Virginia Sets Example for Cash-strapped States
Gov. Bob McDonnell announced that Virginia ended the fiscal year with a $311 million surplus yesterday. And for the second year in a row, Virginia ends the fiscal year with a revenue surplus, not a revenue shortfall. This is great news for Commonwealth residents, and it puts Virginia sharply in contrast with many other states that have seen revenues fall short of projections year after year.
Virginia's revenues are ahead of the forecast for two reasons: economic growth and conservative projections. The Commonwealth has avoided the temptation to which so many other states have succumbed to use fanciful revenue projections to ostensibly balance their budgets. Virginia can truly say it has a balanced budget because it has the numbers to prove it.
Finally, the governor is to be commended for using part of the surplus to help shore up the Commonwealth's public employee retirement funds. While in better condition than many other states, Virginia's retirement funds are not fully funded. Making up that difference now rather than in later years ensures fairness for public employees, retirees, and taxpayers.