eNews Special Edition – April 4, 2025
Will the governor sign the budget despite changes? Also - Items of importance to localities!
Friday, April 4, 2025/Categories: eNews
Most of the Governor’s proposed budget changes get nixed; Will he sign?
When state lawmakers returned to Capitol Square on Wednesday, April 4, 2025, for the annual Reconvened (or Veto) Session, the question on the mind of many observers was how the General Assembly would respond to Governor Youngkin’s numerous amendments and vetoes.
As a reminder, the Governor proposed amendments to 159 bills including 205 changes to HB1600 (the 2024-26 biennial budget) as well as 157 vetoed bills and eight vetoed budget amendments.
The consensus of many seemed to be that most of the Governor’s proposed budget amendments would be rejected, and the General Assembly would be unable to override the Governor’s vetoes to the budget due to the supermajority required to override a veto.
That sentiment seemed to carry the day.
The House of Delegates took up Governor Youngkin’s budget changes first, since the bill originated in that chamber. In quick order, the House rejected 164 of the Governor’s 205 proposed amendment, including his proposal to pare back funding for support positions within the K-12 system.
Del. Luke Torian, Chairman of House Appropriations, described the 41 amendments that the House agreed to as 14 amendments that eliminate language or funding associated with legislation that the Governor vetoed and 27 amendments that make technical adjustments or additional savings items that were not previously considered. Included in the 27 amendments the House agreed to were two provisions that would make permanent, increases to the 20 percent refundable earned income tax credit, increases to the standard deduction of $8,750 for single filers and $17,500 for joint filers, and the pass-through entity tax election. The annualized cost of these provisions is estimated at $1.3 billion.
Governor Youngkin had more success with budget items he proposed to veto. Two of his eight amendments, however, were ruled out of order and rejected on procedural grounds. Those amendments were determined to be related to the use of proceeds from the Regional Greenhouse Gas Initiative that was previously agreed to by the Governor and General Assembly.
When the budget moved to the Senate for consideration, the only amendments in front of the chamber were the remaining 41 amendments the House had approved. The Senate proceeded to reject an additional eight budget amendments. With federal policy and budget decisions adding uncertainty to the current economic environment and the Commonwealth’s general fund revenues, the Senate was hesitant to endorse the permanent extension of tax credits recommended by the Governor and approved by the House.
Now the plot thickens. Will Governor Youngkin sign the budget despite having most of his proposed changes rejected by the General Assembly? Or will he use his line-item veto to reject funding for items that he proposed to change? Or will he sign the budget bill and put an end to the current debate? He has 30 days to decide. When he does, VML staff will be there to provide an update.
VML Contact: Joe Flores, jflores@vml.org
Items of importance to localities
Among the Governor’s actions this week on budget and legislative items, VML member localities should be aware of the following:
Natural resources funding for localities slashed
VML Contact: Mitchell Smiley, msmiley@vml.org
$40 million in Stormwater Local Assistance Funding and $31 million for wastewater capital improvements have been removed from the budget entirely. This funding would have provided grants to localities to make improvements to mitigate stormwater and improve pollution controls on wastewater plants having the combined effect of improving water quality across Virginia and help clean up the Chesapeake Bay. The General Assembly did not reject the Governor’s line item vetoes for SLAF or the additional wastewater improvement funding resulting in the elimination of SLAF funding and wastewater capital project funding.
Window to report waterworks issues significantly reduced
VML Contact: Mitchell Smiley, msmiley@vml.org
The House and Senate accepted the Governor’s recommendations for HB2749 (Levere Bolling) and SB1408 (Reeves) to reduce the window for a waterworks operator to notify the Virginia Department of Health of a critical equipment failure or contaminant leak. The legislation as approved by the House and Senate required a six-hour window for reporting while the Governor’s recommendations reduce the reporting window to two hours.
Deadline to set lower towing fee removed
VML Contact: Mitchell Smiley, msmiley@vml.org
The Senate and House accepted the Governor’s amendments to SB1332 (Marsden) which will remove the fuel surcharge for trespass towing and allow localities to increase the cost of trespass tows up to $210 from $150 in current code. The Governor’s amendments remove the deadline for setting a towing fee lower than $210 that was proposed in the bill.
Acceptable media to verify active school zone warning signs expanded
VML Contact: Mitchell Smiley, msmiley@vml.org
The House and Senate accepted the Governor’s technical amendments to HB2718 (Leftwich). The amendments expand the forms of acceptable media to include videotapes to establish that school zone warning signs were activated at the time a photo speed enforcement ticket was issued to a vehicle exceeding 10 mph in a school zone.
Amendments to license plate reader regulation bill fail
VML Contact: Mitchell Smiley, msmiley@vml.org
The Governor amended HB2724 (Herring) to expand from 21 to 30 the number of days that data collected by license plate readers (LPRs) could be retained. However, on Wednesday the Governor’s amendments were passed by for the day in the House of Delegates. The enrolled bill can now be signed or vetoed by the Governor, or he can take no action which will allow the bill to pass into law without the Governor’s signature.
If the bill becomes law, the Commonwealth Transportation Board will be able to establish regulations for the operation of LPRs in state rights of way. HB2724 was a recommendation of the Virginia Crime Commission.
Governor’s amendments to employer liability legislation fail
VML Contact: Mark Flynn, mflynn@vml.org
The General Assembly rejected the Governor’s amendments to SB894 (Russet Perry) and HB1730 (Delaney). These bills create employer liability for tort actions of its employees in many more cases than allowed under current law. The Governor’s amendment would have limited the kinds of cases where the rule would apply to criminal sexual assault, sexual abuse of a minor, and wounding a minor. This new law will create liability for employers that does not exist currently and will potentially increase the cost of insurance for local governments, as well as all public employers.
Vetoes of public employee unions bills sustained
VML Contact: Mark Flynn, mflynn@vml.org
The General Assembly failed to override the Governor’s vetoes of the identical pair of bills that allow all public employees to join unions and participate in collective bargaining were sustained. HB2764 (Tran) and SB917 (Surovell) would have repealed the general prohibition on collective bargaining by public employees.
Amendment approved to eminent domain bill
VML Contact: Mark Flynn, mflynn@vml.org
As passed by the General Assembly, SB1158 (Obenshain) included one provision requested by local governments to correct a technical issue in the eminent domain bill passed in 2022. The Governor’s amendment makes that correcting provision apply only to actions commenced after January 1, 2026. The General Assembly approved the amendment.
HB1690 (Convirs-Fowler) amends the same section as SB1158 but kept the current law’s limit to cases of fee simple acquisitions whereas SB1158 applies to permanent easements, as well as taking the fee simple rights to the property. The result is that the law will only apply to fee simple takings cases filed before January 1, 2026. After that date, the law will apply to permanent easements as well as fee takings.