Pennsylvania House Bill HB891

Pennsylvania 2025-2026 Regular Session

• Introduced: 3/13/25
• Refer: 3/13/25

Caption

Providing for Keystone State Apprenticeship Tax Credit; establishing the Keystone State Apprenticeship Tax Credit Program; and imposing duties on the Department of Labor and Industry.

Summary

HB891 would create the Keystone State Apprenticeship Tax Credit Program within Pennsylvania’s Tax Reform Code and assign administration to the Department of Labor and Industry. The program is designed to encourage employers to hire and train apprentices by offering state tax credits to certified employers that participate in department-approved apprenticeship programs registered under the Apprenticeship and Training Act. The bill limits the program to non-construction trades and authorizes the secretary to allocate up to $10 million in tax credits annually from July 1, 2025 through July 1, 2030, with unused annual allocations carried forward to later years before 2030. The bill sets a tiered credit structure based on apprentice year: $2,000 for first-year apprentices, increasing to $6,000 for fifth-year apprentices. It also creates a higher credit schedule for apprentices who qualify as disadvantaged youth, with credits ranging from $5,000 to $7,000 depending on apprenticeship year. An additional $500 increase is available if a mentor has trained the apprentice for the entire calendar year. Employers may not claim this credit for an apprentice if that apprentice is already the basis for another state tax credit. The bill also requires applications, annual reporting, and public publication of program data and recommendations by the department.

Impact

HB891 would amend the Tax Reform Code of 1971 by adding a new article establishing a targeted business tax incentive for apprenticeship participation. It would impose new administrative duties on the Department of Labor and Industry, including setting eligibility criteria, reviewing applications, issuing preliminary and final certificates, monitoring compliance, and publishing annual reports. The bill would also require coordination with the Department of Revenue to share tax information for program administration, while exempting that shared information from the Right-to-Know Law. The measure would affect employers that sponsor or participate in approved apprenticeship programs, especially those in demand sectors such as health care, technology, advanced manufacturing, clean energy, and conservation. It would also create a specific incentive structure for hiring disadvantaged youth and for newly established apprenticeship programs, potentially expanding apprenticeship opportunities and shifting state tax expenditures toward workforce development.

Sentiment

No committee transcripts or recorded votes were provided, so there is no documented debate or formal voting history to gauge legislative sentiment. Based on the bill text alone, the measure appears to be framed positively as a workforce-development and youth-opportunity initiative, with the sponsor list suggesting support from multiple members. The structure of the bill emphasizes incentives, reporting, and promotion rather than restrictions or penalties, which is consistent with a generally supportive policy approach toward apprenticeship expansion.

Contention

The main policy distinctions in the bill are likely to be the size and targeting of the tax credit, the exclusion of construction trades, and the preference for certain industries and disadvantaged youth. Employers in construction would be excluded from the program because the bill limits qualified apprenticeship agreements to trades other than construction, which could be a point of concern for that sector. Another possible point of contention is the use of state tax credits to subsidize private employers, including the annual $10 million cap and whether the incentive is sufficiently targeted to produce measurable workforce gains. Administrative burden and privacy issues may also arise from the required sharing of tax information between agencies and the public reporting of employer and apprentice data.