10/08/2025 | Press release | Distributed by Public on 10/08/2025 17:41
NOTE: Senate Republican leaders held a press conference about the state budget this afternoon. Video is available here.
HARRISBURG - Pennsylvania counties, early education programs, rape prevention and domestic violence prevention centers could pay no interest on loans from the Pennsylvania Treasury under legislation approved by the Senate today, according to Senate President Pro Tempore Kim Ward (R-39), Majority Leader Joe Pittman (R-41) and Appropriations Committee Chair Scott Martin (R-13).
Under current law, the Pennsylvania Treasurer may provide investment loans during a budget impasse but must charge interest on those loans. Treasury's Budget Bridge Loan program would provide up to $500 million in low-interest loans from the Liquid Asset Pool Investment Fund for county governments, domestic violence and rape crisis centers, Head Start agencies and approved providers under the Pre-K Counts program.
Those investment loans would cover up to 25% of a recipient's state budget appropriation from the previous fiscal year.
Senate Bill 1040 would authorize the state treasurer to waive interest charges on loans issued during a budget impasse and help prevent additional costs for taxpayers and communities.
"Senate Republicans advanced important legislation today to support Treasurer Garrity's Bridge Loan Program by offering forgiveness on the interest rates on those loans under section 301.1 of the fiscal code," Ward said. "These low interest loans will help alleviate financial pressures on counties, early education, rape and domestic violence programs and the program has been approved by the Pennsylvania Attorney General's Office. I applaud this bold and innovative approach offered by Treasurer Garrity and am pleased we can support this measure as we work through a budget that is balanced and does not raise taxes on Pennsylvanians."
"Our caucus has been very consistent and clear since the day the governor announced his budget proposal that we have significant concerns not only fiscally, but also as it relates to policy matters that are critical to changing the trajectory of our future," Pittman said. "While we continue working to enact a complete 2025-26 budget, Senate Bill 1040 grants the treasurer the ability to waive interest on treasury loans, lessening the burden placed on those who need this money now."
"As the budget impasse continues, we need to explore every avenue to reduce the impact on our local government partners and key service providers. It's what the Senate tried to do nearly two months ago when we passed a proposal to get funding flowing to all entities that rely on state funding while negotiations continue," Martin said. "While we continue to fight for a fiscally responsible budget that acknowledges our Commonwealth's financial reality, waiving interest on these loans makes sense to ensure more of these dollars can help Pennsylvanians."
The legislation specifies that a budgetary impasse includes periods beginning July 1, 2025, and July 1, 2026, and ending on the effective dates of the General Appropriations Acts for the 2025-26 and 2026-27 fiscal years.
The bill now moves to the House of Representatives for consideration.
CONTACT:
Erica Clayton Wright (Sen. Ward)
Kate Flessner (Sen. Pittman)
Jason Thompson (Sen. Martin)