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Pennsylvania Budget Stalemate Delays Third School Payment as Districts Turn to Loans

Talks remain stuck over a structural deficit with transit funding pulled from negotiations.

Overview

  • Pennsylvania missed another monthly K–12 payment on Thursday, pushing the impasse to nearly three months past the June 30 deadline.
  • The Pennsylvania State Education Association estimates districts are awaiting about $3.76 billion in state aid after the third missed disbursement.
  • Districts are borrowing to cover operations, including the School District of Lancaster’s $35 million loan that carries roughly $200,000 in fees and interest.
  • School leaders report spending and hiring freezes and warn of potential cuts to special education and technical positions as they press lawmakers in Harrisburg.
  • The divide centers on revenue of about $46.4 billion versus a $49.9 billion spending plan, with Senate Republicans resisting and the House set to reconvene next week as a pay-freeze bill for state officials circulates.