eNews – February 11, 2025
Reasons for budget optimism and an item of concern, Updates on legislation affecting localities...and more!
Tuesday, February 11, 2025/Categories: eNews
This edition of eNews is sponsored by GovDeals, a complete and sustainable solution specifically created for, and dedicated to, government agencies and their surplus disposition. Learn more >.
In this issue:
Budget & Finance
General Laws
Health & Human Services
Education
Elections
Opportunities
Budget & Finance
House and Senate set to announce budget conferees
Very soon, a select group of Delegates and Senators will be appointed to serve on the Conference Committee to HB1600, also known as the state budget. This handful of lawmakers will roll up their sleeves along with their respected fiscal staffs to begin to hash out any remaining issues between the House and Senate budgets.
As we have pointed out previously, major differences between the House and Senate budget amendments are hard to find this year. That should grease the skids for the General Assembly’s on-time departure on Saturday, February 22, but it won’t be over until the final handshakes are made next week.
That doesn’t mean there aren’t differences – there’s a glaring one related to CSA funding that’s highlighted in the below article – but there are numerous similarities, many that are in sync with VML’s priorities and deserving of a shout out (also included below).
VML Contact: Joe Flores, jflores@vml.org
Reasons for budget optimism plus an item of concern
Good news for localities in the budget
We are especially grateful for the following investments made in the House and Senate budgets and hope these proposals will survive in the final budget agreement. Those items include:
- $223 million to eliminate the support cap for local school divisions, a Great Recession era budget cut that is finally removed in each budget proposal;
- $53 million to provide additional supports for special education;
- Between $134 million and $141 million for a one-time bonus of $1,000 for teachers and support staff, including no local contributions; and
- Between $40 million and $50 million for the Stormwater Local Assistance Fund (SLAF)
Item of concern: Cap on reimbursements for special education private day services under the CSA
While there’s a lot of good stuff in these budgets to appreciate, there are few things that should raise some red flags for local governments. Foremost among these is that the Senate budget did not remove language that caps state reimbursement for special education private day services under the Children’s Services Act (CSA) if the cost of those services would exceed 2.5 percent from the previous year.
The House budget (Item 268#1) removed that language from the Governor’s introduced budget. As noted, however, the Senate budget retains this language which puts localities at risk of having to pick up some costs currently paid for by the state.
VML supports the House action on this issue and urges you to talk to your members of the House Appropriations and Senate Finance & Appropriations Committee to support this House amendment during the upcoming budget conference deliberations.
Some facts about CSA:
- The CSA program, begun in the early 1990s, is a shared state and local responsibility. Cities and counties administer the program on the state’s behalf.
- Individualized education plans (IEPs) that govern special education services, including private day services, must be adhered to in accordance with federal laws.
- Local CSA teams do not create and cannot change an IEP; if a child’s IEP calls for special education private day services, it must happen.
- Capping the state’s commitment to CSA would constitute a major departure from the foundation of this program by shifting part of the state’s funding responsibility onto local governments (estimated at $9.89 million in FY2026).
- This cap on state reimbursement would potentially affect every city and county in the Commonwealth.
VML Contacts: Joe Flores, jflores@vml.org; Janet Areson, jareson@vml.org
Bill with potential negative impact on local finances sent to study
One of the remaining bills that VML spent considerable time working on this session was converted to a study this morning by the Senate Finance and Appropriations Committee (SFAC). That’s the best outcome we could have hoped for.
HB1743 (Watts) proposed to expand BPOL licensing tax deductions for businesses operating in other states. Under current law, any receipts attributable to business conducted in another state or foreign country in which the taxpayer is liable for an income or other tax based upon income are deductible from gross receipts or gross purchases for license tax purposes.
The bill proposed to expand the definition of “income or other tax based upon income” to mean “net income tax, as defined in 15 U.S.C. § 383, or any other tax the measure of which is based in whole or in part on gross or net income, or receipts.”
The change was likely to decrease BPOL tax revenues, but by exactly how much it would have done so was unclear.
Rather than proceeding with this change, SFAC asked the Department of Taxation to convene a work group that includes VML, the Virginia Association of Counties (VACo), and the Commissioners of Revenue as well as the Chamber of Commerce and other key business representatives. These groups are tasked with reviewing:
- The current policy and methodology of out of state deductions.
- Any concerns regarding the existing laws governing these deductions.
- The potential impact of proposed changes, including potential revenue impacts to localities, potential administrative complexities, and potential complexities to taxpayers.
- Any impact to such deductions from other existing provisions of law.
VML Contact: Joe Flores, jflores@vml.org
General Laws
Bills that have passed the Senate Local Government Committee
HB1601 (Thomas) Siting of data centers; site assessment; high energy use facility – Defines “high energy use facility” and requires that an applicant to build one perform a site assessment; but nothing shall be construed to supersede existing local zoning authority.
HB1659 (Henson) Local Foundation and Soil Management Fund – Authorizes a locality to create a local Foundation and Soil Management Fund.
HB1827 (Simonds) Comprehensive plan; social determinants of health – Encourages the inclusion of data and research related to social determinants of health in the comprehensive plan to consider how the plan will impact the locality’s public health and access to health care services.
HB1996 (Bennett-Parker) Planning and zoning; public notice – Requires the 2nd public hearing notice that a planning commission or a local governing body publishes for certain planning and zoning actions to be published no less than 5 days before the date of the meeting.
HB2330 (Hodges) Notice of certain land use actions – Provides that one notice sent by first-class mail to the last known address of certain property owners impacted by a zoning change of 25 or fewer parcels shall be deemed adequate notice provided that a member of the local planning commission file an affidavit of the mailings.
HB2037 (Bulova) Land development; solar canopies in parking areas – Allows localities to include a provision in its ordinance to require a solar canopy over designated surface parking areas.
HB2054 (Reaser) Affordable housing; application for special use permit for assisted living facilities – Allows localities with an affordable housing program to negotiate affordable rental units in assisted living facilities.
HB2128 (Walker) Derelict buildings; civil penalties – Expands authority of locals to impose civil penalties on owners of certain derelict buildings to include non-residential property.
HB2533 (Sewell) Counties, cities, and towns; comprehensive plan may include use of accessory dwelling units – Localities may include accessory dwelling units in their comprehensive plans.
HB2628 (Glass) Local officers; oath of office – Requires local officials to take the oath of office prior to the beginning of their term.
HB2660 (Simon) Subdivision ordinance; shortens timeframe for local approvals – Shortens the timeframes for various local government approvals of subdivision plats and site plans. Also creates a work group to review these processes with the Code Commission over the summer and report back by November 1, 2025.
Charter bills
HB2005 (McNamara) Roanoke, City of; amending charter, appointment of director of real estate
HB1971 (Marshall) Danville, City of; new charter (previous charter repealed)
HB1634 (Hayes) Charter; City of Portsmouth
HB1645 (Hayes) Charter; City of Chesapeake
HB1669 (Wright) Brodnax; Town of; amending charter, election of mayor
HB1677 (Phillips) Charter; City of Martinsville
HB1687 (Convirs-Fowler) Charter; City of Virginia Beach
HB1696 (Askew) Charter; City of Norfolk
HB2019 (Gilbert) Charter, Town of Shenandoah; new charter
HB2092 (Austin) Buchanan, Town of; amending charter, town elections, etc.
HB2199 (Morefield) Richlands, Town of; amending charter, relates to ordinance
HB2332 (Hodges) Urbanna, Town of; amending charter, mayor shall be a member of town council
HB2352 (Mundon King) Dumfries, Town of; amending charter, town powers, etc.
HB2760 (Wyatt) Charter; Town of Ashland
VML Contact: Michelle Gowdy, mgowdy@vml.org
Health & Human Services
Recovery residences – certification and workgroup bill reported from subcommittee
A House Health and Human Services subcommittee voted unanimously on Feb. 11 to recommend for reporting SB838 (VanValkenburg). VML supports the bill.
This bill would change the existing civil penalties for violations of law regarding operation of recovery residences. It authorizes the Department of Behavioral Health and Developmental Services (DBHDS) to issue provisional certification to certain recovery residences. It directs the Secretary of Health and Human Resources to convene a work group to (i) make recommendations related to oversight and transparency for recovery residences and (ii) develop credentialing guidelines for recovery residences. Members of the workgroup would include many stakeholders, including localities. The workgroup’s findings and recommendations would be due to the General Assembly by Nov. 1, 2025.
If reported by the full committee on Thursday, the bill will be referred to the House Appropriations Committee.
VML Contact: Janet Areson, jareson@vml.org
Education
Updates on education legislation of importance to localities
SB1307 (McPike) would allow any county or city to impose a sales and use tax if approved by a voter referendum of up to one percent dedicated solely to school construction, renovation, and debt services. This version also stipulates that funds cannot be subsidized. This is a priority bill for VML.
SB1307 passed the House Finance Committee 13-7
HB1954 (Rasoul) would establish the At-Risk Program to support programs and services for educationally at-risk students including prevention, intervention, or remediation. Services would include teacher recruitment efforts, English language learner programs, and hiring additional support staff. This bill also outlines certain funding requirements for the program. This includes various recommendations from the 2023 JLARC report regarding the SOQ.
HB1954 was passed by indefinitely in the Senate Finance and Appropriations Committee since most elements of the bill were addressed in the budget.
VML Contact: Josette Bulova, jbulova@vml.org
Elections
Status updates on elections legislation affecting localities
SB1009 (Salim) would allow local elections to be conducted by rank-choice voting. The State Board of Elections would be required to create standards and approve tabulation software on existing systems conducting rank choice voting elections as well as provide voter education materials on ranked choice.
SB1009 was reported from the House Privileges and Elections Election Administration Subcommittee with substitute 5-3.
HB1794 (Helmer) would move all primary elections to be held on the presidential primary date. Concerning candidates for election in November of a presidential election year, the bill would lift the requirement that petition signatures must be collected after January 1.
HB1794 reported from Senate Privileges and Elections 12-3.
HB1938 (Reid) as amended would maintain the 40-foot prohibited area around polling places, electoral board meetings, and recount locations with an additional requirement of a five-foot prohibition around vehicles. NOTE: Thank you to everyone who submitted feedback on the issue!
HB1938 was passed by indefinitely 15-0 in senate privileges and elections.
VML Contact: Josette Bulova, jbulova@vml.org
Opportunities
Free in-person event: Municipal Autonomous Vehicle Forum happening Friday, March 14
VML Community Business Member MITRE Corporation welcomes all VML members to participate in this municipally-focused laboratory tour of MITRE ‘s extensive transportation and AI facilities, followed by a deep dive discussion into the future of municipal autonomous vehicle policies and planning.
Where: This event will be held at MITRE’s headquarters at 7515 Colshire Drive, Mclean, VA 22012.
Date: Friday, March 14
Time: 9:30 a.m. - 12:30 p.m.
Register here >.
Note: There is no cost to attend, but registration is required.
What to expect:
Several of the nation’s leading experts on autonomous vehicles and infrastructure will participate in a panel discussion and roundtable with VML members. The discussion will include lessons learned, an exploration of the Commonwealth’s ongoing work with MITRE, and discussion of ongoing and future work with local governments and states around the country, including an upcoming Autonomy Blueprint for a VML member city.
About MITRE:
MITRE is the nation’s leading not-for-profit operator of Federally Funded Research Centers. Chartered by Congress in 1958, MITRE works in the public interest across various domains, including transportation, environment, cybersecurity, healthcare, and more, providing technical expertise and guidance to the U.S. government, as well as states and municipalities and international partners. In 2025, VML and MITRE are embarking on a research partnership to bring customized and specific technical expertise to VML members.
Contact: Jon Desenberg, State and Local Director, MITRE Labs, JDesenberg@mitre.org