Governor deems relevant to the
22      assessment and recommendation.
23          (9)   The certified debt limit for capital projects under
24      section 10004 (relating to debt limit for capital projects).
25   § 10003.   Duties of State agencies.
26      No later than October 15 of each year, a State agency shall
27   provide the Governor and the members of the General Assembly
28   with all of the following:
29          (1)   A detailed list of capital projects that the State
30      agency seeks to commence, continue or complete for the State

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 1      agency's purposes in the next three fiscal years.
 2          (2)   The impact of the capital projects under paragraph
 3      (1) on future operating expenses of the State agency and
 4      relevant supporting data.
 5          (3)   Economic forecasts of the State agency's capital
 6      projects that will be commenced, continued or completed in
 7      the four fiscal years after the capital projects under
 8      paragraph (1) are completed as may be necessary for all of
 9      the following:
10                (i)    The adequate presentation of the State agency's
11          capital projects.
12                (ii)   Compiling a schedule for the planning,
13          implementation or construction of the State agency's
14          capital projects.
15          (4)   A schedule for the next fiscal year of the State
16      agency's requested appropriations of funds from the issuance
17      of bonds authorized under the laws of this Commonwealth.
18          (5)   A report with information on the State agency's
19      capital projects that have been recently commenced, continued
20      or completed or are in the process of being commenced,
21      continued or completed.
22          (6)   A report with information on the maintenance of the
23      State agency's physical properties and capital equipment.
24          (7)   The status of real property owned or leased by the
25      State agency and the current or future availability of the
26      real property for other uses by the Commonwealth.
27          (8)   Any other information requested by the Governor or a
28      member of the General Assembly regarding the State agency's
29      capital projects.
30   § 10004.   Debt limit for capital projects.

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 1      (a)     Certification.--No later than December 1 of each year,
 2   the Auditor General shall certify the debt limit for capital
 3   projects funded by the issuance of bonds for the previous fiscal
 4   year to ensure that the cost does not cause the amount of all of
 5   the Commonwealth's net debt outstanding to exceed one and three-
 6   quarters times the average of the annual tax revenues deposited
 7   in the previous five fiscal years in accordance with section 7
 8   of Article VIII of the Constitution of Pennsylvania. The Auditor
 9   General shall provide the certification to the Governor, State
10   Treasurer and Independent Fiscal Office and post the
11   certification on the Department of the Auditor General's
12   publicly accessible Internet website.
13      (b)     Quarterly analysis.--The Auditor General shall provide a
14   quarterly analysis of the debt limit for capital projects under
15   subsection (a) to the Governor, State Treasurer and Independent
16   Fiscal Office and post the quarterly analysis on the Department
17   of the Auditor General's publicly accessible Internet website.
18   § 10005.    Prohibition on exceeding debt limit for capital
19                  projects.
20      In order to enforce the provisions of section 7 of Article
21   VIII of the Constitution of Pennsylvania, all of the following
22   apply:
23            (1)   The General Assembly shall not pass a capital budget
24      bill with expenditures that exceed the debt limit certified
25      by the Auditor General under section 10004 (relating to debt
26      limit for capital projects).
27            (2)   The Governor shall not approve a capital budget bill
28      with expenditures that exceed the debt limit certified by the
29      Auditor General under section 10004.
30            (3)   The State Treasurer shall not pay for expenditures

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 1      in a capital budget bill with expenditures that exceed the
 2      debt limit certified by the Auditor General under section
 3      10004.
 4   § 10006.    Legislative oversight.
 5      (a)     Hearings.--The Appropriations Committee of the Senate
 6   and the Appropriations Committee of the House of Representatives
 7   shall hold no fewer than three hearings on the plan before
 8   taking legislative action on a capital budget bill.
 9      (b)     Fiscal notes.--A copy of the certification under section
10   10004(a) (relating to debt limit for capital projects) shall be
11   attached as part of the fiscal note for a capital budget bill.
12      Section 4.    This act shall take effect immediately.




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