Gov. Glenn Youngkin (R-VA) unveiled his amendments to the state budget.
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NewsTranscript
00:00Please welcome your 74th Governor of the Commonwealth of Virginia, Governor Glenn Yunkin.
00:07Applause
00:24Welcome. Thank you. Please sit down. Thank you so much.
00:30It must be a budget discussion because the only other time there is this many people in this room is when we are signing a bill to get harmful dyes out of our kids' food.
00:44So thank you all for coming this morning.
00:47Since the General Assembly adjourned on February the 22nd, we, but I, have had the great opportunity and privilege to reviewing 916 bills that they passed
01:01and the 515 budget amendments that they adopted and sent over to me in their conference report.
01:08I'll sign most of the bills. I will amend others. And yes, I'll veto some.
01:17But as of this morning, I have already signed 365 bills and will be completing action on all of them by midnight tonight.
01:27But before we do that, right now, we are gathered to talk about the largest and most complex of those bills and the actions that we will be taking on the budget today.
01:41Today, I'm proud to present to you the amendment package to the conference report House Bill 1600, a bill that, a bill which makes amendments to our fiscal year 2025-2026 biennium budget that we have already adopted.
01:59See, this time last year, we had to go to work as well. And we stood in this very room and we presented the common ground budget.
02:08That budget took us to a good place, a place of common ground that, while I was disappointed because it removed all of the tax relief that I had introduced,
02:19it also removed the tax hike that the General Assembly Democrat leadership had proposed and made a series of modifications to maintain structural balance over the biennium and into the future.
02:34And on top of that, included substantial investments, record investments in places that we know Virginia needs to continue to lead.
02:45All of that while preserving $8 billion of tax relief for Virginia families over the two biennium that have defined our time in this administration.
02:56We delivered a record $21 billion for public education, a historic $20 billion in general funds supporting Medicaid, behavioral health, developmental disabilities, and other healthcare priorities.
03:08$5 billion to back up our law enforcement, first responders, and military heroes. $2 billion in support of record investment in job-growing infrastructure.
03:18And again, something very near and dear to my heart, the healthiest Chesapeake Bay in decades.
03:24Ultimately, the final budget we adopted in May of last year ensured that our collective priorities, our administration, and the General Assembly's priorities were well-funded.
03:36But the key to that moment was that every party around the table had to give up something.
03:45This year, with a projected $3.2 billion surplus above the baseline budget in Chapter 2, we have to take the same approach.
03:58Everyone around the table will need to take a little less than what they want, but still there is a substantial increase in so many areas.
04:11And I'm optimistic that we can, again, deliver the same positive results and the same leadership that Virginians deserve.
04:21My budget amendments and the resulting budget package reflect the following reality.
04:28Virginia has never been stronger.
04:32Strong job growth. Strong startup launches. Now over 15,000 high-growth businesses.
04:40Strong business investment. Strong population growth. A strong balance sheet.
04:48And yes, now moving into our fourth year of record surplus after surplus.
04:55That strength allows us to achieve three key objectives.
05:01Number one, to provide needed additional tax relief of a billion dollars that will bring a cumulative $9 billion of tax relief during our time together.
05:14Second, to provide incremental funding for key priorities on top of the record investment in the Common Ground budget.
05:24But not overwhelming fiscal years 27 and 28 with ongoing spending obligations.
05:35And third, to create even more reserve cushion as we recognize first the need for the moves that are being taken in Washington to restore fiscal responsibility
05:52and to the near-term uncertainty that comes with that.
05:59Our strong Virginia provides substantial tools to address every expressed risk that President Trump himself has been preparing us for.
06:11That there may be economic dislocation as he restores this fiscal responsibility so needed in Washington.
06:21We are strong. We are being dynamic in how we are managing our budget.
06:28And let me tell you, Virginia will keep winning together.
06:34Taken together, the package of amendments, 205 amendments and eight item vetoes I am offering accomplish exactly this mission.
06:48$1.1 billion in tax relief.
06:51By the way, that totals now $4,600 in tax relief during our administration for a typical Virginia family.
07:00And if that family happens to have a military retiree pension, it's $12,600 for that family during our administration.
07:12Second, we are providing substantial incremental investments in education, health care, public safety, commerce and trade,
07:21and of course preserving our God-given natural wonders.
07:25And third, we are banking a further reserve of $300 million on top of the $294 million required deposit in the revenue reserve,
07:40bringing our total to nearly $5 billion of rainy day fund cushion in case we need it.
07:48We are taking on no new debt, and we have fewer long-term spending obligations,
07:55which creates an incremental $360 million in potential reserve or tax relief for the next biennium of 2027 and 2028.
08:08Once adopted, these changes to our overall budget package are providing Virginia with a sound foundation to move forward,
08:23to address all of our biennial budget needs, to ensure that our obligations, including Medicaid, are fully funded.
08:33The key message here is that we are strong.
08:38Because of that strength, we can be dynamic, and by being dynamic, Virginia will keep winning together.
08:49Now, this approach has served us incredibly well and will continue to uphold Virginia's sterling AAA bond rating,
09:02and we have earned this from all three rating agencies.
09:08Now, to dig a little deeper in our current financial position,
09:12we remain strong financially, with state revenue running slightly ahead of plan through eight months.
09:19Virginia's strong job growth and significant investment commitments –
09:23by the way, we just ticked over $100 billion of commitments from businesses who want to expand and grow here since January 2022 –
09:32are driving job growth and revenue growth year over year, resulting again in a projected surplus for this fourth consecutive year.
09:43Since our time together, with this surplus this year, we will be at roughly $10 billion in excess revenues during this administration.
09:57We have the largest labor force in the history of the Commonwealth.
10:01We finally have turned net out-migration into net in-migration.
10:07There's 267,000 more people working today than three years ago,
10:13and we have over 250,000 open jobs for people to take in the Commonwealth,
10:21and the $100 billion of capital investment will create another 70,000 jobs.
10:28In case you hadn't heard it or didn't know it, Virginia has jobs.
10:35We continue to be confident with our fiscal year 25 and fiscal year 2026 forecasts,
10:45although I acknowledge, and let's be clear, just as President Trump has acknowledged,
10:53there is risk in financial disruption as they take the needed actions to restore fiscal discipline in Washington.
11:05Moves that we desperately need.
11:09Folks, we have a $2 trillion a year annual deficit.
11:15Our debt crisis, which is now at $37.5 trillion in debt, looms over us,
11:24and I believe is the biggest risk that we have as a nation long-term.
11:30The significant reforms under President Trump's agenda, in fact, promise long-term opportunity for the Commonwealth of Virginia.
11:40The growth in business opportunities is immense, and in areas that we have unique strengths,
11:48technology, data centers, AI, advanced manufacturing, aerospace, life sciences,
11:56in all of these areas, as companies expand here in the United States,
12:02and you have seen just a plethora of commitments to invest billions, if not trillions, into the United States,
12:10that is Virginia's opportunity to win.
12:15And I will tell you that anyone who believes that significant change doesn't come with near-term uncertainty
12:23hasn't been through significant change.
12:27In fact, our General Assembly leadership have formed two special committees to consider the potential impact of these changes.
12:35I am confident that they will agree that our amendment package that brings together tax relief
12:45for Virginians who need it, with continued record investment in critical areas,
12:53while increasing our reserves, not overburdening future years with too much program spending,
13:02and not taking on incremental debt, will, in combination, position Virginia to stand strong going forward.
13:14Once again, by depositing a discretionary $300 million in the Revenue Reserve Fund at the end of fiscal year 2026,
13:26we will bring our total for just this biennium to nearly $600 million,
13:35and our total rainy day reserves to $5 billion.
13:42Virginia is strong, and Virginia is ready.
13:49I also want to make sure that we understand that the investment priorities that we have laid out
13:55continue to be shared priorities that we know we have to invest in.
14:00Let me start with education.
14:03This budget includes $166 million more than the budget I introduced in December for public education,
14:10and it aggregates to now $450 million more than what's in the current Chapter 2 budget.
14:17We adopted Chapter 2, setting another record in investment in education at over $21 billion in direct aid,
14:26which is, by the way, a 50 percent increase over levels prior to the pandemic.
14:34And 50 percent is a big number, but $7 billion is an even more eye-catching number.
14:42The commitment that we have collectively made to K-12 education has truly been unprecedented in Virginia's history.
14:51The new money that we are including in our amendments today includes $85 million to raise the cap on non-instructional support positions,
15:00$52.8 million for enhanced special education,
15:05and $15 million, reduced from my initial ask of $25 million, for college partnership lab schools.
15:13We also are providing nearly $26 million to maintain our assessment system while the new one is being completed,
15:21$25 million to increase support for schools that are identified as off-track or need intensive support
15:28under our new school performance and support framework adopted by our Board of Education.
15:33And we've included $25 million for Virginia Opportunity Scholarships,
15:39so that 5,000 lower-income Virginians can pursue alternative education pathways.
15:47We're including an additional $50 million for school construction grants and loans above what's in Chapter 2,
15:55bringing the total for this biennium to $610 million to help our schools build and repair.
16:03The budget includes a well-deserved bonus for teachers, as well as state employees and all state-supported local employees.
16:13This builds on the 18 percent teacher pay raises that we have adopted during our administration.
16:22One area that we have collectively highlighted as being critically important
16:27is our best-in-class early childhood and education program called Building Blocks for Virginia Families.
16:35This has been an absolute bipartisan collective effort to drive forward support for working families across Virginia.
16:44Our amendment includes an increase of the copay amount up to the federal standard
16:50and an increase of $7.5 million in general funds, which is on top of the $593 million that's already in the base.
16:59Our collective actions will increase the number of available slots to 7,000 open slots,
17:07providing high-quality child care to 52,000 Virginia families.
17:13And the amazing thing is it includes the ability for those families to choose which child care is best for their family.
17:23We will create the largest number of publicly supported early childhood slots in Virginia history.
17:33With regards to higher education, after years of widespread concern about the general fund's support for higher education,
17:42the Common Ground budget provided over a billion dollars of investment in our colleges and universities.
17:50Our amendment package offers $55 million on top of the $150 million for affordable access,
17:57$15 million more for financial aid on top of the $33 million already in the base,
18:03and $15 million for critical information technology investments
18:07in order to bring standards up across a number of our institutions of higher learning.
18:13I do believe, given the incredible support from the General Assembly and our administration for affordable access,
18:21that we should cap tuition increases at our institutions of higher ed at no more than 2.5% a year
18:28in order to continue to make it affordable for Virginia families.
18:33In addition to this new funding, my amendments will direct $60 million in non-general funds sources
18:41in order to finally fully fund our commitments to our survivors, our dependents, of our military
18:50with regards to the VMESDEP educational program.
18:54We worked so hard on this over the course of the summer last year
18:59to address the shortfall in funding of this benefit that has been earned by our military heroes.
19:07And yet, there is still significant concern about the sustainability of this program
19:12and the impact on affordability for other students.
19:16And therefore, this budget amendment, which uses the Commonwealth Savers Plan,
19:23which is excess money inside 529 to fund these tuition waivers up to $60 million a year,
19:32will fully fund this program once and for all.
19:37And that is something that we must collectively do.
19:41At each of these meetings with our military heroes and their families,
19:47I am constantly reminded, reminded of the sacrifices that have been made,
19:52and reminded of our obligation to stand strong behind our promises to them.
20:02This use of the actuarial surplus that exists in the 529 plan for a now discontinued program is just common sense.
20:14It's a common sense way for us to make sure that we are able to fulfill these obligations.
20:21Our budget amendments also include significant capital investment for our institutions of higher learning,
20:28$820 million above the existing Chapter 2 investment levels.
20:37Very important investments, and I have included $80 million for the VMI Center for Leadership and Ethics,
20:45because it belongs at VMI and it should be finished.
20:50With regards to health care, the budget provides an additional $825 million for health and human resources over the biennium,
20:59bringing us to a total of $20.8 billion that we are supporting and investing in HHR over the biennium.
21:10The budget meets and clears a significant hurdle by fully funding Medicaid
21:16and all of our obligations to CHIP forecast increases with $720 million in general fund,
21:24bringing us to a total of $16 billion in general funds
21:30and $53 billion in total funds to support these Virginians who are most in need.
21:40In addition, we will provide $105 million to the Children's Services Act caseload and cost increases.
21:46In addition to that, our amendments improve on maternal health support,
21:50including my base introduced budget and the conference report,
21:54by moving maternal health mobile hub funding from the Department of Health to the Department of Medical Assistance Services,
22:04setting up a future where our managed care providers fund these supports as part of their contract,
22:10and we also restore funding for doula services at local departments.
22:16Finally, our amendments include a one-time infusion of $1.5 million in general fund
22:21to support the Department of Social Services to support security enhancements
22:25for the SNAP programs need to move to more secure EBT cards as opposed to the ones they are currently using.
22:35With regards to public safety, when adopted, my amendments will bring all-in funding for public safety
22:41to $41 million more than Chapter 2 for a total of $5.3 billion over the biennium.
22:47When compared to the biennium before I took office, this is an extraordinary increase of record proportion,
22:54highlighting the fact that our officers and sheriffs and first responders matter.
23:04We've got your back, and I want you to know that, and we're putting our money where our mouth is.
23:10This budget also includes $50 million for disaster response for relief to southwest Virginia.
23:17We've included an amendment to broaden that to include the most recent floods
23:22that once again hit Buchanan County and neighboring counties.
23:26Our amendments also provide funding for use from local governments to cover the required federal match,
23:35as well as authorize up to $2.5 million to be utilized for the much-needed improvements
23:40in public safety communication infrastructure.
23:44Our budget also includes $2 billion for the reimbursement of local law enforcement transportation
23:50for individuals who are in emergency custody or temporary detention orders,
23:55and tops up our SCOP program so that we can provide $4 million worth of these sworn law enforcement officers
24:03and hospitals so that we can allow our deputies and our police officers to get back to work
24:11when they are in custody of someone in crisis.
24:15It also restores $5.3 million on top of our roughly $45 million in the budget to school resource officers.
24:26Over our time, we will have committed $100 million to school resource officers,
24:32bringing our vision to reality that every school in Virginia should have a school safety officer or a school resource officer.
24:42Finally, our amendments on public safety restore an important condition on state funding for our localities.
24:51You must cooperate with lawful U.S. immigration and customs enforcement detainers.
24:58This is not a decision for people to make locally.
25:01This is for the betterment of all our safety.
25:05We're not a sanctuary state, and therefore we are not going to support localities that are declared sanctuary cities.
25:14Now, one of the great areas of progress over the course of our last three years together has been in economic development,
25:21and investing in business-ready sites has been a critical pillar of this.
25:25And so we are including an incremental $20 million to the highly successful business-ready sites fund
25:31to establish a base funding of $40 million a year.
25:35We're also providing $7.5 million for utility infrastructure investment in a key site in Pulaski County,
25:42and $6.5 million for bringing natural gas infrastructure to a critical site on the eastern shore.
25:49We must continue to lead.
25:52And the investments in these sites has truly translated into enormous wins for the Commonwealth.
26:00We also have to lead when it comes to space.
26:03And this budget provides $8 million in dredging at Wallops Island to support Virginia's commercial space industry.
26:10We also retain $8 million to support transformative energy and power investments,
26:16and we restore a $20 million line of credit to support runway expansion at the Roanoke-Blacksburg Regional Airport,
26:24which we know we must get going on.
26:28These amendments also include $50 million in additional non-general funds added to the Community Flood Preparedness Fund,
26:36bringing to a total of $150 million during this biennium and $478 million over the life of this fund.
26:46And finally, we are providing an additional $50 million through this whole amendment package
26:51for the City of Richmond's Combined Sewer and Overflow Project,
26:55and I think it's important for us to recognize that state funding offered to the capital of our Commonwealth
27:01for this vital effort now totals $318 million.
27:06In addition, after careful consideration, and I have to say an enormous amount of arm-twisting and a site visit with Delegate Gary Higgins,
27:17our package of budget amendments includes language to authorize the consideration of establishing Oak Hill,
27:24the historic home of Virginia Governor and 5th President of the United States, James Monroe, as a state park.
27:33Finally, my amendments restore the bipartisan priority of creating the Virginia Gaming Commission
27:41that was originally included in the House of Delegates' past version of HB 1600.
27:48Given the rapid growth of gaming around Virginia, it is imperative that we establish a consolidated, coordinated, professional oversight.
28:00It is now spread everywhere, and I have to say the incredible job that is being done at the Virginia Lottery is oftentimes unexpressed,
28:11and I want to thank you for the tremendous job you are doing leading the lottery. Thank you.
28:18This package of amendments, 205 amendments, 8-item vetoes, is in response to 515 amendments that came to me.
28:31I firmly believe that we can, with collaboration and cooperation, present Virginians a budget that accomplishes all our goals,
28:43a budget that provides substantial incremental tax relief at a time we know they need it,
28:49a budget that funds critical items but doesn't overburden the next biennium with program spending,
28:58and a budget that recognizes that while we have confidence in our forecast, that there may be risks that we have to address.
29:09And therefore, by adding an incremental $300 million of revenue reserve funding on top of the nearly $300 million already in the budget package, we are prepared.
29:24Virginia is strong, we are dynamic, and we will continue winning together.
29:30Thank you, and I will ask Secretary Cummings to go into a little more detail, although I didn't leave him much room,
29:37in the specifics of our amendment package.
29:42Thank you, Governor. You did save me some time. Thank you.
29:56So I can't help but think back to the different sessions over the course of time that we've been here,
30:03and as a point in time snapshot of where we started to now, it really is remarkable what has been accomplished
30:10in terms of prioritized spending, in terms of the changes in the environment around jobs,
30:17and the return of money to taxpayers, and the bolstering of our balance sheet.
30:22It really is remarkable, and hopefully I get that point across today to leave us in this position where we are truly strong, dynamic, and winning.
30:31So, 276,400 jobs added since January of 2022, 4.6 million jobs, the highest number of jobs ever in the Commonwealth.
30:42Number one state for business, also the number one state for sites, a new award this year,
30:48with $102 billion of announced capital coming into the Commonwealth that will generate 70,000 new jobs as those projects are completed.
30:58Super important is after more than a decade of losing families that choose to leave Virginia versus those that choose to come to Virginia from other states,
31:08we lost for 12 years straight, and this year we just turned that number positive.
31:13That's a citizens of the United States voting with their feet, and we have changed that vote.
31:20We've never been in better financial condition, consistently exceeding the prudent forecast that we have presented.
31:27Rainy day reserves at unprecedented levels, 17% of our latest revenues.
31:33We are one of the best positioned AAA rated states.
31:38There are 15 of them.
31:39We actually had a call with Moody's this past week.
31:42They're all looking at what's going on in Washington, but all would agree that Virginia stands out in terms of its conservative financial management
31:50and the current position of us prepared for what may come.
31:54Strong year-to-date results continue to say, if you just didn't listen to anything else, looked at that,
32:00you would say, wow, Virginia is continuing to do great.
32:04And the governor's amendments, which he just went through, they do provide a prudent approach to addressing the costs of our priorities,
32:13the key priorities he went through, and also increasing our cushion, our rainy day reserve fund to $5 billion.
32:22This is really important, not just in the number, 276,400 jobs that we have generated since January 2022.
32:30We are effectively competing.
32:31If you go back to when we began, we were at the bottom of this list for that year and all years prior to that.
32:38So some really amazing things have been done in this area of economic development.
32:44We all know we won the prize for number one state for business.
32:48And the key on this, I want to echo what the governor just said, was first, education.
32:53We always rank very high on that.
32:55But we're number three for infrastructure, where we've come up in the rankings,
33:00and it is the most heavily weighted category in driving the decisions of companies to come to the Commonwealth.
33:06And that was reflected in a new award, which is the number one business facility state of the year for 2024.
33:13This is the key of the vote with their feet metric.
33:17You can see what happened over the years 2014 to 2024, or 2023, where we were net negative.
33:24That's 140,000 residents on a net basis left Virginia.
33:29Very important is the line above the chart that we lost $14.3 billion of adjusted gross income
33:38with that net move of who left and who came back in.
33:41We tended to lose the higher income people.
33:44We actually brought in more of the lower end workers, lower income workers, came into Virginia.
33:5112,800 per year, and that accounts for about 1.6 billion of AGI per year.
33:58Huge economic, it's a hole in our bucket.
34:01It's a huge economic loss on our revenue base.
34:03Just think if we still had that here with all the good things we've been doing.
34:07Virginia labor force, you can see here, dramatic growth to $4.6 million, 4.6 million workers,
34:16and a participation rate that is one of the top participation rates in the country.
34:20Here's a picture of the budgets over this time frame.
34:23We all know we've had great revenue results and that the outcomes for each year have comprised of some forecast adjusting along the way
34:33and then exceeding those prudent forecasts by additional amounts, adding a surplus,
34:39and then the adjustment that we applied here in December after input from our economists and our GACR council to,
34:47once again, as shown by recent results, we have a prudent forecast which we are ahead of.
34:53This is a chart that is really stunning.
34:57Something that was developed many years ago, the progress that's been made over the last few years,
35:03but if you look at FY2022 when the governor arrived, we were at $2.6 billion and about 9%,
35:13and we have just about doubled that over the time of this administration to put ourselves in a position that is truly impressive
35:21and that helps us all sleep at night.
35:26This is, along with that, this is a comparison to the 15 states that have AAA ratings from all three major rating agencies,
35:36and you can see back in 2019, prior to the pandemic, we were near the bottom of the list at 4% of general fund expenditures,
35:47and over the time frame, most of which, as you saw in the prior chart, happened since 2022,
35:53we have now doubled, well, we have gone up to number three from 14, and we are currently at 17%.
36:02We have had the discipline in our budget to continue to put money in, some by what is required by formula,
36:09but also, as we've said in this budget, discretionary incremental amounts that will be going in, given the current situation.
36:16Fiscal year to date, results are great.
36:20Frankly, we continue to be positively surprised, not surprised, but continue to experience positive results relative to forecast.
36:30We're 6.6% up on a year-to-date basis, year over year, very impressive growth rate.
36:37And then, with respect to our forecast, which was just put in place in December, we are $187 million ahead,
36:45which gives us money in the bank to make sure that we are confident in our being able to achieve the annual number.
36:53Most important is payroll withholding, and I will add sales and use tax are both staying very strong.
37:01Those are the two most important revenue sources, and they're the best indicators on the health of our economy.
37:06So through February, you can see both of those numbers are quite strong,
37:10and this provides good confidence that we are going to meet our forecast.
37:15This is more detail behind that.
37:17What I will emphasize at the bottom of that last bullet is that we only need to grow by 0.3% year over year to achieve our forecast,
37:28and the numbers that are circled up in the chart, withholding and sales and use taxes, are most important revenue drivers.
37:35They continue to have strong immediate results in February and year-to-date at 7.1% and 2.5%.
37:44This is a versus forecast.
37:47We are ahead of projections by 1% or $187 million year to date.
37:55Employment has continued to grow 1.5% to 2% year over year.
38:01You can see on the left-hand chart that for January, we actually added 7,100 jobs.
38:07That is 40,000 over the last six months.
38:11And very importantly is the chart on the right where our unemployment rate is only 3%.
38:17We actually have the sixth lowest unemployment rate in the country.
38:22I think we all know, we hear it every day, companies still have a hard time finding people to fill their jobs, and this explains that.
38:29So we have a tight starting labor supply.
38:33We have two open jobs, as the governor mentioned, for every position unemployed.
38:38That's 259,000 companies who are looking for workers.
38:45And on the right-hand side, it shows that whereas in the U.S., we have 0.9% unemployed persons per job opening,
38:56Virginia stands at 0.5, which is 2 to 1, versus almost 1 to 1 for the nation.
39:03A lot of focus on unemployment claims, understandably, given the headlines that we see every day.
39:09This is a 15-year look at initial claims for unemployment insurance,
39:14and it shows that whereas we're watching this every time it ticks,
39:20that we're actually not in a place that it is out of place with what it has been historically,
39:26particularly as you go back pre-pandemic.
39:29We are watching this closely, as is everybody.
39:32There obviously were some recent rise in claims that got a lot of headlines,
39:37and the reality of that, as we look at very important details,
39:42is that rise in claims was completely related to private sector companies that have no dependency on federal spending.
39:50So we have not really seen this show up in our data yet, but as I said, we are watching it closely.
39:56So we are in a great position of financial strength.
40:00Three years of great revenues and a prudent budget, which has been the Virginia way.
40:05Huge investments and critical priorities.
40:08Our everyday reserve is at $5 billion, 17% up from 9% in 2022,
40:14and we have tax relief and rebates of $9 billion, as we've done all those things, over the term of Governor Youngkin.
40:22Importantly, we are now winning the war for economic growth.
40:26276,000 new jobs added since January 2022, number one state for business,
40:32and that's generated $102 billion of new investment in the Commonwealth and leading to 70,000 new jobs.
40:39That's supported also by all of the startup companies that have been created.
40:44And then the turnaround in net migration, domestic migration, and a beginning tight labor supply.
40:51So, as the Governor said, we all understand there is uncertainty out there.
40:57The President has talked about that.
40:59Secretary of Treasury has also said that.
41:01Not surprising, given the actions that need to be taken.
41:05We have things we hear from people.
41:08Our first is, are we at risk for meeting our 2025 revenue targets?
41:13As you know, as I've gone through that, we are highly confident that we are in good place.
41:18And if something happened that was completely unexpected, we have an incredibly strong reserve position.
41:25Potential federal workforce and contractor job losses.
41:28Virginia has jobs.
41:30We have incredibly tight labor supply to begin with.
41:33We have 259,000 open positions.
41:37And we have a very robust unemployment insurance trust fund standing by.
41:42It's important for everybody to understand, on federal job losses,
41:46the federal government takes care of the unemployment insurance claims.
41:49That's not going to be on the Commonwealth.
41:53And we think that the financial risks associated with potential future economic dislocation
42:00is that we have a robust pipeline of new jobs coming to Virginia.
42:05VDP is a machine that is working very, very well.
42:10The effort and coordination across all of government that is driving that is well in place,
42:16and it's showing its results.
42:18Reshoring is a real thing.
42:20Just another announcement this morning of Hyundai announcing a $20 billion investment
42:25in new facilities in the U.S., and that comes after dozens of other announcements
42:29just in the last few weeks in light of some of the coming pressures
42:34that they will face to continue to do business in the U.S.
42:39And we continue to have prudent budgeting for cushioning against potential revenue shortfalls,
42:45reducing near-term spend, the run rate of permanent spending,
42:49$5 billion in our reserves, making sure that we have positioned ourselves
42:55to not just be able to put more into the Rainy Day Fund this year,
42:59but also creating some capacity for the upcoming biennium.
43:03And importantly, in a time of higher interest rates, no new debt issuance being replaced by cash.
43:11I think the governor went through the budget amendments that he has proposed.
43:15I don't think I need to repeat that.
43:17It's right here in black-and-white detail for everybody,
43:20so I will just click through that rather than repeat.
43:29And finish with Virginia is strong, dynamic, and winning.
43:34We are strong, continuing to grow jobs, current financial results exceed our forecast,
43:39economic development has huge momentum,
43:42so many things that are in the pipeline in addition to what's already been accomplished,
43:46significant investments have been made while returning $9 billion in tax relief
43:50and Rainy Day reserves at an unprecedented and, frankly, if you go back a few years,
43:58remarkable level of cushion for the Commonwealth.
44:01We are dynamic. We understand the risks.
44:04We are watching them closely as a team, and we are well-positioned to respond to whatever may come.
44:10$3.2 billion surplus over Chapter 2 and carryover balances.
44:15We can continue to do all the things we need to do while we continue to provide tax relief
44:20and invest in our Rainy Day reserve, and we are now effectively competing.
44:25For the long term, as we go through this potential for economic impact,
44:30we have great confidence in where Virginia will be on whatever we have to go through in the next few years.
44:37So thank you. Appreciate your support.
44:47Perfect. So I want to thank everyone for attending today.
44:51The key message is very clear, that the strength of the Commonwealth today is unprecedented.
44:58We are stronger than we've ever been.
45:01We can use that strength to power forward.
45:04We are dynamic in the way we are planning.
45:07We have critical investments that we are making.
45:11We are driving those investments to very productive outcomes,
45:16and yet we are able to stash away more reserves just in case we need them.
45:24A reserve balance which is at a record level.
45:27A balance sheet that has never been stronger.
45:30A job market that has never been stronger.
45:36Companies that want to be here.
45:38Virginians that want to be here.
45:41Because we are continuing to win together.
45:46I look forward to discussing this package of amendments with the General Assembly over the coming week.
45:52I look forward to them reconvening on April 2nd and taking up our package of amendments.
45:58Most importantly, I look forward to delivering a budget to Virginians
46:04that raises people's optimism, underpins their hope,
46:10and most importantly recognizes that we win together.
46:15Now, God bless you all, and guess what time it is?
46:19Time to go to work.
46:20Okay, thank you, thank you.