House Democrats dropped a budget proposal Friday morning and seemed hopeful that Senate Democrats would be amenable.
The biggest sticking point throughout this entire debate has been data center tax breaks. Senate Democrats want to end the tax breaks, while House Democrats want to stick to their past promises to keep them in place through 2035.
Speaker of the House Don Scott, D-Portsmouth, pointed out that he was not in the General Assembly when legislators voted to extend the tax breaks in 2016.
Ironically, the loudest voice for removing the tax breaks, Sen. Louise Lucas, D-Portsmouth, voted in favor of the relief for data centers back in 2016. Lucas voted in support of the bill in the Senate Appropriations Committee and during the full-floor vote. As did every other member of the Senate.
97 members of the House also voted to extend the tax breaks to 2035.
Former Gov. Terry McAuliffe tried to amend the bill to change the end date to 2028, but the General Assembly rejected his proposal.
“They all voted for it. I wasn’t here,” Scott said Friday.
Senate Majority Leader Scott Surovell, D-Fairfax, who was in the Senate in 2016, pointed out Friday that when the legislation passed, it was projected to cost $56 million. Opponents of the data center tax breaks now say they cost $2 billion, as Virginia has become the data center capital of the world.
House Democrats are proposing in the budget to create a commission to study data centers and present a report to the General Assembly on Nov. 1.
Scott said this would give legislators a chance in 2027, or earlier if the governor calls a special session, so the General Assembly “can pass real lasting reforms.”
Scott also reiterated that this is a proposal, and he hopes the Senate and House budget negotiators will come together to wrap this up.
“It’s never take it or leave it. We have too much respect for the Senate,” Scott said. “We’ve put forth our best offer. This is a proposal for a conference report.”
House Appropriations Chair Luke Torian, D-Prince William, also maintained an optimistic tone about moving forward.
“It is my great hope that the Senate will take a look at the work that we’ve done, and that we can partner together to get this done for Virginia,” Torian said Friday.
As Virginia Scope reported Thursday, Gov. Abigail Spanberger is backing the House budget proposal.
She released a statement Friday afternoon officially announcing her support.
“Today, the House of Delegates put forward a substantive, specific budget proposal to deliver on so many priorities Virginians share. I appreciate Speaker Don Scott, Appropriations Chairman Luke Torian, and the members of the House who came to the table in good faith to make it happen. It is a proposal I am proud to support,” Spanberger said.
Lucas did not immediately respond to a request for comment on Friday.
On the House budget proposal, Senate Majority Leader Scott Surovell says, “It's a good first step but we have a ways to go and we look forward to continuing the dialogue with them to ensure we have a budget to put on the governor's desk by June 22.”
— Tyler Englander (@TylerEnglander) June 12, 2026
Lawmakers have until 11:59 p.m. on June 30 to reach a deal before the state government shuts down.