Virginia Leaders Announce Comprehensive Budget Deal
~Bipartisan Agreement Targets $2.4 Billion Budget Shortfall While Protecting K-12 in FY’15~
Richmond, Virginia – Today, Governor Terry McAuliffe, Speaker Bill Howell, House Appropriations Committee Chairman Chris Jones, Senate Finance Co-Chairman Chuck Colgan and leaders from the General Assembly money committees announced they had reached a bipartisan agreement on how to tackle Virginia’s budget shortfall. The agreement will close $346 million this fiscal year and will address the $536 million gap for Fiscal Year (FY) 16.
“Virginia stands at an economic crossroads and the decisions we make today will affect the Commonwealth for years to come,” said Governor Terry McAuliffe. “I am pleased we were able to come together in a bipartisan way and make the tough decisions that will help ensure Virginia remains fiscally strong and provide much-needed certainty to the bond rating agencies on Wall Street. While the budget shortfall is forcing us to tighten our belts, I am proud that we were able to protect many of our core democratic priorities, including health care and K-12 funding for this fiscal year. The plan also prioritizes higher education by reducing the average budget reduction for public colleges and universities from an expected 5 percent to 3.3 percent for FY15. As we move forward, it is my hope that we can find other constructive ways to work together to build a new Virginia economy.”
Speaker Bill Howell (R-Stafford)
“Addressing Virginia’s budget shortfall sooner rather than later is the fiscally responsible thing to do. By acting now, we can create certainty for Virginia’s economy, give state agencies and local governments flexibility, and most importantly send a strong signal to the bond rating agencies that Virginia is serious about protecting its AAA -bond rating. We have once again proven just how big a difference 90 miles can make. While Washington continues to kick the can down the road, Virginia is demonstrating that elected leaders can work together, make tough decisions, and find ways for government to live within its means.”
House Appropriations Chairman Chris Jones (R-Suffolk)
“As House Appropriations Committee Chairman, I have a fiduciary obligation to the people of the Commonwealth. I take pride in our responsible stewardship of taxpayer dollars, especially during tough economic times. The actions taken today, and the bipartisan manner in which we have taken them, speak clearly to Virginia’s reputation as one of the nation’s best-managed states.”
Senate Finance Co-Chairman Chuck Colgan (D-Prince William)
"This bipartisan agreement is a good first step toward dealing with our budget shortfall and working together on Governor McAuliffe's vision for a new Virginia economy. The Governor and both parties in the General Assembly came to the table to broker a responsible bipartisan compromise that will balance the budget and put core priorities like education and health care first."
The agreement will close the budget gap by:
- Appropriating transfers from the Revenue Stabilization Fund, estimated at $470 million in FY15 and $235 million in FY16;
- Establishing reduction adjustment targets for state agencies, higher education and local governments to address the shortfall, including:
- State agencies are slated for $92.4 million in FY15 and $100 million in FY16
- Higher education is set at $45 million per year during the biennium
- Aid to localities is included at $30 million a year for the biennium
- Setting the stage for $272 million in other actions in FY16 to be achieved through measures that the Governor will address when he introduces his budget amendments in December.
- Allowing flexibility in capturing savings from available unexpected balances so that important priority items, especially in the areas of health care and economic development, are kept in place.
President Pro tempore, Senate Finance Co-Chairman, Senator Walter Stosch (R-Henrico)
“A major responsibility of the legislature and Governor is to protect and improve on the financial integrity of the Commonwealth. I am pleased we were able to work as a team to bring our collective and creative solutions together to respond to the further expected revenue shortfall. Virginia’s financial standing with Wall Street and with our citizens will benefit from our proposed action to responsibly address this matter now.”
Senate Majority Leader Thomas K. Norment Jr, (R-James City)
“Virginia is once again serving as a model on how government should address fiscal challenges. Today’s announcement is the result of collaboration and cooperation between the Executive and Legislature, the House and the Senate, and Democrats and Republicans. The hard work of Chairmen Jones and Stosch, Governor McAuliffe, and Secretary Brown has resulted in the Commonwealth quickly taking the steps necessary to preserve its hard-won reputation as America’s best fiscally managed state.”
Senate Democratic Leader Senator Dick Saslaw (D–Fairfax)
"Virginians elect us to work together to solve problems, and this agreement is proof that we can still honor that responsibility. Cutting the budget is never easy, but Governor McAuliffe's leadership has resulted in a balanced process that prioritizes core services like education and health care."
Senate Republican Caucus Chairman Ryan T. McDougle (R-Hanover)
“When legislators act to approve this measure on Thursday, they will be voting for the sound fiscal management of the Commonwealth. When this challenge was identified over the course of the summer, Virginia acted urgently to ensure its budget would remain balanced, its taxpayers protected, and its AAA-bond rating preserved. That’s precisely what the people who have entrusted us to represent them expect of their leaders.”
House Majority Leader Kirk Cox (R-Colonial Heights)
“Today’s agreement proves once again that it is not impossible for elected leaders to work together in order to address fiscal challenges, despite Washington’s best attempts to prove otherwise. This agreement is about protecting the financial integrity of Virginia and preserving Virginia’s reputation for sound fiscal management. This agreement cuts spending, but protects core functions of government like K-12 education and provides local governments with the flexibility they need to address this shortfall. Most importantly, we are not raising taxes or fees. We are setting priorities and making tough decisions just like Virginia families and businesses have to do.”
House Democratic Leader David Toscano (D- Charlottesville)
"Governor McAuliffe promised to bring Republicans and Democrats together to build a new Virginia economy, and that begins with balancing our budget responsibly. We cannot grow an economy without investing in public education, health care and other core services, and this budget deal protects those priorities first. I applaud the Governor and the General Assembly leadership for coming together and getting this important agreement done."
Barry Duval, President & CEO Virginia Chamber of Commerce
"A bipartisan approach to balancing the budget is in the long term best interest of the Commonwealth. I commend the Governor and members of the General Assembly for protecting Virginia's reputation as the best managed state."
Brett A. Vassey, President and CEO, Virginia Manufacturers Association:
"VMA is encouraged that Governor McAuliffe and General Assembly leaders have been able to work together to balance priorities and the budget."
Chris Saxman, Executive Director, Virginia Foundation for Research and Economic Education (FREE)
"Thank you to Governor McAuliffe, Speaker Howell, Chairmen Jones, Colgan and (R Senator) for working together to balance Virginia's biennial budget. This bipartisan effort sends an important signal to the business community and the citizens of the Commonwealth that maintaining a strong fiscal position is essential for economic development and growth."