Written by Eileen Anderson, Director, Government Affairs, The MBA
Key Issues on the PA General Assembly’s Fall Agenda
I. Energy Costs and Affordability: Debates over addressing rising utility and energy costs, increasing power grid capacity, and re-evaluating related gross receipts or utility taxes continue to see legislative push as part of broader affordability concerns. Increase baseload – gas, coal, nuclear – generation, and dispatchable energy (on an off as needed) generation.
II. Data Center Expansion & The Million-Dollar Question: Lawmakers are navigating new proposals to regulate unchecked data center growth, balancing local community’s input on water usage and grid demands against the state’s economic development push. Governor Shapiro released an Executive Order (EO) for data center development. Some major points for developers include:
· First step -earn legal approval of their projects at the local level.
· Bring their own power and pay for all the costs associated with that electricity.
· Get an increasing amount of power from clean energy sources.
· In case of a grid energy emergency, data centers will be the ones who get cut off.
· Provide a community outreach plan that promotes public engagement and enables meaningful public input.
· Provide a community benefit plan detailing expected contributions to the state and local community.
· Data Center sales and Use tax exemptions are granted to those who sign a binding agreement to meet GRID standards.
· The EO removes data center projects from Fast Track Permitting.
Million-Dollar Question: What will be the impact of Gov. Shapiro’s Executive Order? PA has 100 proposed data centers. Will they stay in PA or go to another state?
Adapted From Gemini: The new regulations will weed out “speculative” proposals while protecting local resources and utility rates. It is likely that many of the 100 proposed data centers will drop out or turn to other states. The EO does not ban data centers, but it implements a “pay-to-play” framework that forces developers to prove viability and community alignment before proceeding.
III. Mass Transit Funding: The summer budget deal delayed comprehensive funding solutions for public transit agencies like SEPTA & PRT, leaving lawmakers to debate long-term, stable funding streams to address rising costs and transit accessibility. They are often tied in legislative discussions to the controversial taxation and regulation of slot-like electronic skill games.
IV. Skill Games Regulation and Taxation: Following the PA Supreme Court ruling classifying skill games as illegal slot machines, lawmakers have until 10/14/26 to create a formal framework to tax and regulate the games. The games could bring in significant state tax revenue There are an estimated 70,000 electronic skill games corner stores, bars, and VFWs. Pennsylvania would be leaving as much as $1 billion a year on the table if the games aren’t taxed and regulated. Once 10/14/26, establishments must remove the games or risk criminal charges and police seizure while state lawmakers weigh potential tax and regulatory frameworks.
· Gov. Josh Shapiro wants to tax the machines at 52%, much like slots in casinos.
· Skill-game makers hope to pay just 16%, or a $500 per-machine per-month fee.
· Senate Republican leadership wants 35%-36% gross revenue tax.
V. Adult-Use Recreational Marijuana: Legalizing and taxing adult-use cannabis is still a prominent point of discussion for generating recurring state revenue and closing long-term structural gaps, though consensus has lagged in the divided legislature. The MBA is opposed.