RICHMOND, Va. — On Monday, Republican Governor Glenn Youngkin expressed his intention to significantly enhance Virginia’s rainy-day fund by $300 million. This move is in response to the economic uncertainties linked to the federal job restructuring initiated by the White House, which is causing ripples within the state’s workforce.
During a press conference, Governor Youngkin revealed over 200 proposed amendments to a bipartisan budget approved by the Virginia General Assembly last month. The amendments aim at reducing state expenditures to funnel additional resources into Virginia’s savings. The proposed $300 million addition will supplement the existing plan to reserve nearly $295 million over the coming biennium, with the total anticipated reserve reaching $5 billion.
Youngkin emphasized that this financial buffer would equip Virginia to effectively manage any potential economic hiccups. He stated, “It enables us to feel confident that if there is a bump in the road, we can deal with it.”
This announcement follows a surge of unemployment claims from approximately 1,000 federal employees and contractors in Virginia since late January, following job and program cuts by decisions from President Donald Trump and advisor Elon Musk. In response to these job losses, Youngkin’s administration has launched a job portal and is motivating affected workers to seek alternative employment within the state.
Addressing the ongoing changes in Washington, Youngkin remarked that although President Trump has openly acknowledged the possibility of short-term economic disturbances, the long-term prospects remain promising for Virginia. He stated, “As he resets things in Washington, I agree with him that we will have long-term opportunity, and that is going to be good for Virginia.”
Before initiating these fiscal policies, Virginia employed about 315,000 federal workers, according to the Metropolitan Washington Council of Government. Despite its recent economic growth and a steep increase in residents, the state acknowledges the need to adapt to fiscal adjustments imposed by the federal restructuring. With the Democratic-controlled legislature now in recess, some lawmakers are preparing to reassess the budget to address these financial constraints. They have planned an extension of the special session scheduled for later this year.
Following Governor Youngkin’s announcement, criticism surfaced from Democratic Virginia House Speaker Don Scott, who accused the governor of neglecting Virginians’ welfare by aligning with Trump and Musk’s strategies. Scott’s statement stressed the need for gubernatorial support for residents over external pressures.
Governor Youngkin faces a deadline to sign, veto, or suggest amendments to legislation, including the budget bill, passed by the statehouse earlier in the year. Lawmakers will review his revisions and vetoes on April 2.
In his initial budget proposal in December, Youngkin had suggested tax relief measures, including the elimination of taxes on tips and car ownership for lower- and middle-income earners. However, the Virginia House of Delegates and Senate rejected this plan and instead approved a budget offering a $200 tax rebate per taxpayer.
On Monday, Youngkin expressed support for these rebates, which had received bipartisan backing. The legislature also dismissed Youngkin’s attempt to withdraw funding from local entities that do not fully cooperate with U.S. Immigration and Customs Enforcement. Additionally, Youngkin’s initiative for a $50 million “Opportunity Scholarship” program for low-income families to utilize private education options was also rejected. Nevertheless, Youngkin reintroduced trimmed-down versions of these proposals in his budget amendments.
The governor proposed reallocating $25 million to the scholarship initiative to grant lower-income families a chance to pursue alternative educational opportunities. Youngkin posed the question, “Why not try it?”
In another amendment, Youngkin proposed considering the establishment of Oak Hill, former President James Monroe’s residence, as a state park—an initiative previously halted during the legislative session.