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15 things to know about the budget deal Virginia lawmakers just reached

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15 things to know about the budget deal Virginia lawmakers just reached


Virginia has a budget deal.

It’s late in the sense that the expectation had been the General Assembly would work this out before it adjourned back in March. However, it comes 12 days before the state starts a new budget year, so lawmakers will apparently not be taking things to the brink. The legislature reconvenes Monday to take up the spending plan that House and Senate negotiators released Friday night.

The exact details (which will be voluminous) haven’t been posted on the General Assembly’s website yet. We do, however, have a 68-page summary that outlines what’s in the deal. The headliner: a compromise on data center taxation that keeps the controversial tax incentives in place but creates a new tax on the electricity they use.

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The other highlights — as seen from the standpoint of Southwest and Southside — include funding to start construction of an inland port in Washington County and expand the Virginia Tech Carilion School of Medicine, as well as language authorizing a formal partnership between George Mason University and Averett University. One surprise: $100,000 to fund a statue in Roanoke of the late judge and lawmaker Onzlee Ware.

Gov. Abigail Spanberger and legislative leaders had earlier reached an agreement on how to legalize retail sales of cannabis. That’s now included in the budget deal, with sales starting July 1, 2027. See the earlier story by Cardinal’s Richmond-based reporter Elizabeth Beyer for details.

Here’s an overview of what we know — with the caveat that more details will be forthcoming when the actual budget language is available.

1. Data center taxation compromise

An aerial view of data centers in Ashburn in Loudoun County. Courtesy of Theodore Christopher.

The main reason that the budget took so long is that Senate Finance Chair Louise Lucas, D-Portsmouth, spent weeks insisting that the state should eliminate its tax breaks for data centers eight years early. That brought pushback from both the governor and House leaders, who worried that would send a signal to other business sectors that the state can’t be trusted.

This deal keeps the tax breaks for data centers intact (they’re set to expire in 2035). Instead, it creates a tax on the electricity that data centers consume. When that was floated earlier in the week, business groups pushed back against it. The version in the budget deal calls for the revenue collected through that tax to be capped at $600 million a year — and says that any monies collected over that be refunded on a pro-rated basis at the end of the fiscal year. It was unclear what the reaction to this will be, but collecting $600 million a year seems a significant climb-down compared to those who wanted to do away with the tax exemption that forgoes $1.9 billion per year in exchange for $9.1 billion in gross domestic product from data centers.

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The summary also says there will be at least four items in the budget that will set in motion new regulations. Among them are references to “data center noise regulation language” and “data center cooling water scarcity regulations.”

2. Inland port in Washington County

The Oak Park Center for Business and Industry in Washington County, a possible site for an inland port. Courtesy of Washington County.

An “inland port” does not involve water or ships. Instead, it’s the industry term for a freight hub that collects cargo headed to or from a water port. Virginia already has an inland port near Front Royal that facilitates rail shipments to and from Hampton Roads; it’s also spurred thousands of warehouse and trucking jobs in the northern Shenandoah Valley.

Legislators in Southwest Virginia — led by state Sen. Todd Pillion, R-Washington County — have been pushing for several years to create a similar inland port in Southwest Virginia, specifically at the Oak Park Center for Business and Industry in Washington County.

This deal includes $20 million to get construction started. (Pillion is one of the budget negotiators so was in a position to make sure this money was included in the budget.)

3. Virginia Tech Carilion School of Medicine and other healthcare workforce funding

The Department of Neurosurgery will be the 12th at the Virginia Tech Carilion School of Medicine, pending approval by the State Council for Higher Education in Virginia. Courtesy of Virginia Tech/Ryan Anderson.

The school in Roanoke is slated to get $13 million for expansion as part of a larger $74.4 million plan to expand the healthcare workforce.

Nursing programs at James Madison University, Radford University and the University of Mary Washington will get a total of $7.6 million.

The budget deal also includes $6 million for the Virginia Tech Patient Research Center and $500,000 for workforce development programs in the Roanoke Valley and Alleghany Highlands in healthcare and biomedical sciences fields.

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4. Interstate 81

Interstate 81 near Exit 132, the Dixie Caverns exit. Courtesy of the Virginia Department of Transportation.

The budget directs the secretary of transportation to “evaluate options to Accelerate I-81 Projects; including tolling options as long as there are 2 toll-free lanes in each direction.” That seems to foreshadow a third lane that might have tolls. Del. Terry Austin, R-Botetourt County and a budget negotiator, said Secretary of Transportation Nick Donahue wanted that provision.

5. Virginia Coalfields Expressway

The section of the Coalfields Expressway at Southern Gap in Buchanan County is now open to traffic.
The section of the Coalfields Expressway at Southern Gap in Buchanan County has opened to traffic. Courtesy of Jonathan Belcher.

The slow-moving road project that’s slated to run through Buchanan County and Dickenson County gets $7 million for improvements to U.S. 460 in Buchanan County.

6. New College Institute

The New College Institute campus at the Baldwin Building in Martsinville.
The New College Institute campus at the Baldwin Building in Martinsville. Cardinal News file photo.

The budget changes the name of the Martinsville-based center from the New College Institute to the West Piedmont Higher Education Center and includes funding in the second year of the two-year budget. When then-Gov. Glenn Youngkin introduced his budget back in December, he had zeroed out that second-year funding.

7. George Mason University/Averett University

a large brick building with many windows and white columns in front, the main hall at Averett University, stands behind a historic marker about the school
Averett University in Danville. Photo by Grace Mamon.

Del. David Reid, D-Loudoun County, has pushed for a formal partnership between the public school in Northern Virginia and the private school in Danville as a way to expand GMU’s reach. The budget deal includes the language to make that happen. It’s unclear what that will mean in practice, but the budget language authorizes George Mason to work with Averett on both undergraduate and graduate programs as well as other workforce-related issues. There’s no money attached, but the language lists multiple groups that would be allowed to help fund this work, including the GO Virginia economic development program, the Tobacco Commission, the Virginia Economic Development Partnership, the Danville Regional Foundation and other nonprofits.

“I’m pleased GMU will now have official authorization to move forward in what is probably the most dynamic economic area of the Commonwealth,” Reid said in a text message.

8. Onzlee Ware statue in Roanoke

Onzlee Ware
Onzlee Ware Courtesy of RMC2012

An unexpected item was $100,000 for a “Roanoke commemoration.” Legislators said this was for a statue to the late Onzlee Ware, the first Black state legislator west of the Blue Ridge and later a judge.

House Appropriations Chair Luke Torian, D-Prince William County, was cited as the proponent of this measure. “Onzlee was a bit of a mentor to Torian,” said Del. Sam Rasoul, D-Roanoke, a member of the House Appropriations Committee.

9. Local referendums on sales tax increases for schools

At present, nine localities are authorized to hold referendums to increase the local sales tax, with the proceeds going to schools. There’s been a push to expand that power statewide. In this year’s General Assembly session, bills related to these local referendums were set aside with the expectation that they’d simply be written into the budget. Now they are, with the sales tax increase capped at 1%.

10. State funding formula

A panel will be appointed to study whether and how to change the state’s school funding formula; $1.3 million is set aside for this.

11. New or renovated college buildings

There’s money (unclear how much) to renovate Derring Hall at Virginia Tech and Darden Hall at the University of Virginia’s College at Wise.

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12. Institute for Advanced Learning and Research

The Center for Advanced Manufacturing at the Danville institute is slated to get money for expansion, although it was unclear how much.

13. Housing

The lack of housing — and the high cost of what is available — has been the subject of legislative attention. Among the initiatives: This budget deal authorizes a state loan for Newport News to develop housing around the shipyard as well as other housing construction initiatives in Fairfax County and Prince William County.

14. Richmond Coliseum

The budget deal includes $15 million to help Richmond demolish the Richmond Coliseum, which has been deemed to be obsolete.

15. Tourism

About 3,800 people attended the inaugural Blue Highway Fest last year in Big Stone Gap. Photo courtesy of the town of Big Stone Gap.
The Blue Highway Fest last year in Big Stone Gap. Photo courtesy of the town of Big Stone Gap.

Included in tourism funding is $100,000 for the annual Blue Highway Fest in Wise County. We’ve previously written about that award-winning music festival. Another tourism-related funding item is $305,000 for Breaks Interstate Park, the Virginia side of which is in Dickenson County.

You can read the full summary below. We’ll take a deeper look at the budget deal once we can see the actual language.

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Virginia

Drought emergency declared for parts of Virginia; governor warns of water restrictions

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Drought emergency declared for parts of Virginia; governor warns of water restrictions


Extreme drought conditions in parts of Virginia have prompted an emergency drought warning for a wide swath of the region, including Bedford, Campbell, Charlotte, Franklin, Halifax, Henry, Mecklenburg, Patrick, Pittsylvania and Roanoke counties, along with the cities of Danville, Roanoke, Salem and Martinsville.

The governor has warned that if conditions worsen, she will activate mandatory nonessential water-use restrictions.

In Martinsville, city leaders have issued a voluntary water conservation notice and are urging residents and businesses to cut back where they can. The request comes as local businesses that rely heavily on water say the drought is already affecting day-to-day operations.

SEE ALSO: Botetourt County residents adjust daily routines as voluntary water restriction continues

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John Hughes, owner of John’s Car Wash, said the dry conditions have hit his business hard in recent weeks. “For the last 3 weeks, it’s been hitting pretty hard. We done three yesterday and haven’t done anything today with the drought and hot weather. Yeah, I’m really concerned about it,” Hughes said.

Restaurants are also feeling the strain. David Kitzmiller, an owner of Be Wiched, said water is essential for routine tasks such as washing dishes and preparing some menu items.

“We use a lot of water for washing dishes and some of our recipes if they limit us in anyway defiently can’t produce and its a scary aspect,” Kitzmiller said.

Kitzmiller added that cutting back is not always realistic for businesses that must meet sanitation needs. “Not really feasible for a business that depends solely relies on water to wash their dishes, so that can’t definitely be an impact there,” he said.

City leaders emphasized that the conservation request is voluntary for now, but they are encouraging everyone to do their part by taking shorter showers, turning off the faucet when it is not in use, washing only full loads of laundry, and limiting outdoor watering whenever possible.

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Five charged after Virginia Beach Police conduct human trafficking operation

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Five charged after Virginia Beach Police conduct human trafficking operation


VIRGINIA BEACH, Va. (WAVY) — Five people were charged after Virginia Beach Police conducted a two-day human trafficking and vice operation on July 3, according to the Virginia Beach Police Department.

The department’s Special Investigations Bureau conducted the operation, which was aimed at identifiying human trafficking victims, reducing the demand for commercial sex and targeting individuals seeking to exploit or recruit children for prostitution.

Detectives used many investigative techniques to proactively identify individuals involved in criminal activity related to prostitution, human trafficking and offenses against children. The operation was conducted in Virginia Beach, involving personnel from all of the bureau’s squads.

As a result of the operation, five people were identified and charged with offenses ranging from solicitation of prostitution to sex trafficking and crimes involving minors. Two vehicles and U.S. currency were seized during the operation. Other people were connected to victim services through Samaritan House.

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The operation led to the following people being charged:

  • Shane Carter, 28, of Norfolk, was charged with solicitation of prostitution.
  • Robert Harris, 64, of Virginia Beach, was charged with solicitation of prostitution and assault and battery.
  • Larry Pittman, 53, of Portsmouth, was charged with sex trafficking and use of electronic devices to facilitaate certain offenses involving minors.
  • Kenric Frazier, 46, of Portsmouth, was charged with sex trafficking, use of electronic devices to facilitate certain offenses involving minors and solicitation of child pornography.
  • Cameron Lewis, 24, of Norfolk, was charged with solicitation of prostitution.

Investigators also developed leads about people who are suspected of trafficking and exploiting others for commercial sex. Those are now active and ongoing investigations. There may be more charges and arrests pending further investigation and consultation with the Virginia Beach Commonwealth’s Attorney’s Office.

If you’re a human trafficking victim or know someone who is, you can report it to the National Human Trafficking Hotline at 1-888-373-7888.

Continue to check WAVY.com for updates.



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Dragas responds to accusations of having unfair advantage in quest to buy VB National

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Dragas responds to accusations of having unfair advantage in quest to buy VB National


VIRGINIA BEACH, Va. (WAVY) — Helen Dragas, CEO of Dragas Companies, said she does not feel her company had an “unfair advantage” in pursing a deal to buy Virginia Beach National Golf Club.

Rather, Dragas said her team took the initiative to put forward the “the “best competitive proposal we could.”

Next month, Virginia Beach City Council could vote to sell the 270-acre 18-hole course to Dragas, who along with Texas-based Century Golf, would redesign and refurbish the course. Dragas would then build nearly 660 housing units on the southern end of the property, and build a new childcare center.

Dragas’ proposal, titled “Princess Anne Landing,” was one of nine total groups who responded to the city’s request for proposals regarding of the future of the course.

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Still, many on both social media and in public comments have accused the longtime housing developer of having the upper hand, given that she had the city sign a non-disclosure agreement in 2024, more than a year before the city’s intentions of possibly selling the course became public.

As part of an interview Tuesday with 10 On Your Side, Dragas was asked about those accusations and other questions. Responses are edited for style and brevity purposes.

REPORTER: You’ve heard some of the criticisms … sitting through the public hearings. … How do you take it when people say that you got an unfair advantage?

DRAGAS: I say that we invested thousands of hours of hard work and due diligence watching public hearings, media council meetings, digging into those engineering studies that I referenced before that showed the deficiencies, … understanding the comprehensive plan, the Historic Overlay District, the ITA situation, all that. There’s a lot of complexity there and we invested a lot of time and energy to develop the best competitive proposal we could. We never knew we would see it, and we still don’t know if we’ll see a single cent of that investment back. And that’s competition and that’s initiative, and we live in a country that’s always rewarded initiative. And we took it. And while others might have been spending their time on other projects or other endeavors, this is what we were doing. So we didn’t receive any nonpublic information. We just did our homework and I think we tried to solve a lot of problems in one proposal: housing, homeownership, childcare, golf course, you know, redesign and refresh and reinvestment and a future tax stream for the course. So we think we come up with something that provides benefit, not just at offers, but to a lot of other constituents in the city as well. We’re really proud of it.

REPORTER: You were telling me that … long before even the auditors report, you had your eye on that that parcel and thought it would be good for houses. Correct?

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DRAGAS: Well, we always knew that there was that section that … could handle some housing, yes. And others did as well. There were other rentals. There was another unsolicited proposal or two. And then I think about half of the respondents to the proposal included housing.

Under the terms that have been negotiated between City Council and economic development staff for months in closed session, Dragas would purchase the roughly 270 acre course for $17.9 million from the city. The city will, in turn, give the $17.9 million back to Dragas, along with $1.8 million from the Virginia Beach Development Authority, to go towards an estimated $38 million golf course redevelopment.

On top of the nearly $20 million the city would give the development team for the golf course work, the city could contribute up to nearly $8 million in public infrastructure along Tournament Drive and Princess Anne Road, to include turn lanes, streetscape improvements, utility relocations, and a sewer extension.

REPORTER: Why does it need to be a public-private partnership?

DRAGAS: So right now the city has millions of dollars in deferred renovation — $7.7 million in identified stormwater deficiencies and remaining clubhouse and facilities repair. That doesn’t cover anything about renovating a 30-year-old course. And … everything needs a renovation, refurbishment at some point in its life, physical life. And so, this course needs that. There’s also public infrastructure that serves the entire area right there. So there’s some Virginia Beach Development Authority parcels that sit there and the first tee … as you probably know, is that land is going to be dedicated to the First Tee. There’s sanitary sanitary sewer infrastructure that serves all those parcels that was originally connected to be temporary, and that was almost 30 years ago. So the city has, I think, some deferred public infrastructure costs as well. What our proposal does is take the city off the hook for future maintenance liabilities. They’re actually going to come out of pocket less than they would if they just did the stormwater and the clubhouse repairs that were made, and in exchange, the city will have a $3.4 million a year tax revenue stream, a completely refreshed and refreshed renovated golf course, a badly needed child care facility and then, of course, the homes, homeownership opportunities for over 600 families.

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