Budget includes economic development priorities
- March 15, 2010
The $70-billion two-year budget passed by the General Assembly this weekend includes many new economic development initiatives.
The budget includes an additional $12.1 million for the Governor’s Opportunity Fund and $5 million for an industrial mega site. It also includes $1.5 million to open economic development offices in China, India and the United Kingdom and $4.5 million for economic development marketing and promotion. It makes $3 million available for bioscience and wet lab facilities.
The plan also includes a big boost for tourism. The budget includes $7.2 million more for tourism marketing, $2 milllion to encourage movies to be filmed in Virginia and $1.49 billion for the Wine Promotion Fund.
Gov. Bob McDonnell had pushed for economic development investments to help Virginia emerge the economic downturn. The state Senate and House of Delegates agreed on a budget that took major cuts in health care and education to make up a $4.2 billion shortfall. The budget now goes to McDonnell for any amendments or vetoes.
The budget makes up much of the shortfall by deferring its $620 million payment to the Virginia Retirement System. It will begin repaying the money in 2013 with a 7.5 percent interest rate.
About $100 million fees for state services are part of the budget.
The budget cuts $250 million from public education, but gives localities more flexibility on where to cut their money. The Virginia Education Association has predicted the cuts will mean thousands of jobs lost.
State workers will have no additional furlough days in the next budget but will not receive a pay raise. Depending on revenues, they may receive a 3 percent bonus in December 2011. Future state workers will also be required to contribute 5 percent to VRS.
The budget also preserves about 40 percent of the “dealer discount” for the state’s smallest retailers. The dealer discount was designed to help businesses collect sales tax.