This story was reported and written by VPM News.
Gov.-elect Abigail Spanberger and top Virginia Democrats are aiming to lower costs through programs with little impact on the state budget, they said in a press conference Thursday.
The approach underlines that Democrats are uneasy about the commonwealth's revenue prospects, despite a rosier picture depicted by outgoing Republican Gov. Glenn Youngkin earlier this week.
"We recognize that there will be real fiscal challenges that the Commonwealth is facing, which is why many of these efforts to lower costs for Virginians either don't utilize general fund dollars or are cost neutral," Spanberger said as she announced 17 policy goals on energy, health care and housing.
"Ultimately, if we are planning for the challenges that, broadly speaking, we see on the horizon, then we'll be well positioned to contend with them," said Spanberger, when asked about Virginia's revenue outlook. "But it is even more essential, if we see economic challenges at a larger macro scale, that we are taking these actions."
Youngkin's $72 billion budget proposal, released Wednesday, forecast more revenue for the state than predictions released by state legislators.
"People need to update their models. Virginia has changed in the last four years," Youngkin told the General Assembly's finance committees. "When people say, 'Oh, you know, the federal government is going to reduce some spending and Virginia is going to get wiped out by [it].' It's just not true, and we're demonstrating that it's not true."
One of the biggest threats facing Virginians' cost of living is the expiration of expanded health care credits for those on Affordable Care Act insurance plans, also known as Obamacare. Most insurers in Virginia proposed "average increases of 20% or higher," according to a State Corporation Commission estimate from August.
One proposal Spanberger discussed Thursday is to keep targeted populations in the state's health care marketplace, aiming to lower the risk of the insurance pool at large. It was not immediately clear which demographics were under consideration.
"This program, with its targeted efforts to stabilize at least here in Virginia, the ACA marketplace, given the chaos we're seeing out of Washington, is meant to counter those efforts," she said.
A health care bill passed through the Republican-controlled US House of Representatives Wednesday, but didn't include extensions of the subsidies.
Spanberger said her incoming administration's proposal — which has not yet taken the form of legislation — wouldn't utilize Virginia's General Fund. That means it wouldn't be paid for using Virginians' income, sales or use tax funds.
The health care proposals also include realigning "management of the health incentives programs from the Virginia Department of Health to the Virginia Health Workforce Development Authority," and imposing new regulations on pharmacy benefit managers to allow for wider choice in where patients buy medicine.
On energy, two bills direct Virginia's utilities to pursue more cost-saving measures. HB2537, which received Republican support in the 2025 session but was vetoed by Youngkin, aims to push more energy storage to be built.
Another, HB2, was filed in November and requires that utility companies in Virginia expand assistance for low-income customers who are making their homes more energy-efficient.
It's not clear how much those efforts would cost consumers; much of Virginia's utility regulation law provides avenues for companies to recoup their investments from ratepayers — as evident in a recent case partially approving Dominion Energy Virginia's base-rate increase.
"We look forward to working with the new administration and legislators from both parties to promote reliable, affordable and increasingly clean energy for our customers. Along with many other stakeholders, we're carefully reviewing legislation as it's introduced, and we look forward to sharing our perspective during session," said Dominion spokesperson Aaron Ruby.
The Democrats assembled on Thursday morning also said they were targeting housing. Those measures included extending the grace period before tenants can be evicted and providing financing options for localities and developers to build affordable housing.
"We will tackle the housing crisis head on, increasing supply, driving affordability and ensuring Virginians can afford to live where they work," said Sen. Mamie Locke (D–Hampton).
House Minority Leader Terry Kilgore (R–Gate City) said Democrats are focused on the right legislative priorities — particularly housing and energy — but that Republican lawmakers have "serious concerns" about how they are being addressed.
"The housing proposals largely focus on managing existing stock rather than increasing the supply of new homes. On energy, we're concerned about policies that could saddle Virginians with tens of billions of dollars in additional costs for large-scale battery storage, costs that would ultimately be passed on to ratepayers," Kilgore said in a statement.
"If you don't build enough houses, housing gets expensive. If you don't produce enough energy, energy gets expensive. If demand rises faster than supply, prices go up. No legislation can repeal the law of supply and demand."
Patrick Larsen contributed reporting.
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