The Governor prepares the budget in the form of a bill, and identical versions of the Governor’s Budget are introduced into the House of Delegates and the Senate of Virginia. Each bill is passed by their house of origin and communicated to the other body. The Senate will refer the House bill to the Senate Finance Committee, then report it out of committee with amendments. The House bill will then advance through the rest of the legislative process. The Senate bill is “left in” the House Appropriations committee with no further action.
For budgeting purposes, state revenues are divided into two broad types: (1) the general fund and (2) non-general funds. General funds are mostly derived from taxes and fees and used for a variety of purposes and are the funds that the Governor and the General Assembly have the most discretion to spend. Non-general funds come from specific federal grants or student tuition and are earmarked to fund specifically, i.e, higher education, etc..
Every even year, i.e, 2014, a 2 year (biennium) budget is passed that is effective in that same calendar year beginning on July 1 (start of fiscal year) and ends June, 30 (end of fiscal year) but that budget applies to 2 consecutive fiscal years, i.e., 2014 - 2015 and 2015 to 2016.
In an even session year, i.e., 2014, the 2 year biennium budget is introduced along with a smaller bill, often called the “caboose” bill that are amendments to the previous biennium budget. They are amendments that are necessary because predictions of revenues can fall short or be more than what actually occurred. The “caboose” bill allows for adjustments to appropriations on the previous biennium budget.
The budget in the odd year is created to simply amend the bill that was passed in the even year. By the time the biennium budget goes into effect in July of even year that it passes, the Governor notifies each state agency of its “current services” spending target. Agencies are allowed to submit addenda requests in the early fall for priorities which could not be afforded within this assigned target. In the next, odd year session the Governor will then submit another budget that will amend the existing biennium budget.
The Budget is organized in 4 parts:
Part 1 – Operating Expenses - Itemizes the dollar amounts that are appropriated to state agencies. Legislative, Judicial, Executive (by Secretarial Area), Central Appropriations, Independent Agencies, and State Grants to Nonstate Entities.
Part 2 – Capital Project Expenses - Itemizes the dollar amounts appropriated for one-time costs of building, improving, or repairing government facilities. Listed by department, then by alphabetical order of the agency. Only agencies for which funds have been appropriated for capital projects will be displayed.
Part 3 – Miscellaneous - Sets forth actions affecting state debt, various revenue transactions, and interfund transfers. Transfers from various non-general funds to the general fund; sets forth lines of credit to various departments; and details specific types of taxes and fees.
Part 4 – General Provisions - Sets forth general operating policies. Operating policies that govern the generation of state revenues and disbursement of appropriations, i.e, prerequisites for payment, etc...
Members of the House and Senate may submit requests to amend the Governor’s introduced budget. Every member who submits a budget amendment is given the opportunity to speak to his or her request before a committee or subcommittee. Once the budget is enrolled and submitted to the Governor, he may approve the budget, as amended by the bodies, or he can submit a final round of amendments (often they are referred to as recommendations). The House and Senate will approve or reject those final Governor's amendments.
See Budget Amendment Navigation, above.
The House Appropriations Committee (HAC) and Senate Finance Committee (SFC) staff perform critical analysis of all areas of the budget process in a given budget year . These committees are each broken into subcommittees that assist covering budget analysis of all areas of the Legislative, Judicial and Executive branches of state government, their agencies and independent agencies. Reports provided cover specific areas depending on the budget year:
These reports further clarify actions and activity that occur in given biennium budget.