Virginia General Assembly Budget Talks Stall Amid Partisan Divisions

Disagreements over tax exemptions for data centers threaten to delay budget passage before legislative session ends

Published on Mar. 10, 2026

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The Democratic-controlled Virginia General Assembly is facing challenges in passing a budget for the next two fiscal years, with budget conferees from the House and Senate yet to meet and negotiate a compromise. The main sticking point appears to be a disagreement over whether to end a sales tax exemption for data centers, which was included in the Senate-passed budget but not the House version. Legislative leaders from both parties have expressed concerns that the budget may not be passed before the scheduled end of the legislative session on Saturday.

Why it matters

The inability to pass a budget on time could lead to a government shutdown or a lapse in funding for state services and programs. The debate over the data center tax exemption also highlights the ongoing tensions between the state's efforts to attract and retain technology companies and concerns about the fairness of the tax system.

The details

House Appropriations Committee Chair Luke Torian (D-Prince William) and Senate Finance and Appropriations Committee Chair Louise Lucas (D-Portsmouth) have both acknowledged that budget negotiations are moving slowly. Torian said the budget conferees, who are responsible for negotiating a compromise, have not yet met, despite the legislative session being scheduled to end on Saturday. The main difference between the House and Senate-passed budgets is the Senate's proposal to eliminate the sales tax exemption for data centers, which was not included in the House version.

  • The 2026 Virginia General Assembly Session is scheduled to end on Saturday, March 16, 2026.
  • Budget conferees from the House and Senate have not yet met to negotiate a compromise between the two chambers' budget proposals.

The players

Luke Torian

Chair of the House Appropriations Committee and a Democratic member of the Virginia House of Delegates representing Prince William County.

Louise Lucas

Chair of the Senate Finance and Appropriations Committee and a Democratic member of the Virginia Senate representing Portsmouth.

Ryan McDougle

Senate Minority Leader and a Republican member of the Virginia Senate representing Hanover County.

Abigail Spanberger

The Democratic Governor of Virginia.

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What they’re saying

“I think at some point in time we will come together and come to an agreement, a mutual agreement that all parties can live with.”

— Luke Torian, Chair, House Appropriations Committee (WRIC)

“The budget conversations are going a little bit slow right now, but guess what, we're gonna get there.”

— Louise Lucas, Chair, Senate Finance and Appropriations Committee (WRIC)

“It is looking more and more like we will not be leaving here on time on Saturday because of the disagreements in the budget.”

— Ryan McDougle, Senate Minority Leader (WRIC)

“I beg to differ with anyone who says that it's on me to meet to discuss this budget because I delivered a budget that makes life affordable by ending a tax giveaway to big tech. The Governor and Chairman Torian have drawn a red line!”

— Louise Lucas, Chair, Senate Finance and Appropriations Committee (X)

What’s next

If lawmakers do not pass a budget by Saturday, March 16, 2026, they will have to pass a budget by July 1, 2026, when the new fiscal year begins, to avoid any potential lapse in funding.

The takeaway

The inability of the Democratic-controlled Virginia General Assembly to reach a compromise on the state budget highlights the ongoing partisan divisions and the challenges of balancing the interests of different constituencies, including the technology industry and taxpayers. The outcome of these budget negotiations could have significant implications for the state's fiscal health and economic development priorities.