RICHMOND \u2014 The General Assembly passed a budget bill Monday that will head to Gov. Abigail Spanberger\u2019s desk. She will then be able to line-item veto or amend the legislation. In a statement, Spanberger said the bill was a compromise her administration was involved in crafting.<\/p>\n
\u201cThere is a lot to be proud of in this budget,\u201d she said. \u201cIt delivers raises for our teachers and public employees, makes new investments in our schools, includes a (Regional Greenhouse Gas Initiative) credit for residential customers and small businesses, and takes other tangible steps to make Virginia more affordable \u2014 all while protecting families from the devastating cuts in the so-called \u2018One Big Beautiful Bill.\u2019 \u201d<\/p>\n
The budget compromise includes collecting up to $1.2 billion in an energy consumption tax on data centers, but there are significant environmental, education and local spending measures, too. Here\u2019s a deeper dive on what is and isn\u2019t in the budget:<\/p>\n
Environment<\/p>\n
The budget would dedicate nearly half of funding from the Regional Greenhouse Gas Initiative to a rebate to customers from public utilities. That\u2019s a change from when Virginia was a part of RGGI from 2021-23, when the majority of revenue generated went to flood prevention and low-income energy efficiency programs.<\/p>\n
RGGI is a multistate compact<\/a> designed to disincentivize carbon dioxide emissions by requiring energy producers to purchase at auction a limited number of carbon allowances \u2014 one allowance per one short ton of carbon emissions. Republican Gov. Glenn Youngkin pulled Virginia out of RGGI, a move later ruled illegal. But with Democrats in the majority in both houses and with control of the governor\u2019s mansion, Virginia will rejoin RGGI beginning July 1.<\/p>\n Previously, half of funds generated through RGGI auctions went to low-income energy efficiency programs and 45% of\u00a0went to the Community Flood Preparedness Fund, which funded millions of dollars of projects in Hampton Roads<\/a>. Under the compromise budget proposal, those programs will still receive funding, but 45% of the entire poty, which could be $400 to $500 million, would go toward electric bill rebates. That has some environmental advocates worried.<\/p>\n \u201cI think it\u2019s really important for folks to understand that the Community Flood Preparedness Fund is always over-prescribed,\u201d said Jay Ford, Virginia policy manager at the Chesapeake Bay Foundation Virginia. \u201cWe have not gone through the process of figuring out what the total climate adaptation cost is going to be in Virginia, but there is broad recognition that it is in the billions of dollars.\u201d<\/p>\n Diverting those funds from flood prevention and energy efficiency programming is short-sighted as a policy, Ford said, particularly as Hampton Roads experiences increased flooding.<\/p>\n Some lawmakers believe the dollars that end up going toward energy efficiency for low-income Virginians and flood preparedness won\u2019t change much compared with Virginia\u2019s last go-round with RGGI, because the value of carbon allowances has gone up considerably. That means there\u2019s more money to play with generally.<\/p>\n \u201cThe excess money, a lot of it\u2019s going back to rate payers,\u201d Sen. Majority Leader Scott Surovell, D-Fairfax, told reporters Monday. \u201cNone of those refunds are going to data centers.\u201d<\/p>\n But Ford said the amount deposited into the flood preparedness fund was insufficient in the first place.<\/p>\n \u201cPegging it to what the previous price of carbon was is arbitrary at best,\u201d he said. \u201cEvery locality in Hampton Roads is depending on the Community Flood Preparedness Fund being robustly funded in order to put these projects on the ground.\u201d<\/p>\n Environmental activists also were disappointed that $2 million included in previous House budget proposals to study the Chesapeake Bay\u2019s menhaden population was left out of the compromise. The budget proposal does include $329.5 million for the state\u2019s share of wastewater treatment plant improvements and $43.5 million for the Stormwater Local Assistance Fund that aims to reduce water pollution through stormwater design.<\/p>\n Education<\/p>\n In addition to 4% raises for teachers<\/a> each year of the biennium and $519 million in grants for school construction, the budget bill contains additional funding for students with disabilities and students from low-income backgrounds. That includes an added $158 million for special education students and $29 million for K-12 students living in communities with the highest poverty levels.<\/p>\n Education advocates noted that the $29 million was less than was allocated in previous budget proposals \u2014 the Senate proposal from last week would have allotted $50.9 million.<\/p>\n \u201cThis budget reflects real, hard-won progress for Virginia\u2019s public schools, and we are grateful to the advocates, educators, and families whose voices helped shape it,\u201d the Fund Our Schools Coalition said in a statement. \u201cBut Virginia\u2019s students, especially those in our highest-poverty communities, deserve more than incremental gains.\u201d<\/p>\n The Virginia Education Association praised the significant investments in special education but characterized the teacher raises as\u00a0only keeping up with the cost of inflation.<\/p>\n \u201cEducators and school staff are still trying to afford rent or a mortgage, groceries, child care, health care, transportation and student loan payments on salaries that have lagged behind for far too long,\u201d said Carol Bauer, VEA president, in a statement. They deserve competitive pay that lets them feel real progress in their lives, not just cost-of-living adjustments.\u201d<\/p>\n Local spending<\/p>\n The budget bill includes a 20-year, interest-free treasury loan of $40 million to Newport News for housing infrastructure in a project that aims to construct a nearly 1 million square foot complex with 750 apartment units<\/a> and is expected to cost $450 million.<\/p>\n Two Virginia Beach projects are poised to receive funding in fiscal year 2027 through budget amendments if approved.<\/p>\n The city will receive an economic development incentive payment from the general fund of $5 million for Atlantic Park<\/a>, contingent on a memorandum of understanding between the secretary of commerce and trade and the city. The funding may be applied to engineering, infrastructure, maintenance and other related development and expansion costs. The $350 million mixed-use project<\/a> recently opened and includes the Dome entertainment center, a surf lagoon, apartments, retail and restaurants. Virginia Beach is a partner in the project along with Venture Realty Group and music superstar Pharrell Williams.<\/p>\n Also, the city would receive $500,000 from the general fund to support renovations and preservation of Nimmo United Methodist Church<\/a>, built in 1791. The building was used by Union troops as a hospital during the Civil War. Church leaders have requested Nimmo church be removed from a city-designated historic and cultural district<\/a> citing cost prohibitive standards for repairs, according to the city. The City Council deferred a decision on the matter until the state budget is approved.<\/p>\n