The American Rescue Plan will provide $7.2 billion for Virginia: $2.9 billion allocated for municipalities, and $4.3 billion for the state government, according to a Tuesday announcement from Senators Mark Warner and Tim Kaine. On Wednesday, Governor Ralph Northam and Democratic General Assembly leaders released their priorities for the $4.3 billion, including upgrading public health infrastructure, funding the Rebuild Virginia small business recovery plan, adding funds to the Unemployment Trust Fund, modernizing public schools, and deploying broadband across Virginia.
“This is a unique opportunity to invest in Virginia’s long-term future. We intend to be good stewards of these taxpayer dollars, in full compliance with fiduciary guidelines. We reject calls to refuse these federal dollars, and we support the law’s prohibition on cutting state taxes to substitute federal dollars. We embrace this rare opportunity, and we choose to invest,” Northam and the legislators wrote.
Virginia’s General Fund is performing well, according to a separate Wednesday announcement from the Governor.
“Virginia is unique: This package comes at a time when state revenues are rising, more people are working, and unemployment is declining. Few states can say this, but it is no accident. This is the result of careful stewardship,” Northam and the legislators said in their statement. “Virginia has two options: Invest these dollars in Virginia’s future, or reject them and let Congress use our dollars for some other federal purpose. We choose the future.”
Another 2021 special session will be necessary to allow the General Assembly to allocate the funds. That session will likely be held at the end of July or beginning of August, and will only last a few days, according to comments Senate Majority Leader Dick Saslaw (D-Fairfax) made Wednesday. Saslaw met with Senate Minority Leader Thomas Norment (R-James City) in a Zoom call hosted by the Wason Center.
“I’ve encouraged the Governor’s people and particularly Aubrey [Virginia Secretary of Finance Aubrey Layne] and I’ve talked to Luke Torian [House Appropriations Chair Luke Torian (D-Prince William], and I’ve talked to Janet Howell [Senate Appropriations and Finance Chair Janet Howell (D-Fairfax)] to get together the senior people of both parties on the money committees in advance of the session, and try to see if they can’t come to an agreement on what it should look like,” Saslaw said.
“There might be a little fine tuning, but we cannot have what we had for 89 days last year. We need to get in and get out,” he said.
In 2020, Northam allocated most of Virginia’s CARES Act funds using his emergency powers, expenditures that were later confirmed in the General Assembly’s 2020 special session. Norment said it would be different this time.
“Initially, the Governor and the administration wanted the ability to determine how those funds would be appropriated and spent,” Norment said. “The Senate, with some conversation with the House, effectively said, ‘No. The General Assembly has got to participate in that discussion on how we’ll spend those funds.'”
Norment said, “I don’t care if it had been a Republican governor. We ought not be giving any governor, Republican or Democrat, the unilateral authority to determine how $3 billion plus in federal dollars should be spent.”
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