HARRISONBURG — Four state lawmakers from the Valley reacted similarly to Democratic Gov. Terry McAuliffe’s announcement Friday that Virginia faces a revenue shortfall of $1.5 billion.
McAuliffe announced in July that the state closed the 2016 fiscal year on June 30 down an estimated $266 million in revenue. The picture came into sharper focus this week and was closer to $280 million.
In addition, the state forecasts $1.2 billion in lower revenue than was anticipated earlier this year, when the General Assembly and McAuliffe approved a $105 billion spending plan for this fiscal year and next.
Dels. Steve Landes, R-Weyers Cave, and Tony Wilt, R-Broadway, joined Sens. Mark Obenshain, R-Rockingham, and Emmett Hanger, R-Mount Solon, in blaming an influx of lower-paying jobs, which in turn produced lower sales and income tax revenue, for the shortfall.
“It’s different for the government than it is for you and me,” Wilt said. “Your employer pays you, and that’s how you budget. With the government, it’s kind of a guessing game. You try to base a budget on what you believe the economy is going to do, and we didn’t see the growth we anticipated.”
Landes, who is vice chairman of the House Appropriations Committee, said he believes the shortfall could eventually prove to be worse than forecast at $1.7 billion.
“That’s still not as bad as the past — that’s the good news,” Landes said. “The bad news is the economy in Virginia. We’re adding jobs, but the new jobs are not as good-paying. Instead of 3 to 4 percent growth in tax revenues, it’s more like 1.6 percent — and that’s not healthy for Virginia.”
Landes, however, said he believed the Harrisonburg-Rockingham County area economy is in a better position to grow than Northern Virginia, Hampton Roads and metro Richmond, saying bioscience departments at James Madison University and Blue Ridge Community College could help create jobs for graduates who want to stay in the Valley.
“This [shortfall] is not unprecedented, and we will deal with it responsibly,” said Obenshain, a member of the Senate Finance Committee. “Virginia’s place as one of the best places to do business has fallen as some of our neighbor states have been more aggressive in making themselves more attractive to employers with higher-paying jobs.”
Hanger, who is co-chairman of the Senate Finance Committee, outlined ways in which the state could make ends meet while revenues lag.
“We have built into the budget a salary increase for state employees, and that might have to wait a little while,” Hanger said. “The budget language says if we don’t meet revenues, we can delay it. We’ll have to address that. That’s a piece of it.”