Gov. Robert F. McDonnell (R) announced Monday that Virginia posted its third straight budget surplus, ending the fiscal year last month with $130 million.
The surplus comes from an increase in revenues and transfers as well as savings in state government.
Total revenue collections rose by 5.4 percent, ahead of the forecast of 4.5 percent. This marks the second straight year that revenue growth has exceeded 5 percent. The boost is attributed to growth in individual income tax receipts from payroll withholding, lower individual income tax refunds and higher than expected sales and corporate income tax collections.
Revenues have now returned to the level reached in 2008 — an indication that Virginia is continuing to recover from the worst recession since the Great Depression.
“Virginia continues to demonstrate that conservative fiscal management, a focus on government efficiency, and bipartisan efforts to bolster our economic development and job creation programs can speed economic recovery in the Commonwealth,” McDonnell said.
“For too long, elected officials from both parties have overpromised and overspent, and the result is the fiscal crisis we see unfolding in Washington D.C.,” McDonnell said. “Here in Richmond, we are committed to a culture of fiscal responsibility and restraint in state government. We have made some very tough choices. We have reduced spending, not raised taxes and focused government on its core functions.”
The majority of the money must go to the rainy day fund ($78.6 million), cleaning up the Chesapeake Bay ($20.2 million), and roads ($12.3 million) as mandated by state law. Additional money could be spent on a state employee bonus.