After months under a cloud of fiscal austerity, Virginia’s revenue forecasts have brightened, providing enough cash for lawmakers to propose making repairs to school buildings, putting money away for a rainy day, and making good on their promise to boost state workers’ wages.
State employees and state-supported local employees would receive a 3 percent raise, college faculty would receive a 2 percent pay increase, and teachers would be in line for a 1.5 percent bump in annual pay under budget amendments the Senate Finance Committee proposed Sunday.
Senate amendments also set aside $5.8 million to address salary compression in the ranks of the Virginia State Police. It would help long-serving employees whose pay hasn’t kept pace with that of more recently hired workers.
The Senate proposes $8.6 million to raise salaries an additional 2 percent in 19 categories of state employment where turnover is high.
The House of Delegates and the Senate are proposing changes to the existing two-year budget for July 1, 2014, through June 30, 2016.
The Senate’s wage offerings, along with similar proposals House budget writers detailed Sunday, underscore the election-year desire of lawmakers in both chambers to address the lagging pay standard for more than 100,000 public employees.
The salary proposals are contingent upon forecasts being realized, but an improving revenue outlook has given lawmakers more than $400 million in additional funds with which to amend the budget.
“Unfortunately, the adjustment is not sufficient to undo all of the budget cuts that we made last year,” said Sen. Charles J. Colgan, D-Prince William, who is co-chairman of the Finance Committee with Sen. Walter A. Stosch, R-Henrico.
“So, we are strategically targeting the use of the funds largely for compensation, for all employee groups,” he added.
Said Stosch: “We thought it appropriate to restate our commitment to the dedicated women and men who teach our children, staff our jails, and protect our highways.”
The emphasis on compensation also figures prominently in the House budget amendments. They include a 1.5 percent raise for state police and state employees, with salary compression compensation for all employees, based on years of service, that could bump up annual pay up for some employees by more than 3 percent. The House proposes $4 million to roll back cuts to state police overtime.
House budget writers also allowed for a 2 percent raise for state-supported local employees, college faculty and classified employees, and, like the Senate, promised to provide the state share of a 1.5 percent raise for teachers, which would require a match from local governments.
The Senate and House plans devote roughly $100 million to finance building renovation and repairs at the state’s public colleges and universities. The Senate also borrows roughly $30 million to finance additional projects.
And both plans use the extra revenue projections to make deposits in the state’s so-called rainy day fund. The House contributes $103 million, while the Senate proposes $130 million.
“It was imperative that we not initiate new programs, but instead focus on addressing previous commitments and priorities,” said S. Chris Jones, R-Suffolk, chairman of House Appropriations.
State law requires Virginia’s budget to be balanced. The House and Senate will now begin the process of negotiation and compromise on spending priorities they will submit to Gov. Terry McAuliffe by the end of the legislative session on Feb. 28.
In a briefing for reporters over the weekend, Jones said he believes the House and Senate proposals are close on the big issues of compensation, the rainy day fund, capital spending and revenue projections.
Lawmakers will spend the next three weeks reconciling differences in spending priorities on health care, education, public safety and economic development.
“I am encouraged to see both chambers agree with my priorities, including funding care for the seriously mentally ill, avoiding cuts to K-12 and further cuts in higher education, funding the first lady’s school breakfast initiative and using increased revenues to offer state employees and teachers a much-needed raise,” McAuliffe said
The House and Senate eliminated the governor’s proposed fee increases on restaurant inspections and weights and measures.
Like the House, the Senate proposes a substantial increase in funding for the Governor’s Opportunity Fund, used to lure businesses, albeit roughly $10 million less than McAuliffe requested over the two-year budget.
Both chambers’ plans endorse a McAuliffe priority to appropriate roughly $4 million to allow Jefferson Laboratory in Newport News to compete for a Department of Energy project to build an ion collider. Officials say the collider could bring $1 billion in economic development to the Hampton Roads region.
The Republican-controlled Senate and House do not include budget language McAuliffe offered to provide for expansion of Medicaid.
In addition to a number of health proposals, the Senate plan effectively finances McAuliffe’s “Healthy Virginia” initiative to expand existing Medicaid and federal benefits coverage by maximizing usage by those who already qualify. The Senate appropriates an additional $102 million in total funding for behavioral health.
The House sets aside $124.5 million for its version of McAuliffe’s safety net program, including funding for “targeted” services and a prescription drug benefit to 29,000 seriously mentally ill patients.
The House budget plan also sets aside $5 million in research and development funds, including $1 million each to VCU Medical Center and U.Va. Medical Center for cancer research and $1.25 million to Virginia Tech for brain injury research and $1 million to Old Dominion University for biomedical research.
Both chambers spare K-12 education from cuts. Both fund first lady Dorothy McAuliffe’s school breakfast initiative, but the House limits the program to a local option available at elementary schools.
In higher education, the Senate provides an additional $5.4 million in need-based, undergraduate financial aid. The House has proposed $20 million to boost student enrollment and a per-student incentive to encourage schools with low graduation rates to accept transfer students.
Both Senate and House plans take steps to reduce the burden on localities. The House plans to spend roughly $40 million of $60 million in additional K-12 spending to fund teacher retirements. The Senate proposes to contribute an additional $37.2 million to teacher retirements and has proposed eliminating the $30 million it expects localities to contribute in the second year of the budget.
However, neither budget proposal includes the governor’s recommendation that localities be reimbursed $1.6 million for previously purchased voting equipment and be given $28 million over the next three years to purchase new equipment that conforms to state guidelines.