RICHMOND, Va. (WRIC) – The top Republican budget negotiator says he’s aiming to meet with his Democratic counterparts next week as the two sides look to reach a compromise on changes to Virginia’s two-year spending plan, including a proposal for $1 billion in tax cuts.
Virginia lawmakers approved a stop-gap budget bill in February to fund certain programs, giving leaders of the legislature’s money committees more time to iron out specifics, including Gov. Glenn Youngkin’s proposal for $1 billion in new tax cuts that split Democrats and Republicans.
Budget negotiators said they have been “in a holding pattern” as they monitor Virginia’s economic forecast amid concerns about a delayed recession.
They have stressed, however, that they are not in a rush to agree on a deal for the upcoming fiscal year because Virginia is in the middle of a two-year budget and there’s no threat of a government shutdown.
But with a more than $3 billion surplus unspent, the budget impasse has led to concerns for school districts and key programs that rely on state funds and need to finalize their budgets.
Del. Barry Knight (R-Virginia Beach), the chairman of Virginia’s House Appropriations Committee, said he’s looking to meet with Democratic negotiators in the state Senate soon as the sides continue to pursue an agreement.
“I am hoping the House conferees meet next week with the Senate conferees,” Del. Knight told 8News on Wednesday. “Then if we get a compromise a special session shortly thereafter.”
Knight did not delve into specifics about the negotiations but did say Richmond’s efforts for another casino ballot referendum and budget language to potentially block the city from holding a second vote would “be a topic to be discussed.”
Once a deal is reached, Gov. Youngkin (R) can call a special session for lawmakers to return to Richmond and vote on the budget revisions. In early June, Youngkin told 8News that he needs a budget. A Youngkin spokeswoman did not immediately respond to a request for comment.
House Republicans have backed Youngkin’s proposals to cut the corporate income tax rate from 6% to 5% — a move his administration said would help entice companies to Virginia — and reduce the top income tax rate from 5.75% to 5.5%.
Senate Democrats haven’t dismissed all of the proposed tax cuts but have been clear about their opposition to the corporate tax cut. They believe the $3.6 billion surplus Youngkin has touted as a way to pay for both tax cuts and make investments in education and mental health should fund other initiatives.
In late April, Knight told 8News that nothing was off the table in the budget talks after state Sen. George L. Barker (D-Fairfax), co-chair of the Senate Finance Committee, said that Youngkin’s pursuit of a 1% corporate tax rate cut was “clearly off the table.”
“I know what I want, and they know what they want, but we’re not going to get everything we want because there’s not enough money,” Knight said in April.
Sen. Norment told the Virginia Mercury after Secretary of Finance Stephen E. Cummings voiced optimism about Virginia’s economic future on June 13 that he believes the budget talks were held up because “some of the leaders have been distracted” by the primaries.
With the primaries wrapped up, those concerns may have faded. The two Democratic budget negotiators, Sen. Barker and state Sen. Janet D. Howell (D-Fairfax), co-chair of the Senate Finance and Appropriations Committee, won’t be in the legislature next year.
Barker lost against his primary challenger on Tuesday, according to the Associated Press, and Sen. Howell opted not to run for re-election. The offices of Barker and Howell did not immediately respond to a request for comment.