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Northam Proposal Avoids Layoffs Despite $2.7B Budget Hole

Northam at podium alongside Pharell Williams and Lamont Bagby
Gov. Northam speaks at a press conference in June. (Crixell Matthews/VPM News)

Virginia will avoid layoffs or cuts to core state services under Gov. Ralph Northam’s revised budget proposal.

But a variety of new investments in teacher pay raises, community colleges, and Medicaid approved by the General Assembly in March will likely disappear in the face of a nearly $3 billion dip in revenues over the next two years.

Northam will formally announce the new forecast and present his full revised budget on Tuesday ahead of a special session of the General Assembly. 

“Careful planning has kept us from having to gut critical services or lay off state workers, like other states have done,” Northam said in a statement on Friday. “I look forward to working with my colleagues in the General Assembly to advance long overdue police reform and pass record investments in affordable housing and broadband, so we can continue to support Virginians during this unprecedented time.”

His budget is built on a new state forecast that shows a $2.7 billion revenue shortfall compared to an earlier, pre-pandemic estimate in December.

Democrats used the latter numbers when they approved a 2-year state budget with some $2.2 billion in new spending. 

They froze that plan in a special session in April because of the pandemic.

Northam’s proposed budget does include several pieces of new spending, particularly on housing. The governor is calling for an $85 million investment in the Virginia Housing Trust Fund and another $3.3 million to set up an eviction diversion pilot program.

As students return to a virtual classroom, Northam is also asking for a record $85 million investment to expand access to broadband for underserved communities.

Ben Paviour covers courts and criminal justice for VPM News with a focus on accountability.
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