Virginia saw a 66.2 percent General Fund revenue increase in May according to a Friday announcement from Governor Ralph Northam. He also announced the appointment of Joe Flores as the new Secretary of Finance, and a Return to Earn Grant program to help provide bonuses to new hires at small businesses.
“Virginia’s economy is roaring back to life thanks to hard work following the science and one of the strongest pandemic responses in the country,” Northam said in a press release. “New COVID-19 cases are at record lows, our vaccination rates are among the nation’s highest, and Virginians are heading back to work—and these record revenue gains are the result.”
Northam’s press release had some caveats: May is normally a big month for revenue collections due to timing of certain tax deadlines. Last year, the filing deadline was extended from May 1 to June 1, and this year, the deadline was moved to May 17. As a result, to correctly assess growth, full data from the April through June quarter is needed. Still, Northam’s release says the growth is the largest monthly increase in over 50 years.
Flores served as the Deputy Secretary of Finance since 2018. He’s replacing Aubrey Layne, who is leaving to work as Chief of Staff at Sentara Healthcare starting in July, according to a May 26 announcement from Sentara.
Return to Earn Grant Program
The program matches payments from eligible small businesses to provide new hires with up to $1,000. It’s a match, so small businesses pay up to $500 and the program will provide matching funds.
“Many Virginians who lost their jobs as a result of the COVID-19 pandemic still face a variety of barriers to returning to work like access to affordable child care, transportation, and a living wage,” Northam said in a press release. “These bonuses will serve as an incentive for unemployed workers to get back into the workforce while also helping employers fill vacant jobs.”
“While many companies are offering hiring bonuses, the Return to Earn Grant Program will serve businesses with less than 100 employees that may not have the resources to provide this financial support,” the press release states.
The program is funded by $3 million from Virginia’s share of federal Workforce Innovation and Opportunity Act funds. Participating employers can opt to pay the bonuses directly or in installments to new full- or part-time employees hired after May 31, when job search requirements re-started for unemployment benefit recipients. To qualify, small businesses must pay $15 per hour and positions must qualify as W-2 employment.
Those requirements displeased Senate Republicans, who have called for back-to-work bonuses, to be paid for with American Recovery Plan Act (ARPA) funds, to incentivize Virginians to apply for jobs.
“[Northam’s] scheme, however, is clearly designed to adhere to a partisan agenda and not in the best interests of workers, employers, or the Commonwealth,” Senate Minority Leader Thomas Norment (R-James City) and Senator Stephen Newman (R-Bedford) said in a joint press release. “Requiring businesses to pay bonuses to participate, and mandating a higher wage rate if they do, will result in a limited number of businesses availing themselves of this program.”
The senators also criticized ongoing payment of the additional federal $300 unemployment benefit, and called for a special session to allocate ARPA funds.
They said, “While the administration has finally acknowledged the employment crisis with which Virginia’s businesses are having to grapple, they have once again done so by executive edict.”
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