RICHMOND, Va. (WRIC) — Virginia budget negotiators say they will meet Thursday to resume talks on revisions to the state’s two-year spending plan for the first time since negotiations broke down in late June.
Leaders of the Virginia General Assembly’s money committees are set to meet Thursday afternoon for the first time since the budget talks fell apart on June 27, Republican House Appropriations Committee Chairman Barry Knight and George L. Barker, co-chair of the Senate Finance and Appropriations Committee, told 8News on Wednesday.
Neither discussed the status of the impasse that stopped the budget talks, telling 8News they would know more after Thursday’s meeting.
The office of state Sen. Janet D. Howell (D-Fairfax), the other co-chair of the Senate Finance and Appropriations Committee, did not immediately respond to a request for comment.
Lawmakers approved a so-called “skinny” budget before wrapping up the 2023 legislative session with hopes of reaching a compromise on how to spend state funding in the fiscal year that started July 1.
But talks fell apart over Gov. Glenn Youngkin’s proposal for a new round of tax cuts days before the new fiscal year started, leaving key services in need of state funding, including local school districts, in limbo.
Del. Knight (R-Virginia Beach), the top House Republican budget negotiator, said after talks collapsed in June that he outlined a budget deal in February that his Democratic counterparts in the state Senate backed before pulling their support.
“We had a deal from my perspective,” Knight told 8News in an interview on June 28. “They walked it back.”
Knight said he got rid of Youngkin’s proposal to cut the corporate tax rate by 1% – a plan that state Sen. Barker (D-Fairfax) told 8News was “clearly off the table” in April.
According to Knight, the informal deal was a $900 million plan including tax cuts, one-time tax rebate checks, increasing the standard deduction for income taxes and updating Virginia’s income tax brackets along the lines of recommendations from the state’s legislative watchdog agency last October.
The Senate Democrats’ proposal, Knight said, included investments in public schools and the state’s behavioral health system, doubling the one-time rebate checks from $100 to $200 for individual filers and from $200 to $400 for joint filers.
Virginia Democrats criticized House Republicans’ proposal, with Senate Democratic Caucus Chair Mamie Locke (Hampton) claiming the GOP lawmakers “favor tax cuts for their wealthy donors over financial stability.”
Youngkin, who voiced disappointment with the stalemate, has been adamant that any budget deal can fund his proposal for $1 billion in tax cuts and investments in public education, behavioral health and more.
The governor reiterated that position Wednesday when announcing Virginia’s general fund revenues ended the 2023 fiscal year with $5.1 billion in excess resources.
“There is plenty of money in the system to fund our shared priorities of education, behavioral health and law enforcement while returning more of Virginians hard-earned dollars back to their wallets,” Youngkin said in a statement.
Youngkin could call a special session on the budget without a deal in place to force lawmakers to return to Richmond or wait until an agreement is reached. When asked about the possibility of a special session, Youngkin spokeswoman Macaulay Porter told 8News, “The governor is currently evaluating next steps.”