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Virginia Senate budget omits Metro funding, arena deal

Metro trains are seen on a track.
Tyrone Turner
Metro trains at the Metro train rail yard near West Falls Church station in Virginia.

Read the original article on the DCist/WAMU website.

Two major Northern Virginia line items are conspicuously absent from the Virginia Senate budget proposal released Sunday evening: funding for Metro and language creating the state sports authority that would oversee the proposed Potomac Yard arena.

The Virginia House Appropriations Committee, in contrast, included both items in its proposal, also released Sunday. The competing plans are the starting points in budget negotiations between the House and Senate — negotiations which may also take into account Gov. Glenn Youngkin’s original proposal. (The version from Youngkin, a Republican, did not include additional Metro funding, either.)

While the omission of the arena from the Senate version isn’t a surprise — Senate Finance Committee Chair Louise Lucas (D–Portsmouth) has made no secret of her opposition to the plan to build an arena in Alexandria for the Washington Wizards and Capitals, what she calls the “Glenn Dome” — the committee’s decision to leave out the roughly $150 million to keep Metro afloat was a setback for officials in Northern Virginia and the local delegation in Richmond.

Senate Majority Leader Scott Surovell (D–Fairfax), who serves on the Senate Finance committee, said he believed the Metro setback was temporary.

“It’s a negotiation,” he said. “There are 12 Democratic members [in the Senate] who are from Northern Virginia, and every one of us is fighting hard to get Metro in the discussion and fully funded.”

“I’m pretty optimistic we’ll prevail,” he said. “But there’s going to be some compromise on both sides to both House and Senate priorities, and it’ll wash out in that process.”

Surovell is less optimistic about the arena legislation, which he is carrying in the Senate.

“It’s on life support,” he said. “I’m not sure we’re ready to call in hospice yet.”

Lawmakers are exploring options to address Lucas’ most pressing concern about the deal, he said: having Virginia taxpayers act as a backstop on the project bonds, if the arena’s financial promise doesn’t materialize. There’s also talk of the arena being a key point of leverage for Democrats seeking Youngkin’s buy-in on other major legislative priorities, like setting up a state-regulated cannabis marketplace.

For her part, Lucas leaned into her criticism of the arena on Monday.

“For decades cities and states have competed for stadium deals that were terrible for taxpayers. So I have a challenge for@MayorBowser– let’s compete by both offering $0 in taxpayer dollars to these teams and let them decide where they want to pay to build their own arena,” she wrote on X, calling out D.C. Mayor Muriel Bowser, who has proposed a $500-million contribution from D.C. to keep the Wizards and Capitals at Capital One Arena.

The Virginia House of Delegates budget includes the language creating the state sports authority that would issue more than $1 billion in publicly-backed bonds for the arena’s construction and would ultimately own the completed arena. The language conforms with an amended version of the standalone arena bill, which gives the legislature more sway over the authority and requires the legislature to approve the project a second time next year. The Virginia House passed that amended bill last week, though without the support of many of the lawmakers representing areas closest to the site.

The House budget also includes extra funding for Metro: about $150 million over the next two years. Virginia counties and cities served by Metro typically pay more than half of the regular bill for the service themselves, and would also be expected to chip in a similar proportion to help avert Metro’s fiscal cliff.

The Senate Finance committee stopped short of that extra funding. It recommended lifting the 3% cap on increases in Virginia subsidies to Metro and pushed for “continuing the conversations around the financing of the Washington Metropolitan Transportation Authority in accordance with post-pandemic commuting patterns,” a nod to concerns about Metro’s lagging rail ridership in the era of hybrid work. (Bus ridership, Surovell noted, has surpassed pre-COVID-19 levels, and provides crucial connections around the region, particularly for lower-income passengers.)

“I feel like Metro has not done a good job of managing their resources. They need to get their act together,” Lucas said after the committee presentation, according to The Washington Post. During the meeting, she identified her primary priority as toll relief for drivers in the Hampton Roads area, which she has represented for over three decades.

Lucas joined Youngkin in expressing public criticism about Metro management, in a rare moment of agreement with the Republican governor she often roasts on X. The governor’s skepticism on Metro appeared to have softened as he’s sought to press forward on the Potomac Yard arena deal — and following a letter from Metro General Manager Randy Clarke detailing the belt-tightening measures WMATA is putting in place.

Youngkin’s arena proposal would rely heavily on a functional Metro system to bring sports fans and concertgoers to Alexandria, and the two priorities have been increasingly linked in Richmond as a result, with Northern Virginia Democrats saying that Metro funding is a precondition for them to consider Youngkin’s arena proposal.

Surovell has said he agreed to put the arena legislation forward on Youngkin’s behalf only after the two discussed the importance of funding Metro.

But in his conversations with Lucas, he said, the arena and Metro have not been tied together. Instead, those discussions have focused on Lucas’ concerns about Metro periodically returning to the state to request an increase in funding. Transportation policy makers said that’s due to the lack of a dedicated funding source that keeps pace with inflation. In the absence of that, Metro has to ask for additional money above the 3% subsidy increase legally allowed in Maryland and Virginia.

“Metro needs a dedicated guaranteed revenue source, so that it doesn’t have to come, hat-in-hand, every five years trying to figure out how to renegotiate its revenue picture,” said Surovell.

He hopes to emerge from budget negotiations with a commitment to support Metro akin to what’s in the current House version — about $150 million over two years, he said. He is also pulling for language directing Virginia to work with Maryland and D.C. to come up with “a long-term funding solution for Metro,” which he speculated could be some kind of sales tax or hotel tax.

Maryland and D.C. have already committed to paying their share to prevent Metro service cuts. If Metro advocates fail to win support in Virginia budget negotiations, that could leave Northern Virginia localities to shoulder the responsibility themselves.

“We’re ready to do our part. But we also need the partnership of the state,” said Matt de Ferranti, a member of the Arlington County Board and the chairperson of the Northern Virginia Transportation Commission, the regional organization that oversees Virginia’s Metro contributions.

De Ferranti recognized concerns about Metro’s management of its finances, but said the system is “in significantly better shape” than it was a few years ago, a fact he attributed to good stewardship from General Manager Clarke and Metro leaders.

The Northern Virginia Transportation Commission estimated Metrorail and the region’s bus network together provide $1.5 billion in direct and induced tax revenue, about 5% of the state’s general fund.

Margaret Barthel is the Northern Virginia reporter at WAMU.
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