by Jesse Lynch

As of August 2021, Terry McAuliffe has released over eighteen plans for his second term as Governor of Virginia. The policy proposals oscillate between highly specific and indefinitely vague. This report attempts to forecast five of these proposals: education, economics, entrepreneurship, COVID-19, and healthcare. The Thomas Jefferson Institute for Public Policy has attempted to assign a fiscal impact for all the proposals using publicly available information from reports from the Department of Planning and Budget, the Virginia House and Senate Appropriation Staff, and other entities involved in the allocation and appropriation of Virginia’s Budget.

Our budget projections are based on current spending, excluding the American Rescue Plan Act funding. According to our analysis, a McAuliffe budget would have the following significant effects:

• Virginia’s Operating Budget spending would increase by $8,312,224,332 over the biennium. The General Fund would increase by $7,634,029,721, and the Non-General Fund (NGF) would increase by $678,194,611 (See Table 2).
• McAuliffe’s proposals would represent an increase of 5.99% to the 2022-23 Operating Budget in new proposals.
• The costliest proposed policy would be allowing Virginia’s state government employees to engage in collective bargaining, which would cost the Commonwealth more than $1,874,965,290.

McAuliffe proposes leveraging and drawing down federal dollars to pay for his proposed policies. When this information was publicly available, savings to the General and Non-General Fund were assessed. McAuliffe has not proposed a new revenue source, whether taxes or debt.

According to our calculations, if fully implemented, these five plans would mainly consist of spending, which would continue to be incurred after McAuliffe’s second term in office would end. New spending, which would come as one-time expenditures, would be related to COVID-19 (vaccination efforts, contact tracing, and pharmaceutical manufacturing), fully funding some of the 2019 Proposed Standards of Quality, and community colleges.

Several of the proposed policies will increase after McAuliffe leaves office including the accelerated minimum wage, increased spending for homecare workers, state employee collective bargaining, and the expansion of the Medicaid Buy-In program will become mandatory spending for the succeeding Governor.

As a result of required local contributions for teachers and other state-supported local employees, local government spending would surely increase if McAuliffe successfully implemented his public policy positions. However, our analysis is focused on state-level spending.

We attempt to state all the specifics of our analysis and calculations. While every dollar may not be exact, it represents the only attempt we are aware of to date to assign a budgetary impact of the long list of policies proposed by candidate McAuliffe. We have not assessed the economic impacts of the proposals and their effectiveness, nor do we offer an opinion on the correctness of his proposals. We have diligently attempted to avoid double counting proposals that were similar. We only offer the first attempt to understand the increased spending that Terry McAuliffe is proposing.

Jesse Lynch is a political and public policy professional with experience in Virginia’s General Assembly. He is not affiliated with the Glenn Youngkin or Terry McAuliffe campaign but is involved in a paid capacity with Republican members of Virginia’s General Assembly. He is a Radford University graduated, residing in Charlottesville.

This column has been extracted from a larger document, “A Fiscal Analysis of Proposed Policies by Terry McAuliffe.”