Mark Obenshain: General Assembly budget wrap

mark obenshainThe General Assembly returned to Richmond last week to complete the process of approving Virginia’s 2018-2020 Budget.  The end result was a budget unlike any Virginia has ever enacted.

The Senate Finance Committee crafted and approved a balanced, conservative, and fiscally responsible budget.  It included increased funding for our public schools and state-supported colleges and universities.  It provided essential increases for public safety and health and mental health care, too.  It even featured pay raises for public school teachers, state employees, and state-supported local employees like sheriff’s deputies.

The budget approved by the Senate Finance Committee made substantial deposits to the state’s Rainy Day Fund and set aside more for cash reserves, which will improve Virginia’s fiscal stability and help preserve our AAA bond rating.

The Senate Finance Committee’s budget plan met all these priorities without raising taxes.  Overall, the budget approved by the Committee would have increased spending by nearly 7% over the budget under which the Commonwealth is currently operating.  In previous years, that would be considered a generous increase.  But, a generous increase wasn’t enough for the Senate plan to win approval.  Although most Republican senators voted in favor of the Senate Finance Committee’s plan, it was rejected by a majority of the Senate.

In a sign of just how far Virginia has moved away from its tradition of conservative fiscal management, the budget that was ultimately approved increased spending by more than 11%, the greatest growth in state government spending this century. And, even worse, it doubled down on Obamacare with a massive expansion of the Medicaid program.

To cover the state’s portion of the expense of the expansion, a new $600 million tax on hospitals – twice what even the Governor proposed during regular session – was included in the budget that was approved.  Despite this new tax, calculations by the Senate Finance Committee staff indicate that Virginia’s private hospitals will actually increase their bottom lines by $1 billion under the scheme.  As with virtually all taxes, the tax will ultimately be passed thru to the consumer. This is certainly not a conservative or fiscally responsible budget that proponents claimed that it is.

This is nowhere close to the result I wanted for Virginia, which is why I was among the 17 senators – all Republicans – who voted against this plan.

This plan is adding 400,000 to 600,000 people to Virginia’s Medicaid rolls without addressing what we know are fundamental, institutional defects in Medicaid. Medicaid is already the fastest-growing expense of state government.  In just 10 years, it has grown from 14% of Virginia’s general fund expenditures to 23%, where it is currently.  Since the general fund also pays for core government services like schools and public safety, Medicaid is continuing to crowd out funding for those other services.Many who support expansion are advocates for universal government funded health insurance that has dismally failed the citizens of Canada and England.  That is not the direction in which I want this great Commonwealth to go.

While this situation does not bode well for Virginia’s fiscal future, there are some immediate effects of this budget you’ll be experiencing later this year.  Regrettably, the budget plan approved does nothing to reduce the high – and growing – health insurance premiums or its exorbitant deductibles and out-of-pocket expenses.  Most consumers should brace themselves for another hefty hike later this year, fueled by Virginia’s decision to fully implement Obamacare.

While we may have lost this fight, I remain steadfast in supporting sound fiscal policies that improve the lives of my constituents here in the Shenandoah Valley and around the Commonwealth.  I do not believe growing government run programs are the answer to a broken healthcare system – or any system for that matter.  I will continue to fight for limited government, free-market principles, and personal responsibility and I hope you will join with me in this fight.

Although a budget was approved, the Special Session is not over yet.  There are some judicial vacancies that still have to be filled.  We are presently scheduled to return to Richmond on June 11 to work on judges and address any amendments to the budget the Governor may send down.  As always, do not hesitate to contact my office if you have any questions or if you may need assistance with a state government related matter.  Our district office number is 540-437-1451 and email is mark@markobenshain.com


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