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Youngkin signs Virginia budget with tax cuts, spending increases

Virginia Gov. Glenn Youngkin signs the budget at a ceremony at a grocery store June 21, 2022, in Richmond. (Steve Helber/AP)
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RICHMOND — Gov. Glenn Youngkin (R) invited several hundred supporters to a suburban Richmond grocery store Tuesday to watch him ceremonially sign the state’s two-year budget, touting its rare combination of $4 billion in tax cuts and increased spending for education and law enforcement.

“This is big,” Youngkin said to hoots and cheers beneath a campaign-style banner that read “Getting it done together.” “It’s not everything that I wanted, so we’re going to go back in and get the rest” next year, he said. “But it is a big step in the right direction.”

His action comes just 10 days before the June 30 deadline to get a budget in place for the next fiscal year — a relatively close call caused by protracted negotiations for a compromise between the Republican-controlled House of Delegates and the Democratic-controlled state Senate.

Youngkin scored a few wins in the budget deal, suffered some losses and ultimately decided to take what he could get — including an increase in the state’s standard income tax deduction and a reduction in the tax on groceries.

At the rally Tuesday — held at Tom Leonard’s Farmer’s Market, the same store where Youngkin filmed a political ad last fall about eliminating the grocery tax — the new governor blamed Democrats in the Senate for blocking his full agenda, which sought another $1 billion in tax cuts.

“Virginians deserved a better answer from our Senate Democrats than no,” he said. “This is a time for us to come together,” Youngkin added, invoking what he likes to describe as a “movement” that got him elected.

The movement “was not Republicans against Democrats, it was about Virginians standing up for all that we know is right,” he said.

Afterward, in a brief interview with The Washington Post, Youngkin said he intends to spend the rest of the year mounting similar rallies and “listening sessions” around the state in a kind of perpetual campaign mode — unusual for a Virginia governor. Asked if he’s running for some other office, Youngkin said he’s simply trying to keep people informed.

“It’s my job to make sure that Virginians know we’re working for them every single day. And so we’re going to communicate,” he said. A film crew from a political consultancy took video of Youngkin ringing up groceries as the rally ended. A spokesman from the governor’s office said he did not know whether the footage would wind up in another political ad.

Virginia General Assembly gives Youngkin mixed results on budget

With state coffers full from surging tax collections as well as federal coronavirus relief money, Youngkin and the General Assembly had plenty of resources to spread around in the budget. The centerpiece for Youngkin is a big increase in the standard deduction for personal income tax. He had sought to double the current level of $4,500 for individuals and $9,000 for couples filing jointly, and the General Assembly came just short of that, at $8,000 and $16,000, respectively.

Taxpayers will also get one-time rebates of $250 for individuals and $500 for couples — again, just shy of the $300 and $600 sought by Youngkin.

The new budget eliminates a 1.5 percent statewide tax on groceries but leaves intact a 1 percent local levy that Youngkin had wanted to cut. Lawmakers also refused Youngkin’s repeated request for a three-month holiday for the state’s 26-cent per gallon gasoline tax, arguing that there’s no guarantee wholesalers will pass the savings along to consumers and that the loss of revenue would harm transportation spending accounts.

One Republican — Sen. Emmett W. Hanger Jr. (Augusta) — joined all Senate Democrats in opposing the gas tax suspension.

The two-year plan includes a total of more than $19 billion for public education, an all-time high. Teachers and state employees are slated to get 5 percent raises for each of the next two years, as well as a one-time $1,000 bonus.

Youngkin won approval for $100 million for his plan to start “lab schools” around the state, partnering institutions of higher learning with K-12 schools. Current law allows only public colleges and universities with teacher training programs to participate in such programs; legislation to let private institutions participate failed to make it out of committee in this year’s regular General Assembly session.

In a budget session last week, though, the General Assembly passed a Youngkin budget amendment that would allow private colleges and universities to participate, as well as community colleges. But Democrats in the Senate killed a companion amendment that would have transferred more money to the program from public school spending.

Youngkin resurrects gas tax cut but not Commanders stadium in budget proposals

Democrats in the Senate blocked several other attempts by Youngkin to legislate through the budget, including a proposal that would have prevented the state from using public money to fund abortions for low-income women in cases where the fetus has “incapacitating” physical deformities or mental deficiencies.

Youngkin’s own party blocked another proposed amendment, with Republicans in the House of Delegates opting not to vote on a measure to make it a felony to demonstrate outside the home of a judge for the purpose of intimidation. GOP leaders said they support the idea but want to spend more time crafting a law.

The new budget goes into effect July 1.