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PRINTER'S NO. 95
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
93
Session of
2019
INTRODUCED BY GROVE, RYAN, GREINER, BERNSTINE, JAMES, KAUFFMAN,
STAATS, IRVIN, METCALFE, DUSH, ROTHMAN, COX, KEEFER, SIMMONS,
ZIMMERMAN, STRUZZI, B. MILLER, GLEIM, SCHEMEL, JONES, GILLEN
AND HERSHEY, JANUARY 28, 2019
REFERRED TO COMMITTEE ON FINANCE, JANUARY 28, 2019
AN ACT
Amending Title 72 (Taxation and Fiscal Affairs) of the
Pennsylvania Consolidated Statutes, providing for preliminary
provisions; for taxation; and for fiscal affairs and for
Commonwealth budget procedures; establishing the Joint
Revenue Estimation Committee and the Performance-based
Incentive Account; and making related repeals.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 72 of the Pennsylvania Consolidated
Statutes is amended by adding parts to read:
PART I
PRELIMINARY PROVISIONS
(Reserved)
PART II
TAXATION
Chapter
17. (Reserved)
CHAPTER 17
(Reserved)
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PART III
FISCAL AFFAIRS
Chapter
100. Commonwealth Budget Procedures
CHAPTER 100
COMMONWEALTH BUDGET PROCEDURES
Subchapter
A. General Provisions
B. Office of the Budget
C. Budget Procedures
D. Performance, Transparency and Accountability-based
Budgeting
E. Expenditures and Lapsed Funds
F. Cost Savings and Performance-based Incentive Account
G . Implementation
SUBCHAPTER A
GENERAL PROVISIONS
Sec.
10001. Scope of chapter.
10002. Definitions.
10003. Applicability of chapter .
§ 10001. Scope of chapter.
The chapter relates to State measurement for accountable,
responsive and transparent (SMART) budgeting for the
Commonwealth.
§ 10002. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Committee." The Joint Revenue Estimation Committee
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established in section 10026 (relating to revenue estimates).
"Continuous improvement process system." A system that may
involve any of the following strategies:
(1) Developing a process map that describes the lean
government principles or another widely accepted business
process improvement system by which an executive agency
engages in specific activities that have the purpose of
increasing efficiency and eliminating waste in the processes
used to deliver goods and services to taxpayers and customers
of the Commonwealth. The term includes the measurement of the
outcomes regarding increased efficiency and the elimination
of waste and procedures by which the executive agency
produces goods or serves its customers.
(2) Engaging in specific activities to rapidly improve
the executive agency's processes that will increase value or
decrease staff time, inventory, defects, overproduction,
complexity, delays or excessive movement.
(3) Involving executive agency employees at all levels
to map the executive agency's processes and recommend
improvements, with specific importance placed on the
involvement of executive agency employees closest to the
customer or end user of the State government product or
service.
(4) Providing the means to measure each process in order
to demonstrate the effectiveness of each process or process
improvement.
(5) Training executive agency employees to mentor and
train other executive agency employees in continuous
improvement process system methodologies.
"Executive agency." Any of the following:
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(1) The Governor's Office.
(2) A department, board, commission, authority or other
agency of the Commonwealth that is subject to the policy
supervision and control of the Governor.
(3) The Office of Lieutenant Governor.
(4) An independent department.
(5) An independent agency.
"Fiscal year." The period beginning on July 1 of each
calendar year and ending on June 30 of the next calendar year.
"Independent agency." A board, commission, authority or
other agency of the Commonwealth that is not subject to the
policy supervision and control of the Governor. The term does
not include:
(1) a court or agency of the unified judicial system; or
(2) the General Assembly or an agency of the General
Assembly.
"Independent department." Any of the following:
(1) The Department of the Auditor General.
(2) The Treasury Department.
(3) The Office of Attorney General.
(4) A board or commission of an entity under paragraph
(1), (2) or (3).
"Performance evaluation." A regular review of an executive
agency's outcomes compared to its published performance goals. A
performance evaluation shall be based on actual historical
information.
"Performance goal." A specific, quantifiable goal related to
a performance measure adopted by an executive agency.
"Performance management system." A formal system of managing
the processes and operations of executive agencies.
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"Performance measure." A quantitative indicator used to
assess the operational performance of an executive agency under
a published performance plan. A performance measure must:
(1) Apply to activities directly under the influence of
the executive agency.
(2) Demonstrate the executive agency's efficiency and
effectiveness in delivering goods or services to customers
and taxpayers.
(3) Be reasonably understandable to the public.
"Performance plan." A document prepared by an executive
agency as part of a performance management system. A performance
plan must incorporate the impact of management strategies and
continuous improvement process system activities on the costs
and efficiency of delivering goods and services to taxpayers and
customers of the State government. An executive agency shall
coordinate performance plans to ensure a continuity of programs
affecting similar constituencies.
"Process map." A written or visual presentation that
describes the steps involved in producing a product or service
from beginning to end.
"Secretary." The Secretary of the Budget.
"Strategic plan." A systemic process of envisioning a
desired future and translating the vision into broadly defined
goals or objectives and a sequence of steps to achieve them.
§ 10003. Applicability of chapter .
This chapter shall not apply to any of the following:
(1) A court or agency of the unified judicial system.
(2) The General Assembly or an agency of the General
Assembly.
(3) A political subdivision.
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(4) A municipal authority or other local authority.
(5) An agency of an entity under paragraph (3) or (4).
SUBCHAPTER B
OFFICE OF THE BUDGET
Sec.
10011. Administration of office.
10012. Duties of office generally.
10013. Appointment of secretary.
10014. Salary of secretary.
10015. Program evaluation.
10016. Audit functions.
10017. Fiscal note.
§ 10011. Administration of office.
The Office of the Budget shall be an administrative agency
within the Governor's Office.
§ 10012. Duties of office generally.
The Office of the Budget shall:
(1) Continue to exercise the powers and perform the
duties vested in and imposed upon the secretary.
(2) Be centrally concerned with the development of the
budget request of the Governor and with the decisions
necessary to allocate revenues among the various Commonwealth
programs.
§ 10013. Appointment of secretary.
The Governor shall appoint a Secretary of the Budget to serve
at the pleasure of the Governor.
§ 10014. Salary of secretary.
(a) Amount.--The annual salary of the secretary shall be
$160,000 or at such higher level as is established by the
Governor with the approval of the Executive Board.
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(b) Definition.--As used in this section, the term
"Executive Board" is as described in section 204 of the act of
April 9, 1929 (P.L.177, No.175), known as The Administrative
Code of 1929.
§ 10015. Program evaluation.
The secretary shall have the power and duty to initiate and
conduct, under the direction of the Governor, evaluations of the
effectiveness and management efficiency of programs supported by
an agency subject to the policy supervision and control of the
Governor, including federally funded programs and State-funded
programs, and to direct, coordinate, assist or advise the agency
in the conduct of evaluations of the agency's programs or
programs which the agency supports. The secretary shall also
prepare reports detailing the results of program evaluations
conducted by the secretary for distribution to the Governor, the
Independent Fiscal Office, the General Assembly, interested
agencies and the general public.
§ 10016. Audit functions.
The secretary shall initiate and conduct, under the direction
of the Governor, audits of the programs supported by an agency
subject to the policy supervision and control of the Governor,
including federally funded programs and State-funded programs.
The audits shall comply with the Single Audit Act of 1984 (31
U.S.C. § 7501 et seq.) and the Office of Management and Budget
Circular A-133 and any other Federal requirements for a
Statewide single audit. The secretary shall also prepare reports
detailing the results of audits conducted by the secretary for
distribution to the Governor, the Independent Fiscal Office, the
members of the General Assembly, interested agencies and the
general public.
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§ 10017. Fiscal note.
(a) Preparation.--The Office of the Budget shall prepare a
fiscal note for regulatory actions and administrative procedures
of each executive agency receiving money from the State
Treasury. The fiscal note shall state whether the proposed
action or procedure causes a loss of revenue or an increase in
the cost of programs to the Commonwealth or its political
subdivisions.
(b) Publication.--Any regulatory action or administrative
procedure that requires a fiscal note shall be transmitted to
the Legislative Reference Bureau for publication in the
Pennsylvania Bulletin at the same time that the proposed change
is advertised.
(c) Contents.--A fiscal note shall provide the following
information:
(1) The designation of the fund out of which the
appropriation providing for expenditures for the action or
procedure shall be made.
(2) The projected cost of the action or procedure during
the fiscal year in which it is implemented and for each of
the five succeeding fiscal years.
(3) The projected loss of revenue associated with the
action or procedure during the fiscal year in which it is
implemented and for each of the five succeeding fiscal years.
(4) The fiscal history of the action or procedure for
which expenditures are to be made.
(5) The line item, if any, of the General Appropriation
Act or other appropriation act out of which expenditures or
losses of Commonwealth funds shall occur as a result of the
action or procedure.
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(6) Any recommendation of the secretary and the reason
for the recommendation.
SUBCHAPTER C
BUDGET PROCEDURES
Sec.
10021. Submission of budget information.
10022. Mid-year budget review.
10023. Balanced budget presentation.
10024. Performance hearing.
10025 . Annual performance plans.
10026 . Revenue estimates.
§ 10021. Submission of budget information.
(a) Commencement.--On July 1 of each year, the secretary
shall begin the process of obtaining and preparing the pertinent
financial and program information regarding the next fiscal year
for review by the Governor and the General Assembly.
(b) Request for information.--
(1) Not later than August 1 of each year, the secretary
shall distribute the proper instructions and blanks necessary
to the preparation of the budget requests.
(2) The request for information under paragraph (1)
shall contain a notice that the blanks shall be returned with
the information desired not later than October 1 of the same
year.
(3) The request for information under paragraph (1)
shall be distributed to the following:
(i) Each executive agency.
(ii) The Chief Clerk of the Senate.
(iii) The Chief Clerk of the House of
Representatives.
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(iv) The State court administrator.
(v) Each institution or other agency that desires
State appropriations.
(c) Return of information.--
(1) The information requested by the secretary under
subsection (b) shall be returned no later than October 1 of
the same year that the request was made.
(2) An executive agency and the State court
administrator shall designate a person to return the
information.
(3) An executive agency and the State court
administrator shall provide the same information submitted to
the secretary to a member of the General Assembly.
(d) Additional information.--In addition to the other
information submitted under this section, an executive agency
shall also submit the following to the secretary , the
Independent Fiscal Office and the General Assembly:
(1) A performance plan aligned with the executive
agency's strategic plan .
(2) An update on its continuous improvement process
system, including a detailed report on anticipated savings
reflected by line item .
(3) A strategic plan .
(4) A written statement that describes the following:
(i) The purposes of each program to be funded.
(ii) The expected levels of activity of each program
to be funded.
(iii) The expected levels of accomplishment
regarding each program to be funded.
(iv) The measures to be used to determine the extent
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that each program to be funded has achieved its stated
purposes.
(v) Each executive agency's reduction of all program
expenditures by 100% from the immediate prior fiscal year
and the rebuilding of its budget by the following
criteria:
(A) Justified mandated expenses.
(B) Performance criteria for executive agency
programs.
(e) Publication of information.--Upon receipt of a
performance plan of an executive agency, the secretary shall
make the performance plan readily accessible on the Office of
the Budget's publicly accessible Internet website.
(f) Further inquiry and investigation.--The secretary may
make further inquiries and investigations regarding the
financial needs, expenditures, revenues, expected levels of
program activities and accomplishments or other relevant matters
of any entity receiving money from the State Treasury.
(g) Determination by Governor.--After providing an entity
the opportunity to be heard regarding the information submitted
under this section, the Governor may approve, disapprove or
alter a budget request.
(h) Basis for appropriations.--Before December 16 of each
year, the secretary shall submit to the Governor in writing the
information provided under this section, along with any
additional information requested by the Governor, as the basis
for the Governor's requests for appropriations for the next
fiscal year.
§ 10022. Mid-year budget review.
(a) Review.--No later than December 16 of each year, the
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Governor and secretary shall provide the members of the General
Assembly with a review on the budget for the current fiscal
year. This review shall include, but is not limited to, the
following:
(1) Changes in current revenue projections from the
enactment of the General Appropriation Act for the
immediately prior fiscal year.
(2) State expenditures for the current fiscal year and
anticipated overages and lapses from the enactment of the
General Appropriation Act for the immediately prior fiscal
year.
(3) Reviews under this subsection shall specifically
include the following:
(i) Anticipated increases or decreases in programs,
including the specific policy, statute, Federal law,
Federal regulation, executive agency contract, executive
agency contract amendment, executive agency guideline,
executive agency approved entitlement, court case or
executive order which is the basis of the anticipated
increases or decreases.
(ii) The results or anticipated results of employee
union negotiations for salaries, wages and other
benefits.
(iii) The statistics involved in preliminary
forecasts of the major programs mandated by statute,
including, but not limited to, education subsidies,
public assistance programs, debt service and forecasts of
revenue.
(iv) The top five cost-drivers of the budget and any
executive agency recommendations to mitigate these costs.
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(v) Status on the cash flow of the General Fund.
(vi) Other appropriate budget information.
(b) Briefing by Governor.--
(1) In December of each year, the Governor shall meet
with the following:
(i) The chairperson and minority chairperson of the
Appropriations Committee of the Senate.
(ii) The chairperson and minority chairperson of the
Appropriations Committee of the House of Representatives.
(iii) The officers of the General Assembly.
(2) During the meeting under this subsection, the
Governor shall brief the individuals under paragraph (1) on
the issues foreseen as being imminent in the budget for the
next fiscal year. The Governor and individuals shall exchange
views on the issues before the budget is formally presented
to the General Assembly. The individuals shall also inform
the Governor of financial matters which should be considered
in the budget.
(c) Joint hearings.--The Appropriations Committee of the
Senate and the Appropriations Committee of the House of
Representatives shall form a joint committee to conduct a joint
hearing to review the midyear status of the finances of the
Commonwealth. The following shall be members of the joint
committee:
(1) The chairperson and minority chairperson of the
Appropriations Committee of the Senate.
(2) The chairperson and minority chairperson of the
Appropriations Committee of the House of Representatives.
(3) Three members of the Appropriations Committee of the
Senate appointed by the chairperson of the Appropriations
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Committee of the Senate.
(4) Two members of the Appropriations Committee of the
Senate appointed by the minority chairperson of the
Appropriations Committee of the Senate.
(5) Three members of the Appropriations Committee of the
House of Representatives appointed by the chairperson of the
Appropriations Committee of the House of Representatives.
(6) Two members of the Appropriations Committee of the
House of Representatives appointed by the minority
chairperson of the Appropriations Committee of the House of
Representatives.
§ 10023. Balanced budget presentation.
(a) Contents of submission.--Subject to subsection (h), the
Governor shall submit to the Independent Fiscal Office and the
General Assembly copies of original agency budget requests, all
subsequent revised agency budget requests, a State budget and
program, and financial plans that include the following:
(1) A balanced operating budget for the next fiscal year
specifying the following in detail:
(i) The amounts recommended by the Governor to be
appropriated to the General Assembly, the Judicial
Department, each executive agency and institutions and
other agencies within this Commonwealth, and for all
public purposes, classified by department or agency and
by program.
(ii) The estimated revenues or receipts from each
source and an estimated amount to be raised by taxation
or otherwise, including proposals for new revenues and
receipts.
(2) A capital budget for the next fiscal year specifying
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capital projects to be financed from the proceeds of
obligations of the Commonwealth or its agencies or
authorities or from operating funds.
(3) Program and financial plans for not less than the
immediately prior fiscal year, the current fiscal year and
the next four fiscal years, which shall include the following
for each fiscal year:
(i) Actual or estimated operating expenditures
classified by department or agency and by program, in
reasonable detail, and actual or estimated revenue by
major categories from existing and additional sources.
(ii) Clearly stated purposes of each program in
terms of desired accomplishments.
(iii) Measures used to determine to what extent each
program has achieved its stated purposes.
(iv) Actual and estimated levels of accomplishment
for each program and actual and estimated levels of
program activities and their associated costs.
(v) Clearly stated purposes for each recommended new
or revised program, measures to be used to determine
whether each new or revised program has achieved its
purpose, estimated levels of additional or new
accomplishment of each new or revised program, estimated
levels of additional activities for each program and
their associated costs.
(vi) Use of Federal funds, including requirements by
the Federal Government attached to those funds, the cost
in State dollars to meet those requirements and
recommendations to mitigate Federal mandates at a lower
cost to the Commonwealth .
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(vii) Cross references to performance measures used
to determine funding levels.
(4) Specific reasons that program increases or decreases
are occurring, including recommendations to eliminate or
reduce program increases.
(b) Program evaluation.--The budget shall include the
results of any program evaluation report or audit findings
completed by the Office of the Budget , the Independent Fiscal
Office or the Department of the Auditor General in the fiscal
year preceding the year in which the budget request is made. The
results of any evaluation report and its recommendations shall
be concisely summarized and included in the budget
documentation.
(c) New or expanded programs.--
(1) When the secretary identifies a new or expanded
program by criteria used in the budget instructions, the new
or expanded program shall be displayed and justified as a
separate item in the Governor's budget request.
(2) A new program shall not be considered to be enacted
by the General Assembly in its first year unless it is
specifically referred to or displayed as a line item in an
appropriation bill.
(3) A cost-benefit analysis shall be provided for each
new or expanded program.
(d) Cost breakouts.--The budget shall include for each
executive agency a single, separate line listing the separate
cost for each program. The line item shall include:
(1) Employee salaries.
(2) Health care costs.
(3) Pension costs.
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(4) Lease agreements.
(5) Vehicle, travel and transportation reimbursements.
(6) Consultants.
(7) Augmented employees and staff.
(8) Office supplies.
(9) Information technology.
(10) Telecommunications.
(11) Travel, meals, lodging and similar expenses.
(12) The cost of purchasing new equipment and supplies.
(13) The cost of purchasing material, including
newspapers, magazines, movies, films and tapes.
(e) Performance goals.--The budget shall include a summary
of programs by an executive agency which lists each program, if
it exceeded, met or did not meet its performance goals of the
previous fiscal year and by what percentage the program did or
did not meet its performance goals.
(f) Cash flow.--The budget shall include an analysis of the
cash flow of the General Fund and detail how the budget will
impact the cash flow of the General Fund in the ensuing fiscal
year.
(g) Documentation.--Upon the request of the Independent
Fiscal Office, the chairperson of the Appropriations Committee
of the Senate or the chairperson of the Appropriations Committee
of the House of Representatives , an executive agency shall
provide documentation of any budget request, including revenue
estimates upon which the budget estimate is based.
(h) Timeliness of submission.--The submission under
subsection (a) shall occur:
(1) Subject to paragraph (2), as soon as possible after
the organization of the General Assembly, but not later than
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the first full week in February of each year.
(2) Not later than the first full week in March of the
first year of the first term of the Governor after the
gubernatorial election.
§ 10024. Performance hearing.
(a) Applicability.--This section relates to a performance
hearing by a standing committee to review an executive agency's
proposed performance measures for the next fiscal year.
(b) Frequency.--Each standing committee shall conduct at
least one hearing between October 1 and May 15.
(c) Purpose.--Each standing committee shall hear a
presentation from each executive agency that is assigned to that
standing committee that includes, but is not limited to, the
executive agency's strategic plan and performance plan for the
next fiscal year.
(d) Public testimony.--Each standing committee shall allow
for written public testimony regarding the presentation by an
executive agency.
(e) Liaison.--The head of an executive agency shall serve as
liaison or designate an individual within the executive agency
to serve as liaison with a standing committee. The liaison shall
inform the committee of the executive agency's performance
management system and performance plan.
(f) Recommendations.--After a standing committee holds its
performance hearings, the standing committee may make
recommendations to the members of the General Assembly on
changes to performance data and recommendations for any
incentives or disincentives based on program performance
measures to use in determining the level of appropriations in
the final performance-based budget. By May 30, recommendations
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shall be submitted to the Appropriations Committee of the house
in which the standing committee is making the recommendations
under this subsection.
§ 10025 . Annual performance plans.
(a) Transmittal.--Following the presentation of the budget
under section 10023 (relating to balanced budget presentation),
each executive agency shall transmit its annual performance
report for the current fiscal year to all of the following:
(1) The Independent Fiscal Office.
(2) The General Assembly.
(b) Posting.--After transmitting the annual performance
report under subsection (a), each executive agency shall post
the annual performance report on the executive agency's publicly
accessible Internet website.
(c) Contents.--An annual performance report must include all
of the following:
(1) A summary of the executive agency's submitted
performance plan aligned to the executive agency's strategic
plan .
(2) A brief summary of the executive agency's budget
request.
(3) Performance measurements on how the executive agency
has moved toward meeting performance goals for the current
fiscal year.
(4) How performance plans have been coordinated across
executive agencies to ensure a continuity of services to
residents of this Commonwealth.
(5) Continuous improvement process system efforts from
the current fiscal year and a detailed analysis of cost
savings and service improvement.
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§ 10026 . Revenue estimates.
(a) Committee established.--The Joint Revenue Estimation
Committee is established and shall be convened by the Secretary
of Revenue no later than the first week of February following
the beginning of each legislative session of the General
Assembly.
(b) Membership.--The committee shall be comprised of the
following members:
(1) The secretary.
(2) The Secretary of Revenue.
(3) The chairperson and minority chairperson of the
Appropriations Committee of the Senate.
(4) The chairperson and minority chairperson of the
Appropriations Committee of the House of Representatives.
(5) One resident appointed by the Governor.
(6) One resident appointed by the President pro tempore
of the Senate.
(7) One resident appointed by the Speaker of the House
of Representatives.
(8) One resident appointed by the Minority Leader of the
Senate.
(9) One resident appointed by the Minority Leader of the
House of Representatives.
(10) The Director of the Independent Fiscal Office as an
ex officio member.
(c) Staff.--The committee shall be staffed by employees of
the Department of Revenue who shall prepare any documents
requested by a member of the committee.
(d) Meetings.--The committee shall meet at least once a
month to discuss changes in revenue collected by the
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Commonwealth during the current month and fiscal year compared
to the most recently released estimate made by the committee.
(e) Revenue estimates.--Twice each fiscal year, by December
16 and May 15, the committee shall prepare a joint estimate of
revenue for the General Fund. The estimate shall include revenue
the Commonwealth can anticipate collecting for the current
fiscal year and the ensuing fiscal year.
(f) Approval of revenue estimates.--No revenue estimate
shall be approved without being approved by 11 members of the
committee. The following shall apply:
(1) If, prior to final adjournment of any regular
legislative session of the General Assembly, a law is enacted
providing for additional or less money to be deposited into
the General Fund, the committee shall prepare a joint
estimate of those revenues.
(2) The committee may release a revised revenue estimate
90 days following the release of an approved revenue estimate
only if the estimate is approved by 11 members of the
committee.
(g) Submission.--The committee shall submit the revenue
estimates to the Governor, General Assembly, State Treasurer and
Independent Fiscal Office.
(h) Failure to approve estimate.--If the committee fails to
approve a revenue estimate under this section, the Governor and
the General Assembly shall utilize the revenue estimates of the
Independent Fiscal Office for approving General Fund
expenditures.
(i) Initial revenue estimate.--The secretary shall convene
the committee, which shall release a revenue estimate for the
current fiscal year and ensuing fiscal year within 30 days of
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the effective date of this section. If the committee is unable
to agree on a revenue estimate, the Governor and the General
Assembly shall use a revenue estimate from the Independent
Fiscal Office to enact General Fund expenditures for the ensuing
fiscal year.
(j) Report on error rates.--The committee shall provide a
public report on the error rates of the previous fiscal year
revenue estimates no later than October 1 of the following
fiscal year. Revenue error rates for each tax must not be
greater than 3%. If an error rate is greater than 3%, the
committee shall develop a new model to ensure error rates remain
under 3%.
(k) Duty of Governor.--
(1) Prior to signing an appropriation bill or allowing
an appropriation bill to become law without the signature of
the Governor:
(i) the revenue estimates must be completed; and
(ii) the Governor shall line item veto any part of
an appropriations bill that causes total appropriations
to exceed the official estimates plus any unappropriated
surplus.
(2) No subsequent changes in the revenue estimates shall
be made unless changes in statutes affecting revenues and
receipts are enacted.
(l) Duty of General Assembly.--The General Assembly shall
not send a general appropriation bill to the Governor unless the
General Assembly has sent legislation to the Governor providing
for the revenues and augmentations needed to fund the
expenditures in the general appropriation bill.
SUBCHAPTER D
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PERFORMANCE, TRANSPARENCY AND
ACCOUNTABILITY-BASED BUDGETING
Sec.
10031. Performance management systems.
10032. Performance plans.
10033. Performance evaluations.
10034. Performance and forensic audits.
10035. Electronic access of information and Commonwealth
checkbook.
10036. Estimates of current expenditures by certain executive
agencies.
10037. Estimates of current expenditures by independent
departments.
10038. Books and accounts.
10039. Audit of Auditor General records.
§ 10031. Performance management systems.
(a) Development.--
(1) The Governor shall develop components of a
performance management system for managing executive agencies
through instructions issued by the secretary.
(2) The Judicial Department shall develop components of
a performance management system for managing the judicial
branch through instructions issued by the Administrative
Office of Pennsylvania Courts.
(b) Contents.--A performance management system under this
section must address all of the following:
(1) Strategic plans and priorities that are consistent
with the charge of the respective executive agency or entity
within the Judicial Department.
(2) Strategies for enhancing productivity, improving
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efficiency, reducing costs and eliminating waste in the
processes and operations that deliver goods and services to
taxpayers and customers of State government.
(3) Parameters for the development of performance plans.
(4) A continuous improvement process system.
(5) Elements to ensure that employees are appropriately
trained to implement the components under this subsection.
(6) Suggested incentives for exceeding performance goals
and disincentives for not exceeding performance goals.
(c) Publication.--By July 1, 2022, and by each subsequent
July 1:
(1) The Governor shall publish the components under
subsection (a)(1).
(2) The Judicial Department shall publish the components
under subsection (a)(2).
(d) Posting.--The secretary and the Administrative Office of
Pennsylvania Courts shall post the instructions under subsection
(a) on its publicly accessible Internet website.
§ 10032. Performance plans.
(a) Development.--By August 1, 2022, and by each subsequent
August 1, each executive agency and the Administrative Office of
Pennsylvania Courts shall develop a performance plan in
accordance with the developed performance management system.
(b) Purpose.--A performance plan shall serve as a guide to
the major functions of an executive agency or the Judicial
Department and as a tool to evaluate performance goals over
time.
(c) Contents.--At a minimum, a performance plan must include
the following components regarding the executive agency or
entity within the Judicial Department:
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(1) A statement of its mission or vision.
(2) A description of its major functions.
(3) A strategic plan.
(4) Performance measures for its major functions aligned
to the executive agency's strategic plan . If reasonable and
appropriate, performance measures shall be developed with the
input of its employees.
(5) Performance goals that correspond to its performance
measures and extend to at least three years into the future.
(6) A narrative description of the strategies necessary
to meet the performance goals.
(7) A summary of its most recent performance evaluation.
(d) Revisions.--
(1) An executive agency or the Administrative Office of
Pennsylvania Courts may further refine a performance plan in
the performance management system published under section
10031 (relating to performance management systems).
(2) The secretary or another individual within the
Office of the Budget may not edit a transmitted performance
plan or any information related to the performance plan.
(e) Transmittal.--By August 1, 2022, and by each subsequent
August 1, each completed performance plan shall be transmitted
to the following:
(1) The Governor's Office.
(2) The secretary.
(3) The Independent Fiscal Office.
(4) The General Assembly.
(f) Posting.--By August 1, 2022, and by each subsequent
August 1, each executive agency and the Administrative Office of
Pennsylvania Courts shall post the completed performance plan on
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its publicly accessible Internet website and on the publicly
accessible Internet website of the Office of the Budget.
(g) Retirement systems.--The Public School Employees'
Retirement System and the State Employees' Retirement System
shall comply with the requirements of this section.
§ 10033. Performance evaluations.
(a) Distribution.--An executive agency shall conduct a
performance evaluation and distribute it to the Independent
Fiscal Office and each member of the General Assembly.
(b) Frequency.--A performance evaluation shall be
distributed at least twice each calendar year as defined in the
published performance management system.
(c) Performance checks.--The Independent Fiscal Office shall
conduct a performance check on each executive agency's
performance evaluations on a rolling five-year cycle.
§ 10034. Performance and forensic audits.
(a) Frequency.--The Department of the Auditor General shall,
within existing resources, conduct or cause to be conducted
performance audits of one or more specific programs or services
in at least two executive agencies on an annual basis during the
regular audit of the executive agency.
(b) Selection considerations.--In selecting an executive
agency and a specific program or service for a performance
audit, the Department of the Auditor General shall consider
risk, audit coverage, resources required to conduct the
performance audit and the impact of the audited program or
service on the executive agency's performance-based goals.
(c) Review.--A performance audit of a program or service
selected for audit may include, but is not limited to, a review
of all of the following:
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(1) The integrity of the performance measures audited.
(2) The accuracy and validity of reported results.
(3) The overall cost and effectiveness of the audited
program or service in achieving legislative intent and the
performance goals.
(d) Transmittal.--The Department of the Auditor General
shall transmit electronically each performance audit report for
the immediately prior fiscal year to members of the General
Assembly and the Independent Fiscal Office .
(e) Other reports.--The Department of the Auditor General
shall transmit any other audit report regarding an executive
agency that is deemed relevant for review by a standing
committee with jurisdiction over the executive agency.
(f) Forensic audits.--The Department of the Auditor General
may conduct forensic audits at the expense of the agency under
forensic audit if a prior or current audit shows alleged
criminal action, misappropriation of expenditures, misuse of
expenditures, accounting discrepancies or passage of a
concurrent resolution by the General Assembly.
§ 10035. Electronic access of information and Commonwealth
checkbook.
(a) Electronic access of information.--Except for
confidential information, the Independent Fiscal Office and the
General Assembly shall have access to all information available
on inquiry-only screens through the Integrated Central System
under section 620.1 of the act of April 9, 1929 (P.L.177,
No.175), known as The Administrative Code of 1929.
(b) Commonwealth checkbook.--The Office of the Budget shall
maintain a public version of financial information and
transactions under this chapter, which shall be known as the
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Commonwealth checkbook.
§ 10036. Estimates of current expenditures by certain executive
agencies.
(a) Preparation.--Each executive agency, other than an
independent department, shall from time to time as requested by
the Governor or a member of the General Assembly, prepare an
estimate of the amount of money required and the levels of
activity and accomplishment for each program carried on by the
executive agency during the next month, quarter or other period
as the Governor or member of the General Assembly shall
prescribe.
(b) Inclusion of other funds.--All available Federal funds
and funds from other sources shall be characterized as such and
included in the estimate under subsection (a) before any
expenditures shall be made.
(c) Submittal.--The estimate under this section shall be
submitted to the secretary for approval or disapproval and the
Appropriations Committee of the Senate and the Appropriations
Committee of the House of Representatives.
(d) Revision.--If the secretary does not approve an estimate
under this section, the estimate shall be revised as necessary
and resubmitted for approval.
(e) Personnel complement level.--The secretary may establish
an authorized personnel complement level in conjunction with the
approved estimate under this section.
(f) Prohibited spending.--After the approval of the estimate
under this section, the executive agency submitting the estimate
may not expend all or part of any appropriation, Federal funds
or funds from other sources except in accordance with the
estimate and any authorized complement level unless the estimate
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is revised with the approval of the secretary and within the
limits appropriated by the General Assembly.
(g) Failure to comply.--
(1) If an executive agency to which this section applies
fails or refuses to submit to the secretary an estimate under
this section, the Governor may notify the State Treasurer in
writing of the failure or refusal.
(2) After receipt of the notice under paragraph (1), the
State Treasurer may not draw any warrant in favor of the
executive agency until the Governor notifies the State
Treasurer in writing that the delinquent executive agency has
furnished the Governor with, and the Governor has approved,
the required estimate.
(h) Disapproval or reduction of appropriated amounts.--
(1) The secretary may not, under the authority granted
under this section, disapprove or reduce any amount
appropriated by the General Assembly for grants or subsidies
without the approval of the Appropriations Committee of the
Senate and the Appropriations Committee of the House of
Representatives.
(2) If the secretary favors the disapproval or reduction
under paragraph (1), the secretary shall give at least 10
days' prior notice to the Independent Fiscal Office, the
chairperson and minority chairperson of the Appropriations
Committee of the Senate and the chairperson and minority
chairperson of the Appropriations Committee of the House of
Representatives.
(3) The notice under paragraph (2) must include all of
the following:
(i) The amount of the appropriation to be
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disapproved or reduced.
(ii) The reasons that the appropriation should be
disapproved or reduced.
(iii) The estimated impact of the disapproval or
reduction on the programs, services or purposes for which
the appropriation is provided.
§ 10037. Estimates of current expenditures by independent
departments.
(a) Preparation.--Each independent department shall from
time to time as requested by the Governor, prepare an estimate
of the amount of money required for each activity or function to
be carried on by the independent department during the next
month, quarter or other period as the Governor shall prescribe.
(b) Submittal.--The estimate under this section shall be
submitted to the secretary for approval or disapproval and to
the Appropriations Committee of the Senate, the Appropriations
Committee of the House of Representatives and the Independent
Fiscal Office.
§ 10038. Books and accounts.
All books and accounts kept by each executive agency shall be
kept on a fiscal-year basis utilizing the full accrual
accounting method.
§ 10039. Audit of Auditor General records.
The Auditor General and the Department of the Auditor General
shall submit to any accountants appointed by the Governor for
the purpose of making an audit of the affairs of the Auditor
General and the Department of the Auditor General all books,
papers and other records that in any way pertain to that
position and department.
SUBCHAPTER E
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EXPENDITURES AND LAPSED FUNDS
Sec.
10041. Total actual revenues less than total estimated
revenues.
10042. Unexpended appropriations.
10043. Encumbered appropriations.
10044. Budget implementation data.
10045. Revenue data.
10046. Lapsed funds.
10047. Financial reports due to General Assembly.
10048. Disposition of Commonwealth assets.
10049. Tax expenditures.
10050. Special and restricted funds analysis.
§ 10041. Total actual revenues less than total estimated
revenues.
(a) Budgetary reserve.--If the Commonwealth's total actual
revenues are less than the Commonwealth's total estimated
revenues in any given month, the Governor shall place the amount
of appropriations under revenue estimates into budgetary
reserve.
(b) Reduction of line item.--In depositing the amount of
appropriations under revenue estimates under subsection (a), the
Governor shall reduce in the General Appropriation Act each line
item under the policy supervision and control of the Governor
for that fiscal year by the same percentage, excluding debt,
pension payments and court orders.
(c) Removal and allocation.--If the Commonwealth's total
actual revenues exceed the Commonwealth's total estimated
revenues for two consecutive months, the Governor may remove
appropriations in the budgetary reserve and allocate the
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appropriations of each line item in the General Appropriation
Act under the policy supervision and control of the Governor for
that fiscal year by the same percentage as long as total actual
revenues continue to exceed the total estimated revenues. Any
appropriations remaining in the budgetary reserve after October
31 of the preceding fiscal year shall expire and lapse to the
General Fund.
§ 10042. Unexpended appropriations.
By May 15 of each year, the Governor shall provide the
Independent Fiscal Office and the General Assembly with a
detailed report on all potential unexpended appropriations for
that fiscal year.
§ 10043. Encumbered appropriations.
By May 15 of each year, the Governor shall provide the
Independent Fiscal Office and the General Assembly with a
detailed report of specific appropriations of the current fiscal
year that may need to be carried over to the next fiscal year.
Each report shall also include the following:
(1) Each c ommitment for the next fiscal year by
appropriation and line item.
(2) The name of the organization to which each
commitment was made.
(3) The total amount expended during the fiscal year for
each commitment.
(4) A description of each commitment or project.
(5) The location of each commitment or project,
including the senatorial district and representative district
in which the commitment or project is located.
(6) The five-year cash flow demonstrating how each
d epartment, board, commission, authority or other agency of
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the Commonwealth that is subject to the policy supervision
and control of the Governor is planning to fund the agency's
commitments.
(7) The date that each encumbrance was approved.
(8) The schedule that each encumbrance is set to be
paid.
(9) The total amount of the encumbrances.
(10) A description of how each executive agency can fund
the encumbrances of the executive agency through budgeted
appropriations and statutory authority.
(11) A statement for each encumbrance as to whether or
not the encumbrance is to be expended by October 31 of that
calendar year and, if the encumbrance is not to be expended
by October 31 of that calendar year, an in-depth explanation
of the reason that the encumbrance will continue beyond
October 31 of that calendar year.
§ 10044. Budget implementation data.
(a) Duty.--The Governor, the Auditor General, the State
Treasurer and the Attorney General shall make monthly
expenditure data available to the Independent Fiscal Office and
each member of the General Assembly.
(b) Timeliness.--Monthly data shall be provided within 15
days after the end of each month.
(c) Presentation.--
(1) Monthly data shall be:
(i) prepared in such a way that the last monthly
submission is a summary inclusive of the preceding months
of the fiscal year; and
(ii) able to establish a history of expenditure
file.
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(2) At the discretion of the chairperson and minority
chairperson of the Appropriations Committee of the Senate and
the chairperson and minority chairperson of the
Appropriations Committee of the House of Representatives,
monthly data may be provided in a computer file.
(3) Monthly data shall be provided by fund,
appropriation, department and organization within each
department and include all of the following:
(i) The number and costs of filled personnel
positions.
(ii) Itemized personnel vacancies and their costs.
(iii) New positions created and their costs.
(iv) Wage and overtime costs.
(v) Allotments and expenditures for itemized
personnel expenses.
(vi) Allotments and expenditures for itemized
operating expenses.
(vii) Allotments and expenditures for itemized fixed
assets.
(viii) The rate of expenditures in appropriations
for major subsidy and grant programs during the month.
(d) Other budgetary data.--Upon the request of the
Independent Fiscal Office or a member of the General Assembly,
the Governor, the Auditor General, the State Treasurer and the
Attorney General shall make available to that office or member
any other budgetary data as may be requested from time to time.
§ 10045. Revenue data.
(a) Duty.--The Governor shall make monthly revenue reports
to the Independent Fiscal Office and the General Assembly.
(b) Contents of report.--A revenue report shall show the
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