Opinion: Commentary: Virginia's Economy and Amending Northam's Budget

Opinion: Commentary: Virginia's Economy and Amending Northam's Budget

The General Assembly of Virginia already is in its second week. We gavelled in last Wednesday with the Governor’s State of the Commonwealth address to an almost empty chamber focusing on the economy and Gov. Northam’s introduced budget. The chamber was empty, but the General Assembly was there “virtually,” as are our online meetings every day with back-to-back committee two-hour meeting blocks from 7am to 4pm, when we then go to the “floor”— which is necessary in this new pandemic-restricted, safer online environment. Then, at the beginning of this week, my colleagues and I on the Appropriations Committee listened to over fifty presentations by House members regarding their amendments to Northam’s budget. Next week, we will start to decide which amendments are meritorious and can be funded.

The Governor has put forth an ambitious budget that invests money in critical programs to fight the pandemic, reform the criminal justice system, and support programs to improve the lives of Virginians. Further details about the budget proposals can be found at https://www.governor.virginia.gov/media/governorvirginiagov/governor-of-virginia/pdf/Highlights-of-Governor-Northam-2021-Budget.pdf.

The Governor has proposed additional funding to continue the COVID-19 response in Virginia, adding $240 million dollars to the pandemic response budget, with $90 million of those funds targeted at getting the vaccine deployed as fast as possible. He invests $500 million dollars in public schools across the Commonwealth to prevent reductions in funding due to lost tax revenue. The education proposals also include a 2 percent bonus for teachers and instructional staff members, as well as additional funds for counselors and increased access to early childhood education. There is $70.7 million proposed in additional funding for the Virginia Housing Trust Fund and the Rent and Mortgage Relief program, as well as $1.5 million for more housing attorneys under the Virginia State Bar. To ensure that all Virginians have access to broadband, the Governor has proposed adding an additional $15 million to the Virginia Telecommunications Initiative.

Governor Northam proposed additional funding for higher education and workforce development to get more Virginians back to work and into higher-paying jobs. The proposed budget includes $36 million dollars to the G3 program so Virginians can attend community college for training in high demand fields, and restores $30 million in tuition assistance for several Virginian public universities.

There is a $25.5 million proposed investment in environmental safety and agricultural best management practices, $23 million dollars to enroll more Virginians in the healthcare exchange, and $2.3 million to fund doula services to expectant mothers on Medicaid.

I would like to highlight a few of my own budget amendments. You can view all of my proposed amendments to the Governor’s budget here: https://budget.lis.virginia.gov/amendments/2021/1/HB1800/Introduced/MR/

Along with Sen. Adam Ebbin, I have proposed $2 million from the general fund to assist the Northern Virginia Regional Park Authority in the purchase and conservation of River Farm. Our hope is that this support will help to leverage additional funding and historic River Farm will be protected from future development for generations to come.

I have a budget proposal to create a Manufactured (Mobile) Home Parks Registry. The Department of Housing and Community Development shall collect a registration and registration fee, which shall not exceed $100, from each owner of a manufactured home park in the Commonwealth of Virginia no later than December 31, 2021, and every 24 months thereafter. The fees collected will maintain a database of the owners of Manufactured Home Parks, and make the database available to the public free of charge. My bill HB 334 last year required prior notice to residents in advance of the sale of their parks and $3000 in moving expenses from the seller. Creating a mobile home park registry would be an invaluable tool for nonprofit affordable housing providers who are interested in helping residents of these parks, and is the next step to helping mobile home park residents improve their quality of life and the stability of their communities.

I have a request for $287,651 for the Department for Aging and Rehabilitative Services to support the establishment of satellite offices of Centers for Independent Living (CILs) to serve people with disabilities in currently underserved geographical areas. These centers provide needed services and support to ensure that Virginians with disabilities can live independently in their own homes rather than facing unnecessary and more costly institutionalization.

My largest budget proposal, and one very significant to our area, provides $45 million from the general fund in fiscal year 2022 to assist in funding the undergrounding of utilities in Fairfax County to facilitate the creation of transit-oriented development, especially on Richmond Highway. This redevelopment will result in substantial additional state income, sales, and other revenues.

THE GOOD NEWS is that Virginia’s economic outlook is trending above the revised budget from the special session. Secretary of Finance Aubrey Layne surmises that this is due to three reasons: large companies have survived better than small businesses, the jobs created during the pandemic were higher paying than the jobs lost, and consumer spending has not declined—rather it has changed from a focus on services to goods purchased online. Unemployment in December was still double what it was last December (<5% vs 2.5%), but lower than the peak of the pandemic, and much lower than in many parts of the country. The housing market took off early in the pandemic with many people working from home, but it has slowed in the last months of 2020 and may have since peaked. Many sources of tax revenue were larger than expected after the revised budget that came from the special session back in the summer. Secretary Layne said that many revenue sources actually increased in 2020, such as recordation, corporate tax collection, and sales tax collection.

Of course, not everything is entirely rosy, despite the better than expected tax revenue. Many of our fellow community members have lost jobs, homes, and loved ones due to COVID. Budget-wise, the upcoming tax season is likely to be complicated due to the stimulus checks, state and federal grant and loan programs, and the number of people filing their taxes early.

More federal funding is needed to fund critical pandemic programs such as the Rebuild Virginia Grant Fund and the Rent and Mortgage Relief Program. The Governor has extended deadlines on several of these programs, but additional federal funding would allow expansion of such programs to assist even more Virginians.