RICHMOND — The General Assembly adopted a pair of state budgets Thursday despite Senate Republicans’ concerns about the potential economic fallout in Virginia from a steep plunge in the stock market amid the global coronavirus pandemic.
The Senate voted 27-11 to approve new budgets for the current fiscal year that ends June 30 and the next two years, beginning July 1. The House of Delegates approved the current year budget by a 70-20 vote and the two-year budget 66-24.
The only drama came in the Senate, where Republican senators urged the assembly to wait a week or 10 days before voting on the budget to allow lawmakers to know more about the emergence of a bear market that Sen. Steve Newman, R-Bedford, estimated could cost the state $1.5 billion to $3 billion, primarily in the end of this year and beginning of the next.
“I don’t believe this virus has anything to do with Republicans or Democrats,” Newman said. “I believe it’s going to have an economic impact on our commonwealth.”
Newman and Senate Minority Leader Tommy Norment, R-James City, are both Senate members of the conference committee that negotiated a budget agreement with the House of Delegates on Saturday night, but they said the ground had shifted in the five days since that vote.
“I was very comfortable with it when I left on Sunday, but the world has changed just a little bit,” Norment said.
Sen. Janet Howell, D-Fairfax, in her first year as chairwoman of the Senate Finance and Appropriations Committee, strongly opposed the effort to delay adoption of the two budgets.
“I think we need to be steady and firm at this point,” Howell said, predicting a delay in adopting a state budget “will send out signals that I think will be very upsetting to the population of Virginia.”
Howell also assured the Senate the budget negotiators would meet to develop contingency measures. They plan to be able to make recommendations to Gov. Ralph Northam to respond to the economic effects of the stock market drop before the assembly returns on April 22 to consider the governor’s amendments to the budget and legislative vetoes.
The House passed both budgets without debate, but House Appropriations Chairman Luke Torian, D-Prince William, acknowledged after an earlier budget briefing that “all of us are taken back” by the stock market plunge in response to the World Health Organization’s declaration the spread of the coronavirus had become a global pandemic.
However, Torian and Howell emphasized the importance of Virginia’s financial reserve funds, which the new budget would increase by $182 million, on top of the $300 million Northam had included in his proposed budget and an additional $112 million from a mid-session revenue reforecast that must be deposited in the rainy day fund under the state constitution.
“That’s why we need to be putting money into reserve,” Torian said in an interview. “We never know what’s going to have an effect on our economy.”
With the budget adopted, the assembly adjourned the 65-day extended session.