Virginia legislators closed out their 60-day regular session Saturday without approving the state's budget, teeing up a special session in the coming weeks to finish their work.
Budget negotiators remained at loggerheads over a package of planned tax cuts, namely, a proposed elimination of the state's grocery tax and an increase of the state's standard deduction on the individual income tax.
With budget negotiations stalled, lawmakers seized the opportunity for more time to continue negotiations on other contentious bills, including legislation to bring a new football stadium to Virginia and a bill backed by Gov. Glenn Youngkin to usher in public schools run by colleges and universities.
In a meeting with reporters after both chambers adjourned at 2:55 p.m., Youngkin said he was "pleased by the progress that's been made in the last couple of the days on the budget," and was hopeful both chambers would come to an agreement soon.
"We still have work to do. We need we need to get taxes down. And we need to make investments in some really important areas like education and law enforcement and behavioral health," Youngkin said.
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Neither Youngkin nor legislative leaders were willing to lay out a timeline for completing the remaining work. When negotiators agree on a budget, Youngkin is expected to call for a special session to take up the spending plan and any deals made on outstanding legislation.
House Appropriations Chair Barry Knight, R-Virginia Beach, painted an optimistic picture of budget negotiations, describing an amicable Friday night meeting between House and Senate counterparts.
"I think without the distractions that we have, we can get in a room and we can talk," he said. "We're very quickly gonna agree to agree, or we're gonna agree to disagree," Knight said.
"I believe that right now we have a budget that with a few small tweaks will pass the Senate and the House with bipartisan support."
Senate Finance Chair Janet Howell, D-Fairfax, declined to answer questions on the status of budget negotiations Saturday afternoon. In a statement, Howell said Senate negotiators would "work to maintain the original Senate budget funding to invest in the futures of Virginia’s students; provide health resources, particularly behavioral care, for everyone in the Commonwealth; and assure economic strength for every family."
House Speaker Todd Gilbert, R-Shenandoah, said the special session would be limited to the budget and about two dozen outstanding measures. He said Senate lawmakers drove the decision to break for a few days before continuing negotiations.
“We laid out the limitations of any future special session to the budget, and then the remaining conference reports that are in limbo today,” he said. “There's still some big things in that.”
As of Friday afternoon, the House budget included almost $5.5 billion in tax cuts and rebates, but the Senate continued to insist on deferring the centerpiece of the governor’s tax plan — the doubling of the standard deduction for income tax filers — until a joint subcommittee completes a comprehensive study of Virginia tax policy in the coming year. Doubling the standard deduction would reduce state revenues by $2 billion over two years.
The Senate has agreed to partial repeal of the 2.5% sales tax on groceries, but has balked at eliminating the 1% that goes directly to local governments and has approved a less generous tax exemption for military retirement income than the House.
It also has approved smaller tax rebates this year than the House and rejected a 12-month rollback in the gas tax as meaningless to soaring prices at the pump.
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Patrick Wilson contributed to this report.
General Assembly adjourns, but the state budget is still pending - Richmond Times-Dispatch
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