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Compromise Virginia budget plan heads for final vote

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Posted at 6:33 PM, Feb 26, 2021
and last updated 2021-02-26 18:33:26-05

RICHMOND, Va. -- Budget negotiators in the Virginia House and Senate have reached a compromise on a spending plan that funds key legislative priorities and pandemic-relief efforts, boosts the state's reserve fund and gives state workers and state-supported employees a raise.

The details of the compromise plan were posted publicly late Thursday afternoon, discussed in a Friday afternoon House meeting and expected to receive a final vote Saturday. The legislation would then move to Gov. Ralph Northam, who can seek to make additional changes.

Lawmakers are working with a brighter-than-expected revenue forecast because the state economy has held up relatively well amid the pandemic. Tax revenues strengthened beyond last year's forecasts, giving lawmakers an extra $730.2 million and allowing them to restore raises and many budget cuts that were put on hold last year amid fears that restrictions to slow the spread of COVID-19 would cripple the state economy.

“Before the pandemic, we had passed the most progressive budget in Virginia history. These additional dollars help us get back to that historic budget and allow us to move forward with our shared priorities - providing Virginia families and businesses the relief they need to get back on their feet, supporting public schools, and giving our public workers a pay raise,” Northam said in a statement earlier this month.

The compromise spending plan includes nearly a half billion dollars for compensation increases that would take effect at the start of fiscal year 2022. That includes funding for teachers, state workers and state-supported workers like sheriff's deputies to get a 5% raise. State police would see an 8% raise, plus $100 per year of service.

Del. Mark Sickles, who is vice chair of the appropriations committee, said during Friday's meeting that the extra money was needed for state police because their pay is not currently competitive, which is affecting recruitment.

“We’re the only payer of their salaries. It’s not shared with anybody else. We have 300 vacancies in the department now,” he said.

The spending plan also reflects the state's continuing efforts to combat a pandemic that's left north of 7,000 Virginians dead.

It restores funding for some programs that were put on hold at the start of the pandemic last year, including $34.5 million to implement Northam's signature G3 program to provide free or low-cost job skills training at community colleges.

It includes money to make sure school divisions that experienced a drop in enrollment due to the pandemic don't lose state aid. It spends money to keep up the fight against the spread of COVID-19, with allocations for personal protective equipment and tens of millions of dollars for mass vaccination efforts.

According to Friday's presentation to lawmakers, the spending plan would forgive an additional $90 million of debt for Dominion customers, bringing total utility debt forgiveness directed by the General Assembly to $217 million.

Lawmakers also agreed to allow tax deductions of up to $100,000 for business expenses funded with forgiven Paycheck Protection Plan loans and Rebuild Virginia grants. The House had been seeking a $25,000 cap.

Provisions of the budget fund Democrats' marquee issues for this year's legislative session. There's $6.9 million in state and federal money for a paid sick leave program for certain home health care workers and $14.6 million to fund a new policy to expand the sealing of old criminal records.

There's also money related to legislation that was still unfished as of Friday. That included proposals to legalize marijuana and expand the Court of Appeals.

The spending plan would add $900 million to state’s reserve fund. That would bring the state’s total reserves to an estimated $2.1 billion by mid-2022, according to Friday’s presentation.

Northam's spokeswoman, Alena Yarmosky, said in a statement that the General Assembly had “overwhelmingly” agreed with the governor's top budget priorities.

“We continue to review the budget, but it’s clear this is a tremendous step forward towards supporting working families, rebuilding our economy, and investing in Virginia’s future,” she said.