August 18, 2021
One-Time Surplus Will Not Reverse Decades of Underfunding Critical Public Services, Long-Term Solutions Needed
Joint statement from Virginia organizations on the need to invest in our communities and advance tax fairness
Richmond, VA — Today, the state announced an official budget surplus of $2.6 billion for the recently completed fiscal year. While this is positive news, this announcement cannot be a distraction from the fact that Virginia has had an upside-down and outdated revenue system for decades. A one-time surplus above a pandemic-suppressed forecast doesn’t mean we’ll have the funds to address many of our state’s most pressing and ongoing needs. We know that when our state government raises the resources to sustain transformative investments in education, health care, housing, and more, we can all thrive. We also know that these investments are critical to breaking down barriers that have continued to disproportionately hurt Black and brown people, low-income families, women, LGBTQ people, and more.
State lawmakers have the tools to strengthen our state revenue system. But for far too long, lawmakers have been unwilling to advance policies that would allow us to make the truly transformative investments that are necessary to build a more just and equitable state. Virginia schools continue to be underfunded, and currently require over $26 billion to upgrade school infrastructure, give teachers a much needed raise, and meet our Standards of Quality. Over 96,000 children in Virginia are without health insurance, requiring substantial state funding to remove barriers and connect children to coverage, which has life-long implications.
Across the state, tens of thousands of families face an eviction crisis, coupled with a longstanding housing affordability crisis, that requires a robust investment in the Virginia Housing Trust Fund. We also require significantly more resources directed to environmental justice initiatives to ensure everyone in Virginia has access to clean water and air, which is essential to healthy and thriving communities.
Unfortunately, state lawmakers have long upheld a system that limits our ability to raise the revenues we need to fund the building blocks of thriving communities through a tax system that tilts benefits towards the very wealthy and profitable corporations. Today’s announcement highlights how a much too cautious approach during a pandemic has further harmed Black, brown, immigrant, LGBTQ, and white low-income people while leaving our state with restricted funding to address increasing costs for vital programs that would lift up all Virginians. A significant portion of the revenue surplus is required to be deposited into Virginia’s reserve funds and water quality funds, even as working families across Virginia continue to navigate a myriad of challenges ranging from looming evictions to lack of affordable, quality health care.
State lawmakers have an opportunity to raise the resources we need to invest in all of us. By fixing our state’s upside-down tax code, which currently has people with taxable incomes above $17,000 a year in the same income tax bracket as millionaires, we can build a stronger Virginia. Making sure that the wealthy and large corporations that have benefitted from this system pay their fair share benefits all of us, especially as we continue to recover from the COVID-19 pandemic and work to address Virginia’s legacy of racism and discrimination. Lawmakers should boldly act to advance tax fairness so that we can invest in our schools, in our environment, and in our communities.
- The Commonwealth Institute for Fiscal Analysis
- New Virginia Majority
- Virginia Organizing
- Voices for Virginia’s Children
- Thomas Calhoun, president of Norfolk American Federation of Teachers
- Virginia Retired Teachers Association
- Richmond Region LULAC
- Washington County Independent Neighbors