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Commonwealth of Virginia
Office of Governor Terry McAuliffe

Today at a press conference in Richmond, Governor Terry McAuliffe announced the savings actions he will execute to eliminate the revenue shortfall in the Virginia budget for Fiscal Year 2015.

Due to revenue collections that came in under the budget projection set in 2013, the Governor asked executive branch agencies to submit budget reduction plans of 5% for Fiscal Year 2015 and 7% for Fiscal Year 2016 in order to close an $882 million budget deficit. Today’s announcement focused on the Governor’s budget reduction strategies for FY2015.  

“Making these budget reductions has been the most difficult experience of my term so far,” said Governor McAuliffe. “In a government as lean and well-run as ours, there are few spending cuts you can make without impacting the lives of Virginians. The goal was to keep lay-offs to a minimum and protect our core services. The budget I present in December will be a sound and balanced approach to navigating the challenges we face and building a foundation for a stronger economic future.”

Below are a copy of the Governor’s prepared remarks.
 
Governor’s Remarks - Budget Savings Plan Announcement
 
Good Morning.  Thank you for being with me here today.
 
Today, I am here to announce my actions on the budget for fiscal year 2015.  After much deliberation, discussions and hard decisions, I am presenting today the approved budget savings plan.  
 
Before I begin, I want to discuss the process, which is almost as important as the outcome.  
 
When I came into office in January, I promised to work together with the General Assembly to find common ground on issues of importance to all citizens of the Commonwealth.    From SOL reform to transportation prioritization to job creation, we came together to make Virginia a better place to live, work and prosper.  
 
Toward the end of the fiscal year, we started to see revenues not meet the forecast set out in 2013, before I took office.  This would create a shortfall for fiscal year 2014.  
 
I took immediate action.
 
First, I notified the leadership of the money committees and promised to work with them every step of the way to fill this shortfall.
 
Second, I directed all agencies to be prudent and curb any excess spending.
 
The General Assembly created budgetary reserves totaling $846 million in the current Appropriations Act.  In addition, $705 million could be withdrawn from the Revenue Stabilization Fund during the two year period.  These two items provide a “cushion” of $1.55 billion to address the revenue shortfall.    
 
Unfortunately, this wasn’t enough.  
 
The total shortfall in the new interim forecast is projected to be $2.4 billion. This means the problem remaining is $882 million. Of this amount, $346 million will have to be found in this fiscal year, while $536 will be needed in fiscal year 2016.  
 
On August 15th, I asked all agencies to submit budget reduction plans of five percent in fiscal year 2015 and seven percent in fiscal year 2016.  These plans were due on September 19th to my office.  
 
During this time, I worked closely with the leadership of the General Assembly to set out the parameters for the cuts. The outcome was HB 5010, a supplemental appropriations bill that outlined the process and the amount of cuts from four areas:

  • From executive branch agencies, $92.4 million in FY15 and $100 million in FY16
  • $45 million each year from higher education
  • $30 million each year from local governments
  • $102 million in unobligated balances in FY15 and $262 million in FY16

 In addition, the bill authorized use of the Revenue Stabilization Fund for both fiscal years 2015 and 2016.  
 
I asked for three things to be a part of HB 5010, and I am glad to see they were all included in that legislation.  
 
The first request was that there would be no cuts to K-12 education in the first year.  We need to protect our core services including K-12.  All school divisions have already started the school year with a set budget adopted last spring.  
 
It would be irresponsible to make changes now.
 
Second, I asked that the money designated for “A Healthy Virginia”, my healthcare access plan, be preserved.  This bill gives me flexibility to utilize the remaining balance in the Health Care Fund to move forward with these much needed initiatives.
 
Finally, this budget bill allows me to reallocate $5 million for economic development and workforce training - both top priorities of mine.    
 
Making these decisions today has been an exhaustive process.  We have worked hard over the past few weeks to get to where we are today.  Some initial options were unacceptable, and we had to ask for a different strategy.  
 
My goal was to keep lay-offs to a minimum and protect our core services.  The 565 lay-offs that will result from these actions comprise just half a percent of our state workforce of 120,000 full time equivalents, both wage and salary. Ninety percent of these lay-offs are from the Department of Corrections alone.  
 
I have been working with the Department of Human Resource Management and have put a plan in place to give these individuals the resources they need to find future employment.  Had we not prioritized state employee jobs, this situation could have been far worse.  
 
In addition to our efforts limiting layoffs, these are some of the other themes that define the actions we are announcing today:

  • We are improving business practices and efficiencies
  • We are eliminating unneeded contractors, including outside consultants and attorneys.  
  • We are leaving vacant positions unfilled.  
  • We are using nongeneral fund money instead of general funds when feasible and allowed by law or contract.

Specifically, we are doing the following:
 
For Department of Corrections, we are closing a correctional facility, a community corrections residential facility, a diversion center and delaying the opening of a women’s correctional facility.   This equates to $4 million in savings for FY 15

  • In the Department of Social Services, we are using one-time child care remaining balance of $2.7 million
  • For state police, we are selling one airplane and only filling 27 out of the 68 vacant trooper positions.  In addition, the state police will find an additional $4 million in operational efficiencies
  • For ABC, we are increasing the product mark-up on distilled spirits resulting in $2.5 million.

On December 17th, I will present to the General Assembly the budget for fiscal year 2016.
 
We will continue to review the 7% cuts in the second year, and I am not ready to make these decisions at this time.
 
I have asked my staff to look at alternatives. Let me be clear - everything is on the table.
 
If we can preserve core services that Virginians need by adjusting fees or eliminating tax preferences, we should. The budget I present in December will be a sound and balanced approach to navigating the challenges we face and building a foundation for a stronger economic future. I have enjoyed a strong working partnership with the leadership of the General Assembly on these issues so far, and I am looking forward to continuing our collaborative work in the 2015 session.
 
Making these budget reductions has been the most difficult experience of my term so far. In a government as lean and well-run as ours, there are few spending cuts you can make without impacting the lives of Virginians.
 
While this budget plan represents a sensible approach, I am cautiously optimistic about the fiscal future ahead. Some areas of the economy are recovering slowly while other areas remain stagnant. It is my hope that we have set our revenue estimate low enough that our slow recovery may boost our budget to the point where we could begin to undo some of these cuts and strengthen the investments our economy needs. But until we actually see that happen, we have a responsibility to remain cautious in the face of an uncertain future.
 
Later today I will meet with the Joint Advisory Board of Economists (JABE) to seek their council.  I will heed their advice as well as the Governor’s Advisory Council on Revenue Estimates when they meet on November 24th.   
 
While I believe they too will remain cautious, the news has not been all bad. As we announced yesterday, preliminary total revenues for the month of September were up 5.3 percent and through the first quarter of fiscal year 2015 they are up 6.7 percent, ahead of the annual estimate of 2.9 percent.  
 
This is the first time revenues have increased three months in a row since the second quarter of calendar year 2013.
 
Payroll withholding came in strong with 8.3 percent for the month due to an additional deposit day.  Sales tax collections are up about 3.5 percent for the month and are up 4.6 percent for the quarter.  This is ahead of the projected growth of 4.4 percent.
 
Recordation taxes finally had a positive month after falling for 13 straight months.  We saw a 1.9 percent growth in the month of September.
 
Even though this is positive news, we need to be prudent in the fiscal decisions we make.
 
As we saw last year, an unexpected revenue decline could be just around the corner. In the midst of uncertainty over sequestration and the federal budget, we have an obligation to prepare Virginia as much as possible for the reduction in federal spending that we know is coming.
 
The reductions we are announcing today are a short-term response intended to insulate Virginia from the possibility of even further cuts. And in the long-term, as I have said before, we must work together to grow and diversify our state economy so that we are no longer subject to Washington uncertainty.
 
And so my focus will remain on building a new Virginia economy that is stronger, more independent and more resilient. My administration is hard at work pursuing that goal on all fronts.
 
We are working to strengthen our education and workforce development system so that we are giving every student the skills he or she needs in a 21st Century economy.
 
Yesterday, we unveiled the 2014 Virginia Energy Plan, which will help drive our economy into the future by growing key sectors like wind, solar, nuclear technology and natural gas so that we can offer businesses the cheapest, cleanest and most abundant energy in the nation.
 
We are continuing to grow and strengthen our transportation infrastructure in ways that encourage economic growth and raise Virginia’s quality of life.
 
Our outstanding quality of life, world class workforce and outstanding infrastructure are real assets.  And so is Virginia’s long-standing reputation for sound management, even in the face of difficult situations.
 
This budget shortfall is not what I had hoped to be dealing with in my first year as Governor, but I am proud of the manner in which leaders on both sides of the aisle came together to address it.
 
Thanks to the hard work of Secretary Ric Brown and his team, who worked alongside Chairmen Colgan, Stosch, Jones and their staff, we are meeting these challenges in a way that protects our core assets, minimizes layoffs, and positions our Commonwealth for future growth.
 
While I know we all hope that the budget news from here forward will be more positive, all Virginians should be encouraged to know that their leaders are capable of coming together to get things done for the good of the Commonwealth.
 
Thank you. I will now be happy to take a few questions.

 

Office of the Governor
Contact: Brian Coy
Email: Brian.Coy@governor.virginia.gov
Phone: 804-225-4260

The Dulles Regional Chamber recognizes the importance of the healthcare industry to the economy and the community. For that reason, it supports appropriate federal and state reimbursement levels that allow primary care providers, specialists, and hospitals to care for patients and reduce the displacement of costs to those who are privately insured. The Partnership also supports maximum flexibility to encourage business to provide the best health insurance options for employees in the free market system.

Given action taken at the federal level in the healthcare arena, the Partnership remains extremely concerned about the impact of federal healthcare reform legislation on the business community and urges careful consideration of the impact of any policy change or development of regulations in this arena.   Specifically, we are concerned about the lack of predictability, understanding, and action by special interests related to the Affordable Care Act that places many businesses at a disadvantage.

The Chamber supports legislation that ensures access to affordable and stable group health insurance for all businesses, including sole proprietors and businesses with few employees. The Partnership supports legislation that reduces state burdens and provides tax incentives to help small businesses offset the staggering increases in health insurance costs, including incentives that encourage participation in “consumer-driven” healthcare and wellness plans. Further, the Partnership supports initiatives that: improve quality and lower costs; encourage fair regulation of the insurance market; build a robust healthcare insurance marketplace for consumers; expand the use of healthcare IT; create an emphasis on prevention, wellness, and personal responsibility; and promote pay-for-performance.   

On the issue of Medicaid, the Chamber supports the expansion of Medicaid, concurrent with reform, with both components essential to the outcome.

The Chamber supports collaborative efforts between healthcare stakeholders, including providers, purchasers, insurers and consumers, to ensure continued innovation, creativity and transformation in the healthcare marketplace. The goals of these efforts should include the following:

  • Effective communication and education of the many changes in the healthcare laws and marketplace to create an informed consumer;
  • Expansion of healthcare infrastructure (both inpatient and outpatient) to meet community  needs;
  • Preservation of healthcare options in both the provider and insurance markets  that encourage competition to enhance choice and control costs;
  • Increase in the supply of well-trained medical personnel;
  • Effective management of healthcare costs impacting businesses;
  • Promotion of workplace and community wellness initiatives;
  • Increased accessibility of healthcare and insurance;
  • Enhanced quality, choice, unbiased data transparency, and diminished redundancies and waste in healthcare and
  • Appropriate planning for emergency preparedness and public-private partnerships to address pandemic preparedness.

Commonwealth of Virginia
Office of Governor Terry McAuliffe

Virginia Receives National Governor’s Association Grant
~ NGA grant will drive increased attainment of STEM-H Workforce credentials ~

RICHMOND - The National Governor’s Association (NGA) announced last week that Virginia has been selected to receive a $170,000 grant and will also be one of 14 states to participate in an 18 month national policy academy aimed at better aligning education and workforce training to economic development priorities.  

The NGA grant proposal was jointly submitted by the Governor’s Office and the Virginia Community College System.  Grant activities will focus on increasing the Commonwealth’s attainment levels of STEM-H (Science, Technology, Engineering, Math, and Health) credentials, including industry certifications, apprenticeship credentials and degrees, most needed by Virginia’s current and emerging businesses and industries.  This announcement by the NGA comes just a week after Governor Terry McAuliffe signed an executive order establishing his “New Virginia Economy” workforce initiative, a robust plan which calls for 50,000 new STEM-H credentials earned by the end of his administration.

“This grant will help in our efforts to enhance Virginia’s high tech, high skilled sectors, which are vital to the growth and diversification of the New Virginia Economy,” said Governor McAuliffe.  “This collaboration will send a strong signal to the emerging workforce of the immediate need for a credentialed, high-skilled labor force to meet today and tomorrow’s business needs.”

The NGA grant will support development of a statewide public awareness and marketing campaign; enhance data and analytical resources; encourage new and expanded public and private partnerships; and augment a policy agenda aimed at increasing enrollment and completion of STEM-H credentials.

Secretary of Commerce and Trade Maurice Jones was excited about the opportunity the grant provides.  “This grant will allow Virginia to take a big step forward in terms of workforce development,” Secretary Jones said. “The program will help us to better align educational offerings with workforce needs while paving the way for a unified vision of a Commonwealth made stronger by a vibrant, highly-skilled workforce.”

“Now more than ever, Virginia needs an educational system fit for the 21st Century,” added Secretary of Education Anne Holton. “By bridging the divide between education and business and bolstering the Governor’s workforce initiative, these funds will help us do just that.”

“Virginia’s businesses are hungry for highly-skilled workers,” said Dr. Glenn DuBois, Chancellor, Virginia Community College System.  “And, Virginia’s Community Colleges are proud to be a part of a grant that will ultimately help more Virginians to find their way to the training and credentials they need for good jobs.”

Secretary Jones will lead the Virginia State Leadership Team, including representatives of the Virginia Board of Workforce Development, business and industry, education at all levels, and economic and workforce development.  


Office of the Governor
Contact: Rachel Thomas
Email: rachel.thomas@governor.virginia.gov

Office of the Secretary of Commerce and Trade
Contact: Elizabeth Creamer, Advisor for Workforce Development
Phone: (804) 692-2563
Email: elizabeth.creamer@governor.virginia.gov

Asif Bhavnagri
Office of Governor Terence R. McAuliffe
Press Special Assistant
804.971.8513
asif.bhavnagri@governor.virginia.gov

19 "Exact Change" Lanes To "E-ZPass Only"

Work Begins September 2 on West-Bound Fairfax County Parkway Exit

To ease congestion and increase convenience for drivers, 19 toll-lanes along the Dulles Toll Road will be converted from “exact change” to “E-ZPass only” over the next year, the Metropolitan Washington Airports Authority, which operates the road, announced Wednesday.

During the conversion project, which begins Tuesday, Sept. 2, coin baskets will be removed and replaced by upgraded E-ZPass infrastructure.  Conversions are scheduled for unattended “exact change” lanes at the main toll plaza and exit ramps along the roadway.

“This lane conversion continues the long tradition of providing a convenient, consistent travel option for drivers in Northern Virginia,” said Dulles Toll Road Manager Cyndi Ward.  “About 90 percent of drivers currently using these lanes are already paying with E-ZPass rather than coins. Full-service lanes will continue to be available at all toll plazas along the roadway for those wishing to pay with cash, but we encourage drivers to consider the added convenience of E-ZPass in order to bypass the lines associated with cash payments.”

 Drivers can sign up for E-ZPass or find locations on how to pick up E-ZPass On-the-Go transponders in stores across the state at www.ezpassva.com.

To minimize congestion, lanes will be reconfigured one at a time, with each conversion taking two to four weeks.  When the project is complete, all toll plazas will still have at least one “full service” lane available.

The first lane to be converted will be the right-most lane on the westbound Fairfax County Parkway exit.

Washington, DC (PRWEB) - For the first time since 2008, the SBA has made significant changes to how it classifies small businesses. These changes came into effect on July 14th, 2014. The new adjustments were made to account for the inflation that has occurred since the last classification, which was based on data from 2007.

This adjustment will turn about 8,500 companies currently classified as large to small business, according to the Washington Post. The updates will mean that companies can make anywhere from $5.5 million and $38.5 million, depending on the industry, and still count as a small business.

Some have criticized this change, saying the new size limitations would bring in companies that should be classified as a large business. Opponents of the changes believe that these adjustments will be detrimental to those who they believe are “real” small businesses. This is key in understanding which companies will have access to the many small-business set-aside contracts that are available with the federal government.

The SBA explained its reasoning for the new size classification as based solely on trying to catch up to the rate of inflation. They believe that many companies have been pushed out of their small business classification due to inflation and should be included to compete for small business set-aside procurement opportunities, where they belong.

The SBA defended its position by saying the government will have more small businesses to choose from for their small business contracts. As a result, the new small businesses will have a better chance at winning opportunities. The government could also benefit from the lower prices that would result from the increased competition.

The SBA is accepting comments regarding this change.  Visit the website for more information.

The Washington Metro Area Transit Authority (WMATA) wants people to know about the strategic vision Momentum that they are putting forward to address tomorrow’s issues. They really want to hear from our local businesses and invite you to contact Greg Potts and fill out this form. The WMATA page Momentum Endorsements includes numerous organizations including the Dulles Regional Chamber—now they would like to add your company’s name to the roster.

Hooray! As of July 26, our area residents will have access to Metro Rail. For all the information you need to know regarding schedules, stations, prices, etc., go to silverlinemetro.com. If you click on “service”, there is a drop down menu where you can enter your station origin and station destination. It will tell you both the fare for your ride and the amount of time the trip will take.

With all of the quick changes in weather that occur throughout Fairfax County, you and your family should be aware of the most up-to-date storm information available that may impact your lives. Likewise traffic delays can cause trouble with schedules. The more time you have to prepare for flash flooding or violent thunderstorms, the better you can adjust your schedule and take shelter or change travel plans and routes to avoid a major accident.

Fairfax County has recently launched a new alerting system, Fairfax Alerts, which is designed to deliver timely information on changing weather conditions and significant traffic tie-ups.  The new service includes the ability to deliver alerts to any landline, Blackberry, SMS, pager, or email device. Features include a smart weather module that will customize weather alerts and times they are received, a mobile app for receiving alerts, and select two-way communication between you and the county’s emergency managers.

The system is available to Fairfax County residents and an account can be set up in just a few minutes. Each individual determines which alerts are needed. You can ask for alerts for more than one location such as your home address in Herndon and your daughter’s work location in Springfield. Go to our website to learn more and to sign up.