House says budget talks stalled as Senate insists on removing data‑center sales tax exemption

During the first morning hour, Delegate Tory (introduced on the floor as the delegate from Prince William) told the House that negotiators had not reached a final budget agreement because the Senate had taken the position that a budget cannot be finalized without eliminating the sales-tax exemption for data centers.

"Im sorry to report that there will be no such agreement at this time," Tory said, noting the House had produced what he described as a "strong and responsible budget" that expands support for core services and increases investments in housing, higher education and health and human services. Tory warned that removing the exemption would undermine the Commonwealth’s commitments to employers and could damage Virginia’s reputation for reliability with businesses.

Tory offered numeric figures to describe the data-center industry’s local economic footprint, saying the sector supports 74,000 jobs and generates billions in income and tax revenue (figures quoted on the floor included $5,500,000,000 in labor income and approximately $9.1 billion to Virginia’s GDP, and more than $2 billion in local tax revenue). He framed the House position as unwilling to "manufacture short-term revenue gains by putting Virginia’s long-term economic future at risk" and said the House remains ready to negotiate but cannot accept eliminating the exemption as a condition of finalizing the budget.

No immediate response from the Senate was recorded during the excerpts provided; the floor exchange ended with Tory saying the House will continue to fight for the budget it passed and the Speaker and caucuses planning to meet ahead of tomorrow’s floor session.