SENATOR MUSTO ANNOUNCES PASSAGE OF ECONOMIC STIMULUS PLAN AS “A NEW ERA IN PENNSYLVANIA”

HARRISBURG, March 31, 2004 – With the General Assembly’s passage of a multifaceted, comprehensive economic stimulus plan, Pennsylvania will become a strong economic force once again, state Sen. Ray Musto (D-Luzerne) announced today.

Today, the House voted 188-7 in favor of the bill, and the Senate approved the legislation unanimously in a late evening session. The bill has been sent to the Governor.

“What the people of our legislative district – and our state – need most are steady jobs that pay competitive wages,” Musto said.

Since January 2001, Pennsylvania’s unemployment rate has risen from 4.2 percent to 5.3 percent, and population and job growth rates have consistently ranked among the lowest in the nation, Musto noted.

As part of Gov. Ed Rendell’s Plan for a New Pennsylvania the economic stimulus package would utilize more than $1 billion in grants, bonds and loan guarantees over the next three years, leveraging an estimated $5 billion in private investment.

Last year, Musto was the original sponsor of a key piece of the economic stimulus program, Business In Our Sites, which has been incorporated into the final legislation. This initiative would provide $300 million in grants and loans for municipalities to develop or revitalize local land and reclaim former mining sites.

“I believe our economic stimulus plan can become the linchpin for a new era in Pennsylvania,” Musto added.  

“We can’t wait for the federal government to bring us out of this period of economic stagnation. Through these state-sponsored grant and loan programs, we will help to spur private investment and bring promising job opportunities across the state.”

Other major components of the plan include:

§         The creation of the Commonwealth Financing Authority, a seven-member board, which would be responsible for overseeing and distributing $1.135 billion in grant and loan funds for local economic development initiatives.

§         The creation of the First Industries Program, which would provide $150 million in grants and loans to boost the state’s agriculture and tourism industries.

§      The creation of the New Pennsylvania Venture Guarantee Program, which would provide $250 million in guarantees to venture capital partnerships for investments in state-related companies in the early to mid-stage of development.

§      The creation of the Building Pennsylvania Program, which would provide $150 million in loans to fund managers for investment in Pennsylvania real estate projects.

§      The creation of the Tax Increment Financing Guarantee Program, which would provide $100 million in guarantees for tax increment financing (TIF) bonds and other indebtedness.

§      The creation of the New Pennsylvania Venture Capital Investment Program, which would provide $60 million in loans to venture capital partnerships for investment in Pennsylvania-related companies.

§       The amendment of Pennsylvania’s Base Retention and Conversion (BRAC) program to include a provision that funding appropriated to the Department of Community and Economic Development (DCED) for the Base Retention and Conversion Pennsylvania Action Committee may be used for any one of the following: development of a statewide strategy or grants for economic studies; infrastructure needs assessments; or identification of job training needs.