The Virginia General Assembly adopted a two-year spending plan today during a one day Special Session. Lawmakers in both chambers pledged to continue to look at ways to expand the tax base and provide additional funding for public education.
Highlights of the 2024-2026 biennial budget are:
- Retains all spending items from the Conference Report adopted by the General Assembly this past March. However, in a compromise with Governor Glenn Youngkin, lawmakers scrapped plans to expand the digital sales tax. This additional revenue ($169 million) would have provided increased funding for K-12 education.
- The Conference Report included $1.4 billion cash and $386 million debt for Capital Outlay projects.
- Conference Report committed $400 million from the Literary Fund - $150 million for teacher retirement in FY 2025 and $250 million for loans split over the biennium.
- HB 6001 moves the $150 million of Literary Funds from FY 2025 to FY 2026 but makes no changes to the overall amounts.
- HB 6001 (HB 30) and HB 6002 (HB 29) assume that the FY 2024 forecast is increased by $525 million
- This will increase the assumed carryforward into FY 2025.
- Any base adjustments can be picked up as part of the standard fall revenue forecasting process.
- Recognizes an additional $525 million in FY 2024 withholding revenues (no base adjustment).
- Holds School Divisions Harmless for state repeal of the grocery tax.
- Three percent state funding for SOQ position salary increase in each year of the biennium.
- Year-to-date revenue was $1.12 billion ahead of forecast. Of this total, $536 million comes from withholding tax revenues.
- Year-end revenue collections may well exceed the current forecast by more than $1.2 billion.
To view the entire budget bill, click here.
