What a difference a year makes. A year ago, the Virginia economy was struggling and the House/Senate were in a stalemate on the issue of Medicaid expansion.
This year, the Governor signed the Assembly’s amendments to the budget without a single correction or change. This action was predicated on the reality that the R’s control both legislative bodies and there’s little chance that a material change to the budget (e.g. closing the coverage gap) would pass.
More notably, the budget did more and looked better because of a marginal, yet noticeable, upswing in the Virginia economy which added another $520M to our anticipated revenues, above the pessimistic 2014 projections.
Our 2015 budget now gives a 2% pay increase to state employees (long overdue), while setting aside additional funds for the Rainy Day Fund. It eliminates the “reversion clearing account,” which annually sweeps away residual funds from local governments. Finally, it prepays a portion of our VRS loan and spends $140M in one-time capital needs. The idea for the last piece is to spend at least a portion of the surplus, without creating a new baseline for annual spending.
There is a small number of additional “General Fund” items, which includes a targeted compensation increase for State Police and an extra General District Court judge for Fairfax County (which means that we’ll add three new GDC judges this year, along with two new Circuit Court judges).
All in all, it’s a pretty good budget. The fact that the Governor signed it without amendment will also significantly shorten our veto session on April 15, which is always appreciated.