HARRISBURG, Pa. - A state senator says he's found a way to help balance the Commonwealth's budget and spend more on education without raising taxes on low and middle-income taxpayers.

Pennsylvania's constitution doesn't allow legislators to tax the same kinds of income at different rates.

But Marc Stier, director for the Pennsylvania Budget and Policy Center, says a bill proposal by Democratic Senator Art Haywood to raise taxes on certain kinds of income that mostly go to the wealthy would be allowed.

"We calculate that if we tax that second class of income at four percent rate, it would bring in about $788 million, which gets us about halfway to closing the structural deficit," says Stier.

That "second class" of income would include business income, dividends, capital gains, rents and several other kinds of income that most people don't receive.

The state currently is facing a structural deficit of $1.8 billion.

According to Stier, under Haywood's bill the 60 percent of households with incomes below $65,000 a year would pay between $2 and $28 a year more in taxes.

And those with incomes up to $200,000 would pay an extra $118 a year.

"On the other hand, the top one percent, people making $463,000 or more, would pay an additional $5,304 a year," says Stier. "And they're the ones who can afford it."

The Senate bill, S 1258, is based on a proposal the Budget and Policy Center brought forward last month.

When all state and local taxes, including sales tax, are taken into account, the lowest 20 percent of households in Pennsylvania currently pay about 12 percent of their income in taxes, while the top one percent pay only about four percent.

Stier says most states try to balance that by taxing high incomes at a higher rate.

"We can't do that in Pennsylvania," he says. "And that's why we're one of the 'Terrible Ten,' one of the 10 worst states in terms of tax fairness in the entire country."

Senator Haywood introduced the bill on Wednesday. What happens next is up to the leadership in both houses of the Legislature.


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The Indiana Chamber of Commerce outlined six key priorities for lawmakers ahead of the legislative session in January.

Rather than releasing detailed policy positions, the Chamber emphasized broad focus areas, including workforce, education, economic growth, infrastructure, quality of place and community health.

Phil GiaQuinta, D-Fort Wayne, House Minority Leader, responded to the Chamber's priorities, highlighting the need to address child care as a factor in economic development.

"We talk about economic development with things that impact economic development here in the state. Child care is really one of those," GiaQuinta contended.

The organization stressed the critical role of affordable child care in workforce development, citing a report estimating Indiana loses $4.2 billion annually, including $1.7 billion in tax revenue due to child care challenges. High costs force some parents out of the workforce, straining the state's economy.

Statehouse leaders acknowledged the issue but differ on solutions. Democrats argued child care deserves more state investment, while Republican leaders believe the private sector should play a larger role.

Todd Huston, R-Fishers, Speaker of the House, said businesses should not expect the state to solve their child care problems entirely.

"They've done a lot of different things to try to support families and young families. We will continue to do that," Huston stated. "But I think we also have to set a level of expectations that we're not going to; the state's not going to be funding all universal pre-K."

The Chamber plans to release detailed policy proposals in January, aiming to guide lawmakers toward strategies to strengthen Indiana's economy and workforce.


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North Dakota is no stranger to public pension debates. States face pressure to keep retirement systems well-funded and new data show most Americans place great value on such benefits for both government and private-sector workers.

According to the National Institute on Retirement Security, 86% of Americans believe all workers, not just those employed by state and local governments, should have a pension. There are similar approval levels when asked how important public pensions are in recruiting teachers and public safety workers.

Dan Doonan, executive director of the institute, suggested it is not too surprising to see the results.

"Pensions, along with other benefits, are part of creating that culture of careers and not jobs," Doonan explained.

Starting in January, North Dakota will close its main public pension plan for new hires, who will instead be offered a 401(k)-style benefit. The move followed debate over whether it was the right way to address a $1.9 billion unfunded liability. Backers argued it protects benefits for existing workers and taxpayers but skeptics contended it makes it harder to attract workers to the public sector.

Doonan noted the survey results overlap with the idea maintaining an experienced public-sector workforce is a good thing for community members and not just the employee and employer.

"In general, when public services are done well, they're often invisible, right?" Doonan emphasized. "We want good roads, we want safe communities, and I think Americans understand the role of having career public servants in terms of delivering those outcomes."

The Bureau of Labor Statistics said state and local governments employ about 20 million workers, which represents about 13% of the U.S. workforce.

As Nebraskans anticipate the upcoming holiday season, some might also be looking ahead to the 2025 tax season, which will include a new tax credit for family caregivers, including those looking after military veterans.

Starting in 2025, a new state law provides eligible family caregivers up to $2,000 in tax credits for out-of-pocket expenses. The cap increases to $3,000 if the family member receiving care has dementia or is a veteran.

Jina Ragland, associate state director of advocacy and outreach for AARP Nebraska, said those who served have access to care benefits through the Department of Veterans Affairs but added it sometimes is not enough.

"Because some of their service-related illnesses or injuries, they extend beyond what they're able to afford, or maybe what the coverage is through the VA," Ragland explained.

She pointed out it puts more pressure on loved ones assisting them on a daily basis. During National Veterans and Military Families Month, supporters of the new law hope more families will see if they are eligible. Ragland noted while it helps reduce the financial strain, greater awareness of resources is also needed, to help all family caregivers avoid burnout.

Ragland emphasized one example is providing caregivers information about where to turn for guidance when a loved one is first discharged from a hospital. She argued entities at all levels need to maintain progress, because their outreach shows a demand for solutions.

"Over 90% of Nebraskans say that they want to age in place with the lowest level of care," Ragland reported. "In order to do that, oftentimes we have to rely on family caregivers."

There are no age restrictions to qualify for the tax credit. As for eligibility factors, the law includes an income limit of $50,000 dollars for individuals and $100,000 for married couples.