The Senate and the House of Delegates passed their respective budget bills last Thursday. Recognizing the prevailing economic situation of the Commonwealth, both chambers’ budgets reduce income and sales tax estimates and make significant funding cuts of $500 million per year.
Public Education funding, one of the most critical areas of the budget, reflects noteworthy differences in the proposed budgets. It is important to note that the Senate’s budget does not divert any lottery profits from public education.
We did not take the same actions as the House Appropriations Committee, which would take a step backward from the state’s responsibility for Standards of Quality funding. SOQs are a funding standard in which the financial health of a locality determines how much each division of government, state and local, provides for education funding.
The House effort to change the biennial process of rebenchmarking will have a very significant negative fiscal impact in the future by shifting more of the cost for school employee salaries and retirement benefits from the state to local governments. The Senate must prevent this development.
The Senate budget includes a 2.5 percent pay raise for teachers, effective December 2009 and a 2.5 increase for state employees, effective November 2010. The House budget would offer a 2 percent raise for both teachers and state employees, effective this November.
In light of budget reductions, the Senate necessarily scaled back on providing new funding for the Virginia Preschool Initiative (VPI) for at-risk 4 year-olds. In his February 12 recommended budget reductions, the Governor proposed adding $10.5 million for 2009 and $9.6 million for 2010 for VPI expansion. We have reduced that to $8.3 million in 2009 and $8.6 million for 2010.
There has been much misleading discussion from Senate Republicans about this program and the Senate’s funding plan. The reality is that VPI is not a new program, nor just a Democratic program. VPI was first funded in the administration of Republican Governor George Allen with an initial allocation of $10.3 million. Even the Republican-controlled House included some increased funding for the program this year.
I strongly support the Virginia Preschool Initiative. It is not only a matter of education; it is also one of the best economic development programs we could implement. In fact, one study shows that every $1 invested in early childhood development programs yields a return of $7.14 due to a reduction in crime, increased tax revenues, reductions in expenditures for special education and grade retention, reduced child welfare costs and increased earnings for program participants. The benefits of VPI are the reason why the Senate worked so hard to maintain as much of this program as is financially prudent.
It is my hope that during the budget conference process, when the two chambers will attempt to iron out their differences, the partisan divide will not be the determining factor in the budget, but rather what is best for the Commonwealth.