As the Pennsylvania 2025-26 budget impasse continues, Lebanon County officials say the delay could result in major impacts for residents for 2026.
Officials reported to the county commissioners during their Nov. 6 meeting that if they don’t have a budget soon from state lawmakers, officials will run out of funds by the second week of January 2026. County Administrator Jamie Wolgemuth said the county has been using funds normally set aside to cover the beginning of fiscal year 2026 to pay for expenses in 2025 since state funds have not come through.
The county had originally set aside funds through March 2026, but Wolgemuth said the county has used those “from back to front.”
“What I see here is, we’ve used about $6 million in set aside cash,” Wolgemuth said to the commissioners. “We are owed at this point by the state somewhere around $11 or $12 million that we have not received.”
Since the 2025-26 fiscal year started on July 1 without a budget in place, billions of dollars in payments have not been distributed to counties, schools, nonprofits and various other municipalities and programs. The state House, with a Democratic majority, proposed a more than $50 billion plan. The GOP controlled Senate proposed a budget around $47.9 billion.
If state legislators are not able to finalize a budget soon, Lebanon County officials would have to tap into reserve funds of close to $8 million that Wolgemuth described as an “absolute rainy day Armageddon fund.” Even if the county were to tap into that reserve, they would run out of funds by the second week of January 2026.
“If there isn’t something in place by the beginning of December, I’m going to have to start to prepare to borrow in January,” Wolgemuth said during the meeting. “And we would be borrowing against our ability to tax, which is what the collateral is. It’s the ability to tax millage.”
In preparing for the 2026 county budget, officials already acknowledged there is a deficit of more than $5 million that is being addressed for the next fiscal year. When the Lebanon Daily News asked Wolgemuth after the meeting if the lack of a state budget may cause a tax increase for county residents in 2026, he said it could.
“What I typically do is try to cover the gap, the deficit, with that set aside money that we’ve now used,” he said. “While we have a reason to believe the state will eventually pay us back that $12 million I mentioned, if the budget changes, if they make it a smaller budget and cut, then I don’t know how much of that we’ll get back.”
Officials acknowledged that several other counties, including Dauphin, Berks and Lancaster, have ceased paying their social service providers during the budget impasse. Wolgemuth said Lebanon County is still paying service providers “100%,” with no suggestion yet by officials to cut any services.
But county officials said that if state lawmakers don’t come together to pass a 2025-26 state budget soon, officials will have to consider other revenue options for 2026.
“I’ve never budgeted on IOUs before, but that’s kind of where we are,” Wolgemuth said.
Comprehensive plan hearings
Lebanon County officials are inviting residents to participate in two public forms during the week of Nov. 10 to gather community input on development trends and future planning priorities for the county comprehensive plan. Senior Planner Michelle Brummer, from Gannett Fleming, said holding the forums next week is very timely.
“We’ve just come off some local elections, and people, I hope, have been thinking about their communities, the leadership, and how that leadership will influence the future of those communities,” she said to the county commissioners. “So I think it’s, in fact, timely that we follow on with ‘and where do we go from here?’ kinds of conversations.”
Forums scheduled to discuss the county comprehensive plan include:
- Wednesday, Nov. 12 from 4 p.m. to 6 p.m. at the Lebanon County Department of Emergency Services at 1805 Cornwall Road, Lebanon.
- A virtual public forum Thursday, Nov. 13 from 6 p.m. to 8 p.m. Residents willing to participate must contact Brummer at mbrummer@gftinc.com, with the subject FORUM, by 6 p.m. Nov. 12.
“This will not be the only opportunity for the public to weigh-in on the future of Lebanon County,” she said. “We’ll have additional forums next year, as we are further into plan development (and) offering what we think are some of the directions and some of the choices we need to face in particular. But that will happen next year. This is a starter conversation.”
Officials are planning to file their first milestone report on the comprehensive plan by the end of the year, which will be published on a Lebanon County comprehensive plan website. While the site had not gone live as of Nov. 6, Brummer said the site will be linked on the county’s website, lebanoncountypa.gov, when it is completed.
The Lebanon County Comprehensive Plan is expected to be completed in 2026.
