No Pay Raises, Hiring Freeze to Cover Virginia's $1.5 Billion Budget Shortfall

RICHMOND, VA — Balancing Virginia's budget, in stark terms, means no pay raises for state employees and teachers, Gov. Terry McAuliffe said Thursday.

With the state is facing a $1.5 billion budget shortfall, McAuliffe is asking government agencies across the state to trim their spending.

The governor insists localities will not be overly burdened.

"There will be no program cuts to public education, Medicaid for our families most in need, nor our core public safety services," he said in a statement. "We did not kick our budget problems to local governments by reducing payments to cities, counties or towns.

"These are obviously difficult decisions to make and there may be more to come. . ."

Total general fund revenues rose by 1.7 percent in fiscal year 2016, for a total of $18 billion but fell short of the official forecast of 3.2 percent growth by $268.9 million, according to the governor's office. Most of the shortfall was due to withholding and sales tax collections.

Transfers to the general fund fell $10.4 million short of the forecast. The combined shortfall including general fund revenue and transfers in fiscal year 2016 totaled $279.3 million.

All of which means no raises for state employees or teachers, delays in filling open positions across many state agencies and 26 layoffs.

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