Virginia’s budget basics
According to the National Association of State Budget Officers (NASBO), Virginia’s total expenditures in fiscal year (FY) 2022 were $74.9 billion, including general funds, other state funds, bonds, and federal funds. NASBO reported that total expenditures across all states in FY 2022 were $2.9 trillion, ranging from $5.6 billion in Wyoming to $510.0 billion in California.
Each state allocates spending and taxes differently among different levels of governments, and local governments often administer programs with state funds, so combined state and local government data show a more complete picture of individual benefits and contributions when comparing states.
Per the US Census Bureau, Virginia’s combined state and local direct general expenditures were $90.9 billion in FY 2021 (the most recent year census data were available), or $10,501 per capita. (Census data exclude “business-like” activities such as utilities and transfers between state and local governments.) National per capita direct general expenditures were $11,087.
(Note: We cite data from both NASBO and Census to provide a broader picture of each state’s fiscal situation. However, these sources detail spending from different levels of government in different years, and the COVID-19 pandemic and the federal government’s response to it significantly affected these totals in different ways in different years. Please only use one source if you are looking for historical comparisons.)
Virginia’s largest spending areas per capita were public welfare ($2,273) and elementary and secondary education ($2,210). The Census Bureau includes most Medicaid spending in public welfare but also allocates some of it to public hospitals. Per capita spending is useful for state comparisons but is an incomplete metric because it doesn’t provide any information about a state’s demographics, policy decisions, administrative procedures, or residents’ choices.
Virginia’s combined state and local general revenues were $100.6 billion in FY 2021, or $11,620 per capita. National per capita general revenues were $12,277. Virginia uses all major state and local taxes. After federal transfers, Virginia’s largest sources of per capita revenue were individual income taxes ($1,971) and property taxes ($1,914).
Governor Glenn Youngkin, a Republican, was elected in 2021 with 50 percent of the vote. The next gubernatorial election is in 2025. Virginia is the only state that does not let a sitting governor run for reelection. A governor can run for a non-consecutive second term, though.
Virginia has a divided government. Republicans control the House of Delegates, (52 Republicans to 48 Democrats) while Democrats control the Senate (21 Democrats to 18 Republicans). All Virginia House seats are on the ballot in 2023 because delegates serve two-year terms. Senators serve four-year terms, and their seats are on the ballot in 2023.
Virginia’s budget institutions, rules, and constraints
Virginia uses a biennial budget. The legislature is not required to pass a balanced budget, the governor is not required to sign one, and deficits may be carried over into the following year. However, the state has budget rules that require lawmakers to balance revenues and expenditures. Virginia does not have any tax and expenditure limits. The state does limit total authorized debt and debt service incurred by the state.
(Note: Some states have informal budget institutions that constrain overall spending growth or a specific expenditure’s growth.)
Virginia’s current budget
Virginia enacted its FY 2023-2024 biennial budget in June 2022. The enacted budget included $159.5 billion in total spending and $57.6 billion in general fund spending for the two years. Virginia also passed a major tax cut in calendar year 2022. Among other changes, the legislation repealed the state’s sales tax on grocery food.
Under the American Rescue Plan, Virginia will receive $4.3 billion in direct state fiscal aid and $2.3 billion in local government aid from the federal government. As of January 2022, Virginia had spent part of its ARP funds on refilling its unemployment insurance trust fund, capital construction, broadband expansion, economic development, and education spending.
According to NASBO, Virginia’s recent expenditure totals (general fund spending/total spending, including federal transfers) were:
- FY 2022: $24.6 billion/$74.9 billion
- FY 2021: $22.6 billion/$74.7 billion
- FY 2020: $21.9 billion/$64.2 billion
- FY 2019: $21.8 billion/$55.3 billion
For more on Virginia’s budget, see
Virginia’s economic trends
Virginia’s per capita income (per the Bureau of Economic Analysis) was $68,211 in 2022, ranking 13th among the states. It was above both the national average of $65,423 and the Southeast regional average of $56,118. The state’s median household income (five-year estimate) was $80,615 in 2021, ranking ninth among the states and above the national average of $69,021. Virginia’s poverty rate was 9.9 percent in 2021 (five-year estimate), below the national rate of 12.6 percent.
Although Virginia’s averages tell a story about the entire state, Virginia is composed of diverse localities. For example, the city of Danville’s median household income was $38,904, and its poverty rate was 23.1 percent; the city of McLean’s median household income was $242,610, and its poverty rate was 2.2 percent.
Virginia’s unemployment rate has historically been below the national average.
Unemployment rates (like other economic indicators) often vary significantly by race and ethnicity. In Virginia, the average unemployment rate in 2022 was 2.4 percent for white residents, 4.6 percent for Black residents, and 3.6 percent for Hispanic or Latino residents.