The State Capitol. Photo by Markus Schmidt.
The State Capitol. Photo by Markus Schmidt.

RICHMOND – After a stalemate lasting almost six months, the state Senate and House of Delegates budget conferees on Friday announced that they reached a deal to amend the state’s biennial budget. At the focal point of the impasse was about $1 billion in additional tax relief legislation that Gov. Glenn Youngkin had asked for.

The deal amendment includes a one-time tax rebate of $200 for individuals and $400 for joint filers, increases the standard deduction ($8,500 for single filers and $17,000 for joint-filers), removes the age requirement for the military retiree subtraction, and it reinstates the popular sales tax holiday for school supplies that expired this year after lawmakers forgot to renew it

“The deal is one that provides Virginians with additional tax relief and unprecedented investments in education, natural resources, and behavioral health. It’s a win-win for the citizens of Virginia,” the money committees’ chairs said in a joint statement. 

However, the amended budget does not include an additional $1 billion in corporate and individual tax cuts that Youngkin has been pushing for since he rolled out his proposal in December. The legislature’s money committees released their proposed amendments to the budget on Feb. 5, and both the House of Delegates and the state Senate passed their individual budget bills.

Democrats had rejected Youngkin’s push for more tax relief, believing that last year’s historic investment of $4 billion in cuts and rebates was more than enough. They also asked for additional funding of the state’s public education system. 

In their statement, the chief budget negotiators also said that they “prioritized investments in education at all levels to ensure that our students recover from pandemic learning loss and are workforce ready.” 

In higher education, the budget deal provides for “additional operating support to maintain college affordability and increased financial aid to ensure access is not limited due to family income,” the statement said. 

Although Youngkin did not get everything that he had asked for, his spokeswoman Macaulay Porter said Friday that Virginians “welcome the news that the conferees have come to an agreement on a framework that builds on the governor’s work to deliver historic investments in education and mental health while providing significant tax relief which will reduce the cost of living in the Commonwealth.” 

Youngkin will review the final details when they are released, Porter added. 

Sen. Steve Newman, R-Bedford County, a budget conferee, said that he was “most proud of the monumental tax relief” this budget provides. “This means that the General Assembly and Governor Youngkin have provided more tax relief in the past two years than any time in the commonwealth’s history,” Newman said.

Newman added that while this has been “one of the longer budget negotiations I’ve participated in as a legislator,” he believes that the final product “benefits all Virginians and sets us on a path for continued fiscal prosperity.”

Del. Don Scott, D-Portsmouth, the House Democratic Caucus Leader, said that “the right course of action” won on Friday. 

“With their irresponsible demands for corporate tax cuts, the governor and the MAGA Republicans in the House almost derailed the entire budget process,” Scott said. “Luckily, Democrats stood strong and we were able to make them come back to the table to take care of our priorities right now.” 

Speaker Todd Gilbert, R-Shenandoah, called Friday’s announcement “encouraging.”

“While the conferees have reached a deal to present to the General Assembly, both chambers of the legislature and the public still need to review a final agreement. Additional discussions regarding a potential special session will also need to occur over the coming week,” Gilbert said in a statement.

Lawmakers and the general public alike have 48 hours to review the proposed budget amendments before the entire General Assembly will reconvene in Richmond for a vote. 

Virginia’s legislature adopts a two-year budget every other year, and unlike the federal government, the commonwealth must remain funded to avert a detrimental impact not only on the state government but localities relying on cash from the state. The biennial budget is enacted into law in even-numbered years, and amendments to it are enacted in odd-numbered years.

But when the General Assembly adjourned its regular 2023 session at the end of February, it did so without a budget deal. Instead, the legislature passed a four-page stop-gap measure to revise spending for some essential functions of the government funded as budget negotiations continued.

Del. Terry Austin, R-Botetourt County, said that more details will be made available next week.

Markus Schmidt is a reporter for Cardinal News. Reach him at markus@cardinalnews.org or 804-822-1594.