Bill > HB1105

This bill requires the Pennsylvania state government to implement zero-based budgeting (ZBB), a budgeting method where every program and expenditure must be justified from "zero" base each budget cycle, rather than simply incrementing the previous year's budget. The bill mandates that the Secretary of the Budget subject every state government program to a zero-based budget review at least once every five years, with approximately one-fifth of the budget being reviewed annually starting in 2026. Agencies must submit comprehensive zero-based budget plans that include detailed information about their discrete activities, including legal justification for each activity, potential adverse impacts if discontinued, expenditure requirements at minimum and current service levels, and a ranking of activities based on their contribution to the agency's overall goals. The bill's findings highlight that traditional incremental budgeting can lead to perpetuating outdated programs and excessive budget growth without thorough fiscal review. In 2026, the Governor will be required to submit a zero-based budget for agencies representing at least 20% of the General Fund budget. The primary goal is to ensure more rigorous and purposeful government spending by forcing agencies to continuously justify their existence and funding levels. The act will take effect 60 days after passage.

Budget and Finance

https://www.legis.state.pa.us/cfdocs/billinfo/bill_history.cfm?syear=2025&sind=0&body=H&type=B&bn=1105