The impact of the federal government’s decision to claw back hundreds of millions of dollars worth of COVID-related grants from Virginia is becoming more clear.
In March, President Donald Trump’s administration informed the Virginia Department of Health that it was terminating three existing contracts prior to their original end dates. The decision was effective March 25 — the same day the announcement was made.
The three impacted grants, which awarded roughly $870 million to the commonwealth, covered epidemiological research to prevent and control emerging infectious diseases; child vaccination and immunization programs; and addressing health disparities for at-risk and underserved communities.
The abrupt March cuts led the state’s health agency to layoff or pause contracts for 530 people, including 13-full time positions and 517 temporary positions. According to VDH, it hopes to rehire employees to fill other vacancies within the health department.
Former State Health Commissioner Dr. Norman Oliver, who led the agency during the pandemic, told VPM News shortly after the announcement that the grant’s suspension would make Virginians more susceptible to future pandemics and could lead to “horrific consequences.”
He explained the cuts would interrupt efforts to upgrade state data collections systems, increase the likelihood of infectious disease spread, and decrease efforts to address other public health concerns like the opioid epidemic and sexually transmitted diseases.
As VPM News previously reported, the state stood to lose up to $425 million following the federal cuts, based on available information from the General Assembly. VDH has since confirmed that the approximate unspent balances from the shuttered grants totals $219 million, although a spokesperson for the agency added that amount could still change as final expenses are closed out.
The grants were set to expire at various times between June 2025 and July 2026. An email from State Health Commissioner Dr. Karen Shelton in March, later obtained by VPM News, said the agency had been anticipating the changes and spent the past several months planning for reductions in federal spending.
An email sent to department leaders earlier that day from Chief Financial Officer John Ringer included a detailed series of same-day tasks such as pausing discretionary spending, compiling lists of potentially impacted staff and contractors and flagging critical work that will require new funding streams.
Multiple individuals with knowledge of the cuts, who weren’t authorized to speak on the record, told VPM News at the time that the cuts abruptly stopped several ongoing projects without notice.
“VDH leadership will determine whether and if alternative funding sources are available and appropriate for impacted services,” an agency spokesperson said in an email this week. “VDH remains focused on providing core essential public health functions across the Commonwealth and local Health Departments are still operating and open for services.”
