I am at the State Capitol in Richmond today to consider and no doubt pass a conference committee report on the budget year for the biennium beginning July 1, 2022. If that seems close, it truly is. Historically the budget bill has been passed in March or April in time for local governments and state agencies to ready their plans for the coming fiscal year. There was never really a concern that the General Assembly would not pass a budget in time that would have shut down the government. The elongated process this year resulted from differences between the House and Senate and a new governor that needed to be resolved before a budget could be passed.
Unique to this year and to every year after an election for governor is the fact that the outgoing governor in his last act in office presents a budget for the next two years that will be presided over by the incoming governor. Governor Northam presented a budget that may have been the best I have seen since being in office. He was advantaged by having some of the strongest revenue projections in recent years with the economic bounce back from the pandemic and with the billions in pandemic relief from the federal government. He proposed to spend these monies on increased spending on education, mental health programs, environmental protection, and other progressive programs while fully funding the rainy-day fund and substantial reserves before the fund.
Governor Youngkin came into office with promises to cut several different taxes. Virginia being a balanced budget state had to reconcile the differences in the two positions with the State Senate largely following the Northam budget and the House of Delegates Republican majority agreeing with many of the tax cutting proposals of the new governor. The differences have been the subject of study by a conference committee working since early March to work out the differences.
While the details of the conference committee report are not available to me as I write this column, there are several basic principles that the report represents. The legislative action on the report will signal the direction of the Commonwealth for the next couple of years and for the coming decades. Will Virginia invest in its future with excellent education and health programs or will the state be willing to follow in the back of the line to more progressive states? It would not be prudent to fund new programs in years when revenues are flush that could not be sustained in years that are economically harder. The opposite situation isn’t prudent either—cutting taxes in years when tax revenues are high but not be able to afford those cuts when revenues decline.
The session today will produce a budget that nods in both these directions. Schools and teachers will get more funding as will mental health programs. The governor will get some tax cuts that he made speeches about although not to the level he sought. Once again the state will be funded for the next two years even if it is just in the nick of time!
Ken Plum is a member of the Virginia House of Delegates.
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