Today, Ashley Kenneth, President and CEO of The Commonwealth Institute for Fiscal Analysis (TCI), released the following statement on the budget amendments proposed by Governor Glenn Youngkin:
“Today’s budget announcement is the start of building a budget that creates opportunities for all people in Virginia, no matter where they live or what they look like.
“Unfortunately, the governor misses opportunities to invest in long-term improvements. Throughout the upcoming session, TCI will champion real solutions that make Virginia a desirable place to live and where everyone can thrive: building strong public schools, increasing access to health care, making housing more affordable, and more.
On Tax Policy
“Virginia’s tax code can be a powerful tool to advance racial and economic justice and invest in the building blocks of our communities. Yet the governor missed several opportunities in his tax proposals to reach these goals.
- The governor fails to raise new sustainable revenue sources, pushing off onto lawmakers the responsibility to find new revenues to meet the needs of Virginia’s schools and communities. For example, a Fair Share Tax would have raised over $1.3 billion in the current budget (fiscal year 2026) by ensuring people who make more than $1 million each year pay more of their fair share. That is money that could have been used to make transformative investments in public education, health care, and more.
- The governor proposes to continue the increased standard deduction indefinitely, which often leaves out families with low incomes, but neglects to do the same for Virginia’s refundable Earned Income Tax Credit (EITC), a proven solution to boost the incomes of families with low incomes. This would effectively raise taxes on families who are struggling the most. For example, letting the refundable EITC expire would mean a family of four making $30,000 would see a tax increase of $547.21.
- The governor also ignores another proven and effective tax choice that would be critical to the well-being of many children across the commonwealth. Creating a Commonwealth Kids Credit (a state-level Child Tax Credit) would have built off the momentum of the 2021 enhanced federal credit, which helped cut child poverty nearly in half nationally and helped families better afford housing and put food on the table.
On Public Education
“The governor makes no progress on implementing the important near-term recommendations to improve Virginia’s public schools from JLARC, the legislature’s independent research agency. Instead, he proposes just $122.5 million in new non-technical adjustments for Virginia’s regular public schools, almost all of which is one-time funding for services administered by the Virginia Department of Education. Over half, $66 million, is for a new contract with a private company for new assessments. Meanwhile, the governor proposes making $63.3 million in dollar-for-dollar reductions in General Fund support for schools based on increased lottery profits, rather than using that money to improve Virginia’s schools — an issue TCI has long been advocating for.
“Instead of improving Virginia’s public schools, the governor proposes using $50 million in public funds for private school vouchers despite that “the last decade of research on traditional vouchers strongly suggests they actually lower academic achievement.”
On Health Care
“While Gov. Youngkin proposes to fund anticipated Medicaid/CHIP costs, he does not make progress on needed investments to expand access to health coverage for children who are currently barred from enrolling in Medicaid/CHIP or other initiatives to expand or maintain health coverage for children such as through a continuous eligibility waiver. The governor also missed an opportunity to protect the health coverage of over 600,000 adults enrolled through Medicaid expansion should federal funding be reduced. By making adjustments to Medicaid expansion budget language, Virginia lawmakers can support the ability for people across Virginia to access critical health services that allow them to go to work, study, or serve as caretakers for loved ones.
“TCI will work with our coalition partners to fight for a budget that makes meaningful investments in families. During the upcoming 2025 legislative session, we will continue to highlight the need to raise new, sustainable revenues and for everyone to pitch in their fair share. Together, we can make sure that Virginia’s budget is a true reflection of what and who we value as a commonwealth so that everyone has the resources to thrive, no exceptions.”
