The Virginia House of Delegates passed a two-year budget Thursday
that includes no fee or tax increases, eliminates state liabilities, reduces borrowing, makes significant K-12 Education investments, holds college tuition increases down, invests in economic development while increasing accountability, provides funding to help combat domestic violence, and strengthens the healthcare safety net. The budget bill, HB30, passed the House 98 to 2.
In this Update, I highlight specific sections of the budget and thank constituent groups for visiting my Capital office.
The House takes a conservative and cautious approach to budgeting your tax dollars. It deposits $605 million in the state’s rainy day fund, restoring the fund to 90% of its previous high balance for use in any future economic downturn. By the end of the biennium, the fund will be at $845 million.
Our budget eliminates the Accelerated Sales Tax on over 90% of businesses by the end of FY 2018.
The budget reduces what Virginia will borrow over the next few years by over $508 million compared to Governor McAuliffe’s proposal.
In addition, we are accelerating the $189.5 million repayment to the VRS for the contribution rate deferral in 2010. This is six years ahead of schedule. The efforts to fully fund the Virginia Retirement System and fulfill the payments deferred in 2010 will keep Virginia on sound financial footing and protect our prestigious Triple-A bond rating.
I gave a floor speech
outlining our commitment to educating our children that is unwavering. The House budget sends 31% of lottery funds, or $272 million, back to local school divisions. This mechanism gives local schools more flexibility by not requiring matching funds and provides greater freedom on how the funds must be spent.
This is part of the House’s $897.7 million education package, which is larger than the budgets proposed by Governor McAuliffe and the Senate. The House budget also funds the state’s share of a two percent teacher pay raise in the second year of the budget.
The Elementary and Secondary Education Subcommittee report can be found here.
We also make significant investments in higher education in order to help make college more affordable for Virginia families. We have designated nearly $290 million in new funding for our public colleges and universities coupled with the expectation that those same institutions limit their in-state tuition increases for each of the next two years to no more than 3%.
Additionally, the House Appropriations Committee has focused on how to reform our nearly 40-year-old financial aid model. I’ve also addressed this in my HB568 that helps motivate students to successfully finish their degree on time by increasing aid money to students as they progress through their academic career. Our budget also includes language that requires the State Council of Higher Education to propose more reforms to our financial aid methodology.
Finally, our budget increases state support for community college students by $264 per year in FY17 and $317 per year in FY18.
The Higher Education Subcommittee report can be found here.
Healthcare Safety Net
We continue to hold the line against Obamacare’s Medicaid expansion. The House budget does not include Medicaid expansion. For years, we have argued that Virginia cannot afford to expand Medicaid and the experiences of other states prove that. Just this week, we learned that Kentucky’s Medicaid program faces a $611 million shortfall, largely due to Medicaid expansion.
Instead of expanding an expensive and inefficient program, the House budget invests $28.9 million in new funding to build a stronger healthcare safety net, including funding for substance abuse treatment, two new Programs of Assertive Community Treatment (PACT) teams that provide patient-driven, proactive, personalized, team-based care to patients with serious mental illnesses. We also expand eligibility for the GAP program, related to medical and behavioral health coverage, to 80% of the poverty level.
I’m particularly proud that our budget provides $104 million over the next two years in state funds to enhance our system of care for the intellectual and developmentally disabled. This is an issue I’ve worked on for many years. Our budget includes a total of 1,105 Medicaid waiver slots, 250 more than the U.S. Department of Justice Settlement Agreement requires.
This funding will also be used to redesign our three waiver programs to ensure the appropriate level of services are available to meet the varied needs of individuals leaving state training centers for the community and those already in the community who need services to avoid institutional care. It is our hope that by accessing the right types of services, eventually we will be able to serve more individuals who are on the critically long waiting lists.
Another key area of investment is in our state employees. We’ve included a 3% pay raise in the first year of the budget for state employees, college faculty, and state-supported local employees. The Governor’s budget proposal provided a pay raise in the second year. Our budget will fully fund the state’s annual contribution to the Virginia Retirement System, two years ahead of schedule.
Visitors to the Capitol
This week I welcomed several children involved in Chesterfield 4-H.
Chesterfield Dominion employee constituents visited the Capitol to discuss energy legislation.
John Tyler Community College students and President Ted Raspiller visited with me to share their academic experiences.