My columns written over the couple of weeks after the ending of the annual General Assembly session this year as you may remember were filled with excitement and superlatives about the great work that had been accomplished this year. I even described the budget that was passed for the next two years as being the best on which I had voted over my legislative career. Many goals including to better fund education, mental health, homeless prevention, environment and other areas were not only met but were funded at historic levels.
Then suddenly, “poof,” the good news ended as the world sank into the COVID-19 crisis and the resulting economic collapse. Monies that had been projected to be received to support the very real needs of the Commonwealth as reflected in the budget we passed evaporated. The General Assembly is scheduled to meet on April 22 in a reconvened session to consider the Governor’s recommendations on legislation we passed including amendments that are needed to keep the budget in balance. Extra precautions are being taken for the meeting because of the coronavirus pandemic, but the meeting will be very painful for the decisions that must be made on the budget. There are no good choices.
Virginia has an all-time high in rainy-day reserve funds of about two billion dollars. Those funds are built up in the good times to serve as a cushion in challenging times like now. Ideally reserve funds would be drawn on over the duration of the recession rather than being fully exhausted at the beginning, but the unknown is the length of the economic recession. Virginia has historically taken a very conservative approach to dipping into its reserves and is likely to once again with the high level of uncertainty about the future of the economy. While federal funds are expected to be made available to the states, the amount and timeline for assistance may be even more unpredictable than the future strength of the economy.
The tendency in budgeting is often to make reductions in those items last added to the budget and to protect more established programs. Such an approach at this time would put in jeopardy an increase in the minimum wage that affects state employees as well as those in the private sector. We are way past time to increase the measly $7.25 minimum wage that we had approved to go to $9.50 in January. I agree with the argument of advocates who insist that increasing the minimum wage would help with economic recovery because that increase would go immediately back into the economy as it is spent on groceries, rent, transportation and other necessities. The same argument applies to salary increases for teachers and state employees. These workers with the lowest of incomes should not bear the brunt of the declining economy.
More difficult decisions face us in a budget that proposes increases to programs that help the homeless, increase funding for preschool education, expand programs for persons with special needs, and expand environmental protection among others. There are no good choices!