Governor vetoes $850M budget cuts impacting Medicaid funding and unappropriated balance

The Special Subcommittee on Federal Impacts to Resources convened on May 20, 2025, to discuss significant budgetary issues affecting Virginia's financial landscape. The meeting began with a review of the unappropriated balance from the recently adopted budget, which stood at $47 million.

During the reconvene session, the committee noted that $4 million in vetoes were sustained. Additionally, the governor vetoed a substantial $850 million, which adjusted the unappropriated balance to $905 million. However, the keeper of the rolls identified three of these vetoes as unconstitutional, with two specifically impacting Medicaid funding. This determination further reduced the unappropriated balance to $883 million.

The committee highlighted that the majority of this $883 million consists of one-time resources derived from the fiscal year 2025 surplus, along with a withdrawal of $1 billion from the revenue reserve fund. It was also noted that the first-year funding primarily focused on capital projects, totaling approximately $691 million.

The meeting concluded with an invitation for questions regarding tax policy, indicating a willingness to engage further on fiscal matters. The discussions underscored the complexities of budget management and the implications of vetoes on state funding, particularly in critical areas such as healthcare.