Gov. Glenn Youngkin urged the General Assembly on Jan. 13 to pass a package of education investments, tax relief and energy-policy changes aimed at sustaining Virginia’s economic growth and improving public safety.

The proposals include $517 million in additional direct school aid in his budget amendments, $50 million for a new Virginia Opportunity Scholarships program that would provide $5,000 scholarships for 10,000 low-income families, and a push to complete a broader redesign of the state school funding formula. Youngkin also proposed a permanent refundable tax credit to reduce the personal property (car) tax for lower-income filers and said he would fund the first three years of the car-tax credit with $1.1 billion from the state’s projected surplus.

Why it matters: Youngkin framed the measures as part of a broader agenda to keep Virginia “competing and winning,” tying school funding and workforce development to continued job growth and to the state’s ability to attract private investment.

Youngkin said his budget amendments would add $517 million in direct aid, bringing biennial K-12 funding to roughly $22.1 billion and adding $290 million for school construction. He said he had directed $1 million from previously appropriated transformation funds to produce a comprehensive modeling tool to support development of a new funding formula by this summer. “We can both invest record amounts to support an extraordinary public school system and provide students and parents pathways that work best for their families,” Youngkin said.

On scholarships and lab schools, Youngkin proposed $50 million for Opportunity Scholarships that would provide $5,000 each for 10,000 low-income families and said the scholarships “do not take a single penny away from our existing education funding.” He also praised the expansion of lab schools and renewed partnerships with historically Black colleges and universities, noting 15 lab schools in motion and the example of a student in a Future Educators Academy lab school who will earn an associate’s degree at no cost.

On taxes, Youngkin emphasized broad tax relief passed earlier in his term and pressed for additional measures, including the car-tax credit he described as a permanent refundable credit of up to $150 for individuals earning under $50,000 and up to $300 for joint filers under $100,000. He proposed using $1.1 billion of the projected surplus to fund the first three years of the credit and singled out eliminating taxes on tips as a separate proposal.

Energy and infrastructure were a major focus. Youngkin criticized the Virginia Clean Economy Act and argued that Virginia now imports roughly 40% of its power, compared with about 18% in 2020, and that imported power costs had risen sharply. He called for increased base-load capacity, saying, “We must build more natural gas generation, lots of it, build small modular reactors, and, yes, finish the projects currently underway,” and urged pursuit of carbon capture, fusion and other technologies.

On public safety and drugs, Youngkin highlighted recent interdiction efforts and proposed increasing penalties in drug-distribution cases that result in death, urging the General Assembly to raise the penalty to felony homicide in those circumstances. He described a decline in overdose deaths and praised local programs to raise fentanyl awareness. He also called for creation of a Virginia Gaming Commission to consolidate gaming oversight and proposed criminal penalties for flying drones over critical infrastructure.

Youngkin concluded by asking lawmakers to work together on these priorities during the session; his speech included multiple references to the recent water crisis in Richmond and to disaster recovery needs in Southwest Virginia. He also proposed creating a permanent disaster assistance fund for costs not covered by federal aid, private donations or insurance.

The speech was delivered to a joint assembly of the General Assembly. The governor’s proposals require legislative action; he framed several items as amendments to the budget and as standalone bills to be considered by the House and Senate.