The governor decided not to fight over the car tax. However, he did signal a willingness to fight over other things, such as energy and immigration.
Gov. Glenn Youngkin also is hedging his bets against a possible recession, which might or might not be triggered by President Donald Trump’s makeover of one of the state’s biggest employers: the federal government.
That’s my reading of how the governor dealt with the 917 bills that the General Assembly sent his way — including amendments to the two-year state budget. The governor vetoed 157 bills and sent back amendments on 159 others. For the budget, he marked out eight provisions with line-item vetoes and wants to take on 205 amendments.
Given that some of these amendments were still popping up on the General Assembly website late Tuesday afternoon and even many legislators hadn’t had time to read them, I won’t claim that this is a comprehensive list. Near as I can tell, though, these may be the 15 most important things the governor did or wants to do:
1. “No car tax” becomes “no fight over the car tax.”
Youngkin had channeled his inner Jim Gilmore (the former governor who made “no car tax” his signature slogan) when he proposed in December a three-year tax credit plan to address what remains of what Youngkin called “the most hated tax in Virginia.” Youngkin ran into some of the same political and budget realities that confronted Gilmore in the late 1990s: First, the so-called car tax isn’t a state tax, it’s a local tax, so any local government could abolish it right now if they wanted. They don’t because they need the revenue, so any state plan to do away with the tax relies on the state using its budget surplus to make local governments whole. Second, just because we have a fat surplus now to draw from doesn’t mean we’ll always have such a surplus. Not even Republican legislators seemed particularly enthusiastic about Youngkin’s tax credit plan. Instead, the Democratic-controlled legislature passed a one-time tax rebate and the governor has let that stand. Those checks are due to be cut in October, so they’ll arrive in the midst of the campaign to elect Youngkin’s successor. That will give both sides a talking point: Democrats can claim credit for the rebate; Republicans can say those checks are due to prudent fiscal management — and that if it hadn’t been for Democrats, they’d be larger.
2. Youngkin wants to make the Democrats vote on immigration.
In his original budget proposal, Youngkin included language directing localities to comply with U.S. Immigrations and Customs Enforcement detainers or risk losing state funding. That provision didn’t make it out of committee in the General Assembly. Now Youngkin wants it back in. This is one of those things that Republicans think is good policy but may also be good politics: They’d love to force Democrats in the General Assembly to cast a vote that can be used in the fall as showing their support for “sanctuary cities.” Given the partisan makeup of their districts, most Democrats won’t have to worry about any negative consequences of such a vote, but Republicans hope some Democrats in swing districts do.
3. There’s a battle over energy policy looming.
Republicans have made it clear for a long time, but especially during the recent session, that they don’t like the Clean Economy Act and its requirement that the state’s utilities go carbon-free by 2050. (Disclosure: One of those utilities, Dominion Energy, is one of our donors, but donors have no say in news decisions; see our policy.) The governor has fought a way to bring that argument to the forefront. He took a bill dealing with energy storage and has sent it back with a sweeping substitute that would remove that carbon-free provision from the Clean Economy Act. In the terse language of the law: “56-585.5 of the Code of Virginia is repealed.” Or, as some on the other side read it, “The Clean Economy Act is gutted.” There is zero chance that the Democratic-controlled General Assembly will go along with this, but now we can expect more battles like this — especially as a) the demand for electricity grows, b) resistance to solar power grows in rural areas, and c) it is becoming increasingly clear that Virginia is going to have trouble meeting those carbon-free goals unless the state does something dramatic, such as mandate that rural localities start accepting solar projects.
Youngkin also vetoed a lot of other energy-related bills or sent them back with substitutes that would undo their purpose. He said a program to encourage electric vehicle charging stations in rural areas was unnecessary because there are federal programs that already do this; that bill was vetoed. He said a bill that would have allowed utilities to create their own charging stations was “misguided” and sent it back with a substitute that would ban the very thing the bill was trying to authorize. He wrote that federal programs exist to promote charging stations and, besides, “the ever-present ability for private industry to construct charging stations as is done by many such as Buc-ee’s, Sheetz, etc.” is a better way to go.
The governor also vetoed a bill that would have created a training program for offshore wind workers. (Dominion is building an offshore wind project off the coast of Virginia Beach.) Youngkin said the state already has workforce training programs, making this provision redundant. However, his veto message added: “The offshore wind industry has been hit with project contract cost increases and project cancellations running rampant across the East Coast and declining interest even for projects in Europe.” What he doesn’t mention: Some of those project cancellations along the East Coast have come after Trump issued an executive order to ban further development of offshore wind.
At the heart of this is a philosophical dispute: how much government should direct energy policy (with an eye toward achieving certain climate goals) and how much should be left to the free market to figure out (knowing that the free market may value short-term financial returns over long-term environmental ones).
The bottom line, at least politically: Republicans would love to have a fight over the Clean Economy Act.
4. We’ll get another fight over the Regional Greenhouse Gas Initiative, too.
If there’s anything Republicans hate as much as the Clean Economy Act, it’s the Regional Greenhouse Gas Initiative, known as RGGI, or “Reggie,” for short. Proponents see RGGI as a way to create financial incentives to move away from fossil fuels; opponents see it as a tax that gets passed onto ratepayers. Youngkin has tried to pull the state out of RGGI; that’s now tied up in court. Youngkin wants to move $50 million of RGGI funds to use for flood relief. Democrats say he can’t do that.
5. Youngkin did all the expected things on some high-profile bills.
The governor had seen some of these bills before and the outcome was the same. Legalizing retail sales of cannabis? Vetoed, again. Setting up a Prescription Drug Affordability Board? Vetoed, again. New gun laws? Vetoed, again. Increasing the minimum wage? Yes, again. No one should be surprised by any of that. Nor should anyone be surprised by his actions on some other bills. Collective bargaining for public employees? Definitely vetoed.
Likewise, some of the governor’s budget amendments weren’t big surprises, either. For instance: Youngkin likes lab schools; Democrats in the General Assembly don’t. He included money, they took it out, now he wants it back in.
Those on the other side of those issues may be unhappy but they shouldn’t be surprised.
6. The governor wants to add a conscientious objection clause to the contraception bill.
One bill that stirred controversy during the General Assembly was a measure that would establish a right to obtain or engage in contraception. State Sen. David Suetterlein, R-Roanoke County, had proposed an alternative that included a “conscience clause,” but that was brushed aside. Democrats then engineered a tie vote to force Lt. Gov. Winsome Earle-Sears, the likely Republican nominee for governor, to vote against the contraception bill (then quickly revived it using a parliamentary maneuver and passed it, pleased that they had created a talking point for the governor’s race). Youngkin has sent the bill back with a conscience clause similar to the one Suetterlein proposed. Specifically, “no private institution or physician, or any agent or employee of such institution or physician, shall be prohibited from refusing to provide contraception or contraceptive procedures, supplies, or information if such refusal is based upon religious or conscientious objection.”
The political challenge to Democrats: They can vote against this substitute and risk winding up not having any right to access.
7. Virginia Military Institute is now a full-fledged partisan issue.
Maybe it has been for a while, but it really is now. The state military school in Lexington had wanted money for a Center for Leadership and Ethics, but that funding request wasn’t included in what the legislature passed. Some Republicans at the time wondered whether this was Democrats’ way of putting pressure on the VMI Board of Visitors to renew the contract of Superintendent Cedric Wins; Democrats said lots of university funding requests didn’t get included. If this a Democratic attempt to sway the VMI board, it didn’t work, because the board voted not to renew Wins’ contract. That move has infuriated a lot of Democratic legislators, at least one of whom is openly talking about defunding the school entirely. (See my column on this.) Youngkin has proposed an $80 million amendment for the building. This appears to be the single biggest item the governor wants added. Given the way Democrats feel about VMI right now, the odds of this getting approved seem low. VMI is at risk of finding itself in the political wilderness in a way no other state university has been before. (For one on this, see Senate Majority Leader Scott Surovell’s comments about VMI in this story by Cardinal’s Elizabeth Beyer).
8. Acknowledging economic uncertainty, governor wants a bigger “rainy day” fund
Youngkin has been engaged in a rhetorical battle with General Assembly Democrats over what Trump’s downsizing of the federal government means for the Northern Virginia economy and, with it, the Virginia economy at large. About 42% of the state’s general fund revenues come from Northern Virginia, so what happens in Northern Virginia has a ripple effect on state funding all the way out to the Cumberland Gap. Now there’s much chatter nationally — some of it from Trump himself — about whether his economic policies will prompt a recession. Multiple indicators, including a recent Roanoke College poll, show consumer confidence sinking, which is never a good sign.
In a message accompanying his budget amendments, Youngkin obliquely says “we acknowledge a broadening aperture of the risk window.” That’s a fancy way of saying he sees a greater risk of an economic downturn than he did before. Accordingly, he wants to add $300 million to the state’s “rainy day” fund. Politically, the significance here is Youngkin acknowledging, in a practical way, that the economic forecast may not be as sunny as we like. Many of the budget changes he’s proposing are being made with an eye toward finding that $300 million.
9. Youngkin wants more money for school construction, but not through local taxes.
One issue that’s faded from view over the past few years has been school construction, which is not to say that the need has gone away, just that there hasn’t been a big partisan or regional fight over it ever since a deal in 2022 that came up with state funding for what historically has been a local responsibility. Even as he was trimming spending to come up with that extra money for the rainy day fund, Youngkin was finding another $50 million for school construction.
However, he vetoed — once again — a bill that would have given localities the ability to hold a referendum on whether to raise the sales tax for school construction. Only nine localities currently have that power: Charlotte, Gloucester, Halifax, Henry, Mecklenburg, Northampton, Patrick and Pittsylvania counties and the city of Danville. That will stay that way for the time being. “Any proposal that increases the cost of living and the cost of business is not a policy we should pursue,” the governor said in his veto message.
10. Youngkin makes another push on economic development.
During his campaign for governor, Youngkin promised a “rip-roaring economy,” and some of his most unheralded moves have been in the economic development realm. He’s paid close attention to the state’s demographic trends and takes great pride in pointing out that the state has reversed its net out-migration and now has two straight years of more people moving in than moving out. (For more on all this, see some of our demographic coverage.) He’s also been a champion of Virginia spending more on site development. During Ralph Northam’s term as governor, it became clear that other states in the Southeast are spending much more than Virginia to get large tracts “shovel-ready” for prospective employers. One reason why the Southern Virginia Megasite in Pittsylvania County lost the 8,100-job Hyundai plant to Georgia was that the Peach State had a site ready for construction and we did not. Accordingly, while Youngkin was nipping here and tucking there to find that extra $300 million for the rainy day fund, he also managed to find a way to double the funding for the Business Ready Sites program, taking it from $20 million to $40 million.
The governor also added a $20 million loan for the Roanoke-Blacksburg Regional Airport to extend a runway, a key economic priority in the region so the airport can handle bigger jets. He’s also come up with a way to get $1 million into the Virginia Sports Tourism Grant Program that the legislature created. (State Sen. Chris Head, R-Botetourt County, was the Senate sponsor of that measure.) While that’s a statewide initiative, it’s one that would be particularly important to communities that have promoted themselves as destinations for travel ball tournaments, such as Salem and Botetourt County.
However, it’s curious that, to get there, Youngkin proposes cutting the funding for one economic development project in half. The budget the General Assembly passed includes $15 million for a data center project in Pulaski County (there’s not much else known about this). Youngkin proposes cutting that to $7.5 million. Pulaski’s county administrator, Jonathan Sweet, said he didn’t know yet what the impact of that proposed cut would be.
Another economic-related project that saw its funding trimmed was the Virginia Tech Carilion School of Medicine in Roanoke. The legislature had added $6.5 million to increase enrollment; the governor cut that to $5 million. (Carilion is also one of our donors; see the same disclosure above.)
11. The governor wants to cut or defund lots of small projects.
Maybe some of these would have gotten Xed out anyway, even if the governor hadn’t been looking for ways to come up with that $300 million for the rainy day fund. I didn’t spot any projects in Southwest or Southside that got struck out, but here’s an example of some elsewhere that were: The legislature had approved $100,000 for Norfolk for surveys to determine whether the Titustown neighborhood is eligible for designation as a historic district. The governor wants to take that out. The Tonsler League, a basketball league in Charlottesville, was due for $250,000. Not if the governor has his way. One small (in terms of dollars) project that would have had a big impact statewide was $76,008 for the state to identify lynching sites and designate them as historical landmarks.
12. Tuition caps are back in the news.
Youngkin wants to cap tuition increases for in-state students at state universities at 2.5% or the rate of inflation. Democrats have generally been cool to such moves, saying this amounts to micromanaging colleges. A tuition cap or a tuition freeze is a good bumper-sticker slogan, but holding down tuition is only one part of the equation — if schools are left free to raise room and board or other expenses, such as mandatory athletic fees.
13. The governor wants to set up a mechanism for the state to acquire one of James Monroe’s homes.
Our fifth president had many homes. One of those was Oak Hill in Loudoun County. The property is currently in private hands but the aging owners want to sell it to the state, at a discount, for a state park. The legislature wrangled over whether the state could afford this. The argument against: The state’s got no expertise in owing a historic house and this could wind up being expensive. The argument for: You don’t get many chances to preserve the home of a Founding Father.
Youngkin made an unannounced visit to Oak Hill and has come down on the side of legacy — with some financial stipulations attached. His proposed budget amendment doesn’t offer any money toward the purchase but sets out a framework by which the state could acquire the property. Besides many procedural requirements, the governor wants to see a “comprehensive funding plan that includes confirmation of $52,000,000 of nongeneral fund resources to fully support the acquisition and subsequent development and operation of the proposed park, including $22,000,000 from Loudoun County, up to $18,000,000 in state and federal nongeneral funds, and at least $12,000,000 in philanthropic and private sector support.”
14. Youngkin really wants to see a plan for the New College Institute in Martinsville.
The governor has been skeptical of the higher ed center, which has had a controversial breakup with the nonprofit foundation set up to support it. Youngkin wanted to defund the institute and require a business plan that includes looking at the option of either closing or merging with another entity. The legislature took that out. The governor wants it back in. His proposed amendment also would require NCI to cooperate with that foundation it’s become estranged from.
15. The governor wants to keep the industrial development authority in Front Royal the way it is.
This should have been one of those routine local bills the General Assembly deals with every year — and it was, until it had the misfortune of coming up for a vote immediately after a partisan fight in the state Senate over a proposed change to the Virginia Beach charter. Unhappy that Republicans had not supported the measure, state Sen. Aaron Rouse, D-Virginia Beach, proceeded to kill the next Republican bill that came up — which happened to be this one. The bill, sponsored by Del. Delores Oates, R-Warren County, would have simply extended the legal authority for Warren County to be part of Front Royal’s industrial development authority. (There’s a long, sad history behind why this bill was necessary, which I dealt with in a previous column.) With the bill deep-sixed, that authority was set to expire this summer. Youngkin has revived it by making the measure a budget amendment. That may not be the most important bill statewide, but it is one that’s pretty important in Front Royal and Warren County.
We have a longer list of bills and the governor’s actions here.
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