RICHMOND — Virginia’s General Assembly session appears increasingly likely to extend past its scheduled adjournment Saturday as negotiators from the Senate and the House of Delegates work to overcome differences in the state budget, lawmakers said Tuesday.
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The top sticking point: Gov. Glenn Youngkin’s call for doubling the standard deduction on state income taxes, which the Republican-controlled House favors and the Democratic-controlled Senate does not. That and several smaller differences on taxation create a funding gap of some $3 billion between the competing spending plans passed by each chamber.
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“We’re trying really hard to come to some agreements, but we’re still very far apart,” Sen. Janet D. Howell (D-Fairfax), chairwoman of the Senate Finance and Appropriations Committee, said Tuesday after an impromptu discussion with her House counterpart in a hallway of the Capitol.
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Budget conferees have a technical deadline of Wednesday night to reconcile their differences and produce a unified spending plan. That meets the procedural requirement of making the budget available for review for 48 hours before being printed and voted on by Saturday, the scheduled final day of a session that convened Jan. 12.
Those rules can be waived, and Howell said there’s a chance a deal will come together in time. “It’s still possible,” she said. “My view is it’s going to break very quickly or it’s not going to break, and at this point we don’t know.”
But Del. Barry D. Knight (R-Virginia Beach), chairman of the House Appropriations Committee, said he doubts they’ll meet the schedule.
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“I don’t think we’re going to make it,” he said, blaming a tight agenda that includes a full day lost to making regional judgeship appointments on Wednesday.
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If the spending plan remains unfinished, most lawmakers could go home as planned on Saturday while budget negotiators continue their work. Once they agree on a budget, the legislature could come back into session to vote on it.
Knight said he believes negotiations could wrap up as soon as Saturday, meaning lawmakers could return as soon as early as next week to wrap things up.
Both Knight and Howell said the standard deduction question is the single biggest hurdle, and both said negotiators have moved closer to one another.
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“There could be” middle ground, Howell said, though she declined to elaborate. A bipartisan group of senators have said they would rather take a year and study the tax code before making such a major change, which would affect revenue for years to come.
Democrats “have shown a willingness to negotiate with me,” Knight said. “We both agreed that we are open to all ideas and everything is negotiable.”
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Knight said he is aware that Youngkin (R) is pushing hard for doubling the standard deduction to fulfill a promise he made last year on the campaign trail. But he said the governor has not been involved in negotiations and that the budget is a matter for the legislature to decide.
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“It’s my thing. I know what the governor would like. He’s my governor; I’ve got that in the back of my mind,” Knight said. “But it is called House Bill 29 and House Bill 30, and I am the patron. … I don’t brief him on a regular basis, but once in a while I’ll kind of tell him negotiations are going fine, we’re making movement. Generically, I’ll keep him in the loop.”
Youngkin sent a letter to lawmakers over the weekend, as is traditional, urging them to keep working as long as it takes.
Knight said budget conferees initially separated into small groups and looked at each of nine separate budget policy areas, such as K-12 education and health and human resources. They created side-by-side versions of the House and Senate plans to see where the differences lie.
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House and Senate leaders have traded offers and counteroffers, Knight said, and are very close on some issues — such as exempting a portion of military pensions from taxation and reconciling differences in pay raises for state employees. The House had favored 4 percent raises in each year of the biennial budget, plus 1 percent bonuses; the Senate had proposed straight 5 percent raises.
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“We’ve gotten some creative ideas on that,” Knight said, though he would not be specific.
But spending on higher education and some salary and compensation issues remain sticking points, he said, in addition to tax cuts.
Knight said he had worked on the budget nearly 17 hours on Monday and would do the same on Tuesday.
“So far we’ve all been working in good faith,” he said. “I have zero bad to say about my Senate counterparts over there, and I think they would tell you the same thing.”
correction
A previous photo caption incorrectly identified Virginia Beach Del. Barry D. Knight's political party. He is a Republican. The caption has been corrected.