Democrats on a special committee charged with exploring the effects of federal shake-ups on Virginia expressed concern with a lack of solid information from presenters from Southwest Virginia. Meanwhile, Republicans struck a more cautious tone during a meeting in Wytheville on Monday.
Republicans noted that a lot of the presentations focused on estimations and speculations of potential impacts of the federal cuts.
“The main thing that struck me today was a little room for optimism,” Del. Ellen Campbell, R-Waynesboro, said during the meeting. “I feel like we’re in a good position to handle this. I think it’s going to be a lot of what we heard today — we’re just going to continue to build on these programs we have in place, we’re going to continue to meet like this and taking the information that comes as it comes and maybe not speculate quite so much about what may happen.”
Democrats interpreted the information that they received a little differently, however.
“I don’t think it’s a matter of speculation. We have a responsibility to produce a budget here, at the end of this process,” Del. Marcus Simon, D-Falls Church, said. “It’s not that we’re just gloom and doom, we do have a responsibility to look at not necessarily the worst-case scenarios but the realistic-case scenarios. It makes our job really difficult when what we think is the lay of the land and the rules of the road on Friday, are different on Monday morning.”
Committee members heard some warnings from Southwest Virginia agency representatives, but few details on how federal cuts are impacting the region now. Monday’s meeting was the third to take place since the committee was formed by House Speaker Don Scott in February.
The topics discussed by presenters ranged from potential cuts to Medicaid and access to health care, to tourism, to tariffs and Virginia’s agricultural exports to China, increase in traffic at food pantries across the Southwest region, and how frozen federal grants affect food security, among others during the roughly 5-hour meeting.
Rita McClenny, president and CEO of the Virginia Tourism Corporation, said during her presentation to the panel that it was too early to judge tourism impacts. But, some argued, impacts are being felt in other areas.
“In Southwest Virginia, hospitals, food banks, farms, and tourism are all under strain from federal disinvestment in Medicaid, USDA programs, and rural economic development,” Del. Michael Feggans, D-Virginia Beach, said in an email. “These are not abstract policy shifts. They are direct consequences of the Trump-Musk agenda that is creating higher costs, less healthcare access, and more economic instability. Tariff volatility is hurting producers and consumers alike.”
He added that the presentations in Wytheville reinforced how rural communities are being hit hardest by federal cuts.
Effects to food services and producers
A representative from Feeding Southwest Virginia, a nonprofit that focuses on reducing hunger, noted that the organization has experienced an increase in demand for services, along with pantries and soup kitchens. Harvest Home Kitchen has seen a nearly 47% increase in traffic compared to 2024, Roanoke Neighborhood Pantry has seen a 36% increase, and the Mobile Food Pantry has seen roughly a 4% increase.
A representative from Appalachian Sustainable Development, said that their organization has seen federal grants frozen, terminated or paused and then restarted. Appalachian Sustainable Development connects agricultural producers with businesses and residents in an effort to reduce food insecurity. Those grants include:
- $42.5 million cooperative agreement, which includes 17 partners who provide support for farmers and food entrepreneurs across seven Appalachian states. This grant has been frozen since the Trump administration took office and is expected to affect 300 food businesses and 180 farmers;
- $7.6 million federal pass-through grant for fiscal year 2025 from the Virginia Department of Agricultural and Consumer services was terminated. This action is expected to cause agricultural producers to lose millions in sales, and people in need will no longer receive fresh food through the agency’s food box program;
- $500,000 grant has been terminated that would have provided direct financial assistance for the establishment of agroforestry practices to diversify farm income, increase yields, and improve resilience to challenging weather.
Jason Grant, a professor and director of the Center for Agricultural Trade at Virginia Tech, said during his presentation on the effect of tariffs that agricultural markets in Virginia and across the country are in flux due to the ongoing market upheaval. He noted that agricultural producers were “caught in the crossfire” during the 2018 trade war.
During most years, China is Virginia’s top agricultural export market, he said, and when additional tariffs are placed on imports from the U.S., three economic impacts result:
- U.S. products become more expensive, which hurts competitiveness;
- Tariffs reduce or discount U.S. output or export prices; and
- Agricultural producer returns, or farm incomes, decrease.
Trade negotiations between the U.S. and China are ongoing.
Medicaid, health care access and unemployment updates
The U.S. House Energy and Commerce Committee unveiled its spending bill late Sunday night, which would cut spending by $880 billion over 10 years. That bill includes significant cuts to Medicaid. The committee is expected to vote on the legislation as early as Tuesday. Congress is also anticipated to add work requirements for those seeking coverage through Medicaid.
As of May 3, 917 federal workers have filed claims for unemployment insurance in Virginia. As of May 3, 797 individuals associated with the top 100 federal contractors have filed claims for unemployment insurance, according to data presented to the panel.
Representatives from the Virginia Department of Medical Assistance Services pointed out that Virginia’s tax on hospitals to fund Medicaid expansion and supplement payments is currently set at 6%, and any reduction in provider tax will lower reimbursement to 63 private acute care hospitals. They also noted that new tariffs apply to medical supplies like medical devices, syringes, masks, respirators and gloves.
Don Halliwill, executive vice president and chief financial officer for Carilion Clinic, noted that potential impacts of federal cuts to health care programs and services could cause a reduction or elimination of services, which could lead to hardships for patients; could cause the clinic to recruit and retain fewer employees; could decrease reinvestments in medical care, community health, medical and nursing education, research and innovation; and could cause increased costs for health care services through commercial insurance contract negotiation. (Disclosure: Carilion is one of our donors but donors have no say in news decisions; see our policy.)
The special bipartisan committee met for the first time on the last day of the 2025 legislative session, to gain an understanding of the current landscape shaped by the first few weeks of the second Trump administration, which by then had already announced a number of federal cuts. The committee met in Alexandria in April and is slated to travel to Hampton Roads and back to central Virginia, though the dates of those meetings were not readily available.
The committee’s charge was four-fold when it set out. Their goal was to:
- Collect and analyze data on the potential scope of workforce and funding cuts;
- Assess the likely economic and budgetary impacts on Virginia;
- Meet with stakeholders, including state agencies, businesses and nonprofits, to understand their concerns and gather mitigation strategies; and
- Provide policy recommendations to the General Assembly to address the challenges posed by federal reductions.
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Correction 9:20 a.m. May 13: Rita McClenny is president and CEO of the Virginia Tourism Corporation. Her title was incorrect in an earlier version of this story.
