The Virginia General Assembly will return to session Wednesday with key issues already on the docket for the newly Democrat-controlled legislature, including a two-year budget for the Commonwealth and a fight over a new sports facility in Alexandria.
The possible future home of the Washington Wizards and Washington Capitals is seeking nearly $1.5 billion in state-provided bonds. For those funds to come through, the legislature would need to approve and create a state sports authority that would issue the two bonds needed to cover the costs.
That debt would ultimately be paid by tax revenue gathered at the venue, as well as lease payments from Monumental Sports and Entertainment.
Many Republican legislators, who over the past two years have generally been aligned with Republican Gov. Glenn Youngkin’s agenda, say they to hear more about the specifics and possible benefits of the deal, The Associated Press reported. While top Democratic lawmakers have generally signaled they’re open to supporting the project, its approval is far from certain.
State Sen. Scott Surovell, the incoming Virginia Senate majority leader, called it “a very interesting opportunity for Virginia,” last month.
Surovell has said the project seems to have merit but that lawmakers will have a long list of questions, according to The Associated Press. Incoming Democratic House Speaker Don Scott told the AP has was “optimistically cynical” about the plan’s future.
Some members of the state Senate have already voiced resistance to any state funding for the project.
“Anyone who thinks I am going to approve an arena in Northern Virginia using state tax dollars before we deliver on toll relief and for public schools in Hampton Roads must think I have dumbass written on my forehead,” President Pro Tempore of the Senate L. Louise Lucas wrote on X in late December.
Around 5% of the $2 billion project will be fronted directly by the the city of Alexandria.
Virginia is the nation’s most populous state without a major pro-sports franchise, something government officials of both parties over the course of decades have sought to change.
The budget
While Monumental’s arena is expected to bring fierce negotiations, the Commonwealth must also pass a two-year budget.
With narrow control of both chambers in Democrats’ hands and a Republican occupying the governor’s mansion, compromise will need to happen before the end of the 60-day session.
In December, Gov. Glenn Youngkin proposed a new tax structure to fund the next two years. His proposal included cutting the state income tax by 12% across the board. The lowest tax bracket of 2% would decrease to 1.75%, and the top bracket would drop from 5.75% to 5.1%.
At the time, Youngkin pointed to states further south with lower state taxes, saying they were more attractive to residents: “Americans and Virginians were choosing to go there instead of here. Each of these states had lower taxes or had started their journey to lower taxes.”
To offset the fall in revenue, his plan would call for raising the state sales tax by 0.9%. It would also enhance the earned income tax credit for low-income Virginians.
Democrats responded to the plan, calling it regressive and favorable to the wealthy.
“By lowering taxes for the wealthiest Virginians and raising local and state sales tax, the burden is shifted onto those least able to afford it,” said incoming House Speaker Don Scott at the time of the announcement.
The “Unleashing Opportunity” budget from Youngkin also includes $24 billion investment in Virginia’s public schools and $138 million for mental health initiatives, including increasing mobile crisis units and student mental health services.
The Democratic Caucus have called the proposal a “slap in the face of our most vulnerable individuals.”
Democrats have expressed other key legislative goals for the 2024 session, including raising the minimum wage to $15 by Jan. 1, 2026, and creating a constitutional amendment to allow abortion access in the Commonwealth.
The Associated Press contributed to this report.
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