State surplus Helped by Federal Funds
The Commonwealth Institute says the state surplus for FY10 was bolstered by federal stimulus funds.
The Commonwealth Institute for Fiscal Analysis says the federal stimulus helped Virginia close 16 percent of its budget shortfall, maintaining funding for crucial services during the recession and, in turn, helping to make the recent surplus possible. This money went to education, the state Medicaid budget and public safety. Virginia has received 2.5 billion dollars in federal stimulus money. Michael Cassidy, President of the Commonwealth Institute:
Cassidy: We continue to see declines in state revenue and we need at least six to eight percent revenue growth just to keep up with population growth and inflation, in terms of the cost of delivering public services to Virginians.
Virginia is set to receive an additional 250 million dollars in education assistance from the recent federal stimulus extension, as well as 400 million in the enhanced Medicaid match rate. Governor Bob McDonnell has acknowledged that federal have certainly helped the state, but says it's hard to pinpoint how much this money figured into the recent surplus. The governor will address the House and Senate money committees later this morning to give a full report on the state budget.