(The Center Square) – About two months into a Virginia legislative special session, the General Assembly passed a compromise budget bill Friday evening that will head to the governor’s desk.
Despite both chambers agreeing on most of the funding priorities, leadership needed to resolve different approaches on funding sources and specific allocations in a conference committee. The compromise bill includes additional funding for education, broadband expansion, utility assistance and potential bonuses for state employees.
Lawmakers passed a skeleton budget earlier this year that maintained essential funding but gutted several proposed initiatives because of revenue shortfalls expected from the response to the COVID-19 pandemic. The budget passed today keeps some of those initiatives out but incorporates others in light of improving projections.
Senate Finance and Appropriations Committee Chairperson Janet Howell, D-Reston, said Friday lawmakers had a budget everyone liked before the COVID-19 pandemic hit the country, but the state was forced to adjust spending in light of new forecasts. She said the new bill includes money for measures the state can afford to fund without using reserves to ensure the state maintains its AAA bond rating.
Virginia’s public education systems took a financial hit this year because of its reliance on sales tax revenue, which decreased as a result of the pandemic and subsequent economic restrictions. To offset these losses, the budget includes more than $90 million in one-time funding from the state’s tax on skilled gaming machines. The budget also includes funding for some K-12 initiatives that were allotted at the beginning of the year, and $60 million for higher education to maintain affordable access and $120 million worth of COVID-19 relief funding for higher education institutions.
The budget bill also incorporates language to expand flexibility in the housing trust fund, which is designed to help Virginians get access to housing if they have faced economic hardship during the pandemic. It includes $100 million in COVID-19 relief funds to assist Virginians who fell behind on their utility bills. It maintains the moratoriums, which prohibits evictions for those who’ve suffered economic hardships because of COVID-19 and prohibits utility shutoffs.
Additional broadband funding also made its way into the budget bill in response to remote learning and remote work that requires reliable internet access. The bill includes $85 million to fund the expansion, but the compromise bill did not include a House Democrat proposal to allow municipal broadband authorities to compete with private companies for state grants related to broadband expansion.
The compromise budget includes a $500 bonus for police officers and $7.5 million to help local police departments recruit and retain officers. It includes a potential bonus for state employees and a salary increase incentive for teachers, but that funding is contingent on the state having available funds.
Several criminal justice reform bills that have passed the General Assembly, or are expected to pass by the end of the day, also were funded in the budget.
The compromise budget does not include Senate-backed enabling language for a bipartisan redistricting commission that would have been contingent on a redistricting constitutional amendment being approved by Virginia voters in a November ballot initiative. Rather, senators have said Northam intends to pass this language down in the form of a budget amendment if the constitutional amendment passes, which could delay a final signature on the budget bill by about two weeks.
After the bill is sent to the governor, he is expected to offer amendments to the budget, which then have to be approved by the General Assembly.