Virginia Legislative Session Preview

December 14, 2018

Pardon Our Dust

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The Virginia General Assembly meets every winter for its legislative session. The 2019 session of the Virginia General Assembly is a “short session,” meeting for 45 days to address thousands of pieces of legislation and amendments to the governor’s biennial budget. The governor will announce his amendments to the budget on Dec. 18, and the General Assembly will convene Jan. 9 to address them and several significant legislative items. Expect the following items to generate extensive debate this session:

Budget amendments. Due to unanticipated costs in the Department of Medical Assistance Services’ managed care programs — and despite a revenue surplus — budget writers indicated that any amendments to the 2019-2020 Biennial Budget will focus on mandatory items, such as addressing these Medicaid costs and other “must-dos” as determined by Gov. Ralph Northam and the General Assembly. Notably, the governor has announced new K-12 spending initiatives; items from the Amazon HQ2 deal will also be considered and approved in this process.

Tax conformity. Tax conformity will be one of the most significant issues discussed in the Virginia General Assembly this session, in the wake of the federal 2017 Tax Act. Republican legislative leaders indicated that they favor changes that would allow taxpayers to continue to itemize their state tax returns even if they decide to claim the standard deduction on federal returns. Gov. Northam released a proposal that would allow Virginians to “receive the full benefit of the earned income tax credit” and is calling the projected tax revenue “an opportunity to level the playing field” for taxpayers with an income of $54,000 or less. Regardless, the General Assembly will consider adopting emergency legislation to conform codes in time for the 2018 tax return season. The U.S. Supreme Court’s decision on online sales tax also will be a large part of the tax conformity/reform discussion.

Virginia’s Certificate of Public Need law. Last year, 16 bills related to Virginia’s Certificate of Public Need (COPN) law — most of which involved directives that ambulatory surgery centers or MRI clinics be allowed in various parts of the state — died in the House of Delegates Health, Welfare and Institutions (HWI) Committee. Two more were left in the Senate Education and Health Committee. The current COPN law requires state health department approval of new hospital and clinic facilities. Following robust debate during the 2018 session, a special subcommittee was tasked with looking into COPN. HWI Chairman Robert Orrock (R) prefiled legislation proposing several procedural and substantive changes to Virginia’s COPN laws.

Sports-betting/gaming reform. Sen. Chap Peterson (D) and Del. Mark D. Sickles (D) announced in late November that they were filing separate bills to legalize betting on professional sports. Both bills would exclude college sports. This comes on the heels of the U.S. Supreme Court’s ruling in May striking down the Professional and Amateur Sports Protection Act, which largely outlawed sports betting outside of Nevada. In Southwest Virginia, Sen. Bill Carrico (R) and Del. Israel O’Quinn (R) initiated a timeline for introducing legislation connected to the Bristol Casino project. For the casino to open in the former Bristol Mall space, Virginia law would have to allow casino gambling. The lawmakers indicated that any proposed legislation will include a public referendum giving voters in the proposed area the final say over whether the project moves forward.

Redistricting proposal. Two Virginia state senators recently announced their support for a proposed constitutional amendment that would create a citizens committee to draw legislative districts. Sen. Emmett Hanger (R) and Sen. Mamie Locke (D) backed the proposal initiated by OneVirginia2021. Ultimately, the proposed redistricting committee will consist of three Republicans, three Democrats and four Independents. The legislation comes in response to the June 2018 court ruling that the lines for 11 House districts were drawn unconstitutionally. Currently, an appeal from House Republicans is under review by the Supreme Court of the United States. Speaker of the House, Kirk Cox (R), requested a stay in the remedial map-drawing process while the Supreme Court reviews the appeal. For the legislative proposal to take effect before the district lines are redrawn in 2021, it must pass the General Assembly in 2019. If it passes, it will go through another round of votes in 2020 before it can appear on the ballot that November. 

Education. On Dec. 11, Gov. Northam announced that his proposed budget will include $286.7 million in new money for investments in K-12 education in Virginia. Teachers will receive an additional 2 percent raise, totaling $88 million, resulting in a total 5 percent raise effective July 1, 2019. The proposed budget also includes $70 million to boost the At-Risk Add-On and Supplemental Lottery Per Pupil Allocation. The At-Risk Add-On program targets state support to schools with the highest concentrations of students eligible for free lunch to provide dropout prevention, after school programs and specialized instruction. The supplemental lottery helps local school divisions to supplement general aid. Full details of the plan were shared with the Joint Money Committees Dec. 18. In addition to the governor’s proposed investment in education, the 2019 legislative session will most likely bring additional legislation to help address issues around teacher shortages and access and quality to early childhood education programs. In higher education, we anticipate continued discussions on access, affordability, and greater partnerships with business to create/expand internship and other similar work experience opportunities for college students.

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