General Assembly ‘skinny budget’ fills school funding shortfall caused by Dept. of Ed error

While the General Assembly has been unable to make a deal on changes to Virginia’s two-year budget, lawmakers agreed Saturday to appropriate millions to Virginia’s public schools to address a $201 million error as part of a stopgap budget.

The spending plan includes $132.7 million for the current school year and $125.8 million for the next year.

Virginia school divisions last year used the Department of Education’s basic aid calculation tool to determine how much funding they were likely to receive from the state to support their budgets. However, in December, the department found the tool did not account for a provision to hold localities harmless from Virginia’s elimination of the state portion of the grocery tax. 

Virginia public schools seek solutions after Dept. of Ed error leads to $201 million shortfall

As a result, school officials faced funding shortfalls for the remainder of the school year and inaccurate estimates for their budgets for next year.

The shortfall statewide was about $201 million.  

Sen. Janet Howell, D-Fairfax, a co-chair of the Senate Finance Committee, said on Saturday that under the stopgap budget, school divisions would receive at least as much as the forecasted amounts communicated by the Virginia Department of Education last summer. 

“These updates are critical for local school divisions to be able to build their budgets for the coming year,” said Howell. 

The funding fix is one of only a few measures that the House and Senate agreed to pass as part of the so-called ‘skinny budget’ before they left Richmond Saturday. Others include funds for the state’s revenue stabilization fund, state construction projects and the Virginia Retirement System trust fund.

In December, Gov. Glenn Youngkin said Virginia expects an estimated $3.6 billion in excess revenue during the current fiscal year. However, the House and Senate have not agreed on a plan for how to deal with those funds, with Republicans pushing for tax cuts and Democrats for more spending on areas such as education. 

Del. Barry Knight, R-Virginia Beach, who chairs the House Appropriations Committee, said on Saturday the House is “committed” to finalizing a new spending plan.

Del. Marcus Simon, D-Fairfax, said on Saturday he hopes lawmakers will commit to completing the budget.

“I wish the Department of Ed had gotten this right,” Simon said, referring to the accidental funding shortfall. “I wish we could’ve kept working towards the priorities that we have, and I trust … that we still will keep working on getting through the impasse because there’s a lot of money that’s at stake here: money for our education, money for teacher pay raises, money for public employee raises, huge amounts of money for mental health that we all support and we can’t abandon that.”