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Virginia House and Senate release budget proposals

From left, Senator Finance and Appropriations Chair Louise Lucas, Senator Creigh Deeds, Senator Mamie Locke and Senator Dave Marsden attend the release of the Virginia Senate's budget.
Brad Kutner
/
Radio IQ
From left, Senator Finance and Appropriations Chair Louise Lucas, Senator Creigh Deeds, Senator Mamie Locke and Senator Dave Marsden attend the release of the Virginia Senate's budget.

The Virginia House and Senate released their budgets for the next two years Sunday. Both documents differ from Governor Glenn Youngkin’s proposed budget released late last year.

There are some similarities between the two new budget proposals, and some significant differences.

Both plans add over $1.5 billion to the governor’s proposed education budget, with some of the funds going towards a 2.5% raise for employees over the next two years, hitting the goal of paying Virginia teachers above the national average. They also add to Youngkin’s spending in mental health, with both aiming for more than 3,300 Medicaid waiver slots among other health and human services priorities.

Both proposals also add to law enforcement and public safety budgets, in addition to more funding for deferred capital investment projects which are construction ready. Construction-ready projects will accrue more debt if not sooner finished, those close to the budgeting process explained.

The House specifically mentioned raising all state employees, or those supported by state funds, to at least $15 an hour in line with a broader goal to raise the state’s minimum wage to $15 by 2026.

“We all feel like we’ve done some great work,” said House Appropriations chair Delegate Luke Torian.

Botetourt-area Republican Delegate Terry Austin, the new ranking member of House Appropriations after Delegate Barry Knight’s removal from the committee last week, agreed with Torian’s bipartisan assessment. But the inclusion of funds from the Regional Greenhouse Gas Initiative, a multi-state environmental compact Youngkin is trying to remove the state from, was one point Austin said he and his fellow Republicans were concerned with.

“That’s the direction they wanted to go in, they are the majority party,” Austin said. “Certainly our party took issue with that previously, but I support the budget.”

Youngkin has asked state agencies to remove Virginia from the deal which has brought in hundreds of millions to address environmental issues in the state, like flooding. He claims it's an undesirable tax. But he's currently being sued over the departure, and budget language in the House could ensure the state stayed involved.

And where do the two chambers' budgets differ?

The House mentions the creation of the Virginia Cannabis Control Authority, funded with about $20 million dollars over two years. This assumes the successful passage of enabling legislation to create a legal weed market in Virginia. Notably, no income from a new market was included as early revenues are expected to immediately go to support new weed businesses.

The Senate has some skill game language, but not enough to “make everyone happy,” said Senator Louise Lucas, the chair of the Senate Finance Committee. She’s also the chamber's biggest champion for the gambling machines which filled gas stations before they were banned by the Supreme Court of Virginia.

Lucas also threw a curveball at Youngkin’s arena project. Not only did she further threaten its future, she also pulled any funding for the Washington Area Metro Transit Authority.

“Metro needs to get its act together and deal with their resources because we cannot continue to dump money into Metro,” Lucas said, before referring to herself in third person: “Louise Lucas is the chair of Senate Finance now and the money for Metro is zero.”

Metro funding was believed to be key to the Alexandria-based arena project, suggesting local stops would need upgrades to meet the new project's influx of traffic.

The House offered $160 million for Metro, and that offer will likely be used as a bargaining chip going forward, especially considering the House has the arena creation language in both the budget and in a so-far passed bill waiting to get heard in the Senate.

But Lucas wasn't all rain on Youngkin's arena parade; her budget includes toll relief for those making less than $50K a year. It would offer those under that income level 14 free toll rides a week, as well as clear out all known debt to the state's tolling authorities. Lucas didn't have final numbers on the proposal when asked Sunday.

But ranking Senate Appropriations Republican Ryan McDougle appeared to bring Lucas’s comments — and both chamber's lofty budgetary requests — back to earth.

“There are a lot of positives but there’s still some areas that still need to be worked on,” the Mechanicsville-area Senator said.

Both budgets will have to pass in their respective chambers before a compromise budget is reached through a secretive conference process. When a conference budget is agreed upon, it'll then go to Youngkin. Another secretive conference process will unfold before a final budget is agreed upon by all parties.

Youngkin will also have the ability to line item veto what he doesn't like, among other gubernatorial privileges.

Still, McDougle pointed to education funding and salary increases for Commonwealth’s Attorneys as points where the two sides met.

He also said the Senate's budget was more structurally sound. “There’s some tax policy places where we have disagreements,” McDougle added.

The lack of “legislating through the budget” was also on his list of high points.

On the new revenue side, all three budgets add a tax to digital services, which means Virginians are likely to pay more for Netflix or other digital media downloads in the near future. The Senate version appears to expand that to business-to-business digital services as well.

But Youngkin’s proposed increase of about 1% on the state’s sales tax is missing from both House and Senate budgets.

In a statement, Youngkin appeared to ignore his original tax-increasing proposal and suggested “Virginians can’t afford another tax increase.”

He instead stressed new tax relief.

“Today is just the start, and I am confident that working together with the General Assembly we can continue the progress we’ve made in our first two years and move the Commonwealth forward together,” Youngkin said.

This report, provided by Virginia Public Radio, was made possible with support from the Virginia Education Association.

Brad Kutner is Radio IQ's reporter in Richmond.