RICHMOND, Va. (WRIC)-With billions of dollars on the line, the General Assembly’s special session is off to a slow start.
When lawmakers left the floor on Monday, there was no sign of a budget deal and neither side of the aisle had seen a hard copy of Governor Glenn Youngkin’s emergency legislation to temporarily suspend the state’s gas tax.
Governor Youngkin ordered the legislature to reconvene less than a month after the regular session wrapped up because lawmakers failed to reach a compromise on the two-year spending plan.
At a bill signing on Monday, Youngkin said he called the special session without a deal because he was disappointed by the lack of progress.
“I was disappointed there wasn’t more work last week. Everybody is here today and I expect them to get to work today,” Youngkin said.
At least publicly, not much was accomplished.
In an interview on Monday morning, Delegate Barry Knight, chairman of the House Appropriations Committee, said budget conferees planned to meet privately in the afternoon. He anticipates a deal can be reached by the veto session scheduled for the end of April.
“We know that the localities have to get their budgets together,” Knight said. “So we’ve got that in the back of our mind. We do know that we didn’t get a budget passed one year until June the 23rd. So we’ve got some time to do it and get it right, which is first and foremost what we want to do.”
Knight said the biggest divide remains how far to go on tax cuts. For example, the budget proposal crafted by House Republicans aims to double the standard deduction for state income tax, cut the entire grocery tax and provide slightly larger one-time tax rebates.
“We’d rather give some relief to the taxpayers…So we’re apart on that, but we both recognize everything as a compromise and the Senate has to have some wins and we have to have some wins,” Knight said.
The Senate’s plan doesn’t address the standard deduction, cuts the state portion of the grocery tax (leaving out the local component), gives back smaller one-time rebates and proposes a refundable earned income tax credit.
In a press conference on Monday, Senate Democrats defended larger investments in K-12 schools, early childhood education, affordable housing and mental health services.
“I want to go to bat for our future. I want to go to bat for our kids. I want to make sure we have the best public school system,” said Senator Barbara Favola (D-Arlington).
“We have the resources to do it and we need to do it, rather than reckless tax cut gimmicks,” said Senator Adam Ebbin (D-Alexandria), referring to Youngkin’s recent gas tax holiday proposal.
On Monday, Youngkin sent down emergency legislation to the General Assembly hours after most lawmakers left for the day.
In a press release, Youngkin announced the legislation would be introduced by Delegate Tara Durant (R-Stafford) and Senator Steve Newman (R-Lynchburg).
If passed, the proposal would suspend the Motor Vehicle Fuels tax, which is 26.2 cents per gallon for gasoline and 27 cents for diesel, for three months beginning in May. It would then be phased back in throughout August and September, according to Youngkin.
“With gas prices and inflation squeezing families’ pocket books across Virginia and the nation and with over $1 billion in unanticipated revenue in our transportation fund, the general assembly must act now. Virginia should join numerous other states, led by both Republicans and Democrats, in temporarily suspending the gas tax. Actions speak louder than words, we can lower gas prices now for all Virginians,” Youngkin said in a statement.
Several Senate Democrats and at least one lead Republican budget negotiator, Senator Emmett Hanger (R-Augusta), are already skeptical.
In an interview, Hanger doubted that consumers would see the savings since the tax is levied on distributors.
Last week, Youngkin acknowledged in an interview that the proposal would not guarantee relief.
“No, I’m not an advocate for suspending the gas tax now. I think consumers would not see it at the pump and it would probably just be to the benefit of big oil,” Hanger said. “It would have a significant impact on our ability to fund our transportation projects and we’re making good progress right now. I don’t want to slow that momentum.”
It’s not yet clear when the gas tax holiday will be debated or voted on.
