RICHMOND (AP) - Gov. Terry McAuliffe laid out Virginia's fiscal outlook Friday in remarks to the General Assembly's finance committees. The Commonwealth is facing an increased budget shortfall of nearly $2.4 billion.
"If we work together, the jobs we create will not be Democratic or Republican jobs. They will be Virginia jobs."— Terry McAuliffe (@GovernorVA) August 15, 2014
The meeting came as the state prepares to make potentially deeper revenue cuts than the $1.5 billion already earmarked in the current two-year budget.
Virginia ended fiscal 2014 with a $438.5 million shortfall, a 1.6 percent drop from the year before.
The state already has taken measures to narrow the budget gap, meaning Virginia must deal with a shortfall of about $882 million in the fiscal 2015 and 2016 budget that began July 1.
Across-the-board or targeted cuts will be announced in the coming months.
McAuliffe says that will require a "series of hard decisions" that will test the state's ability to protect core priorities while balancing the budget. He also said the state must take further steps to diversify its economy.
He said, "As a direct result of the deep cuts in federal spending, Virginia’s general fund revenue collections have been abnormally sluggish, particularly considering that nationally we are well into the expansionary phase of this economic cycle."
McAuliffe recently met with lawmakers and business leaders to review the state's revenue forecast.
Americans for Prosperity Virginia State Director Sean Lansing responded, "(Gov. McAuliffe) would be wise to rethink his health care policies that will no doubt cripple future state budgets. Medicaid is a broken and failed program that has consistently experienced cost overruns while delivering shockingly poor health outcomes for its enrollees. Medicaid expansion could push the state even further into the red and jeopardize funding for other important government services, force the state to raise taxes, or both. “Medicaid is also a major driver of our enormous national debt. With the Commonwealth already $2.4 billion in the hole, it makes absolutely no sense to expand a massive, subpar entitlement program that is supposedly bankrolled by a federal government that is already $17 trillion in debt. “It has become painfully clear that should Governor McAuliffe act to unilaterally expand Medicaid against the wishes of his constituents, the General Assembly and the law, he will be doing so on political grounds instead of in the best interests of Virginia.”