RICHMOND-- The Virginia Senate passed a two-year, $85 billion budget Wednesday afternoon.
In addition, the Assembly accepted Gov. Bob McDonnell's amendments to bills making sweeping changes to the public employee pension system.
The Senate and the House of Delegates also approved the governor's proposal to allow cities, counties and towns five years to phase in 5 percent pay raises that teachers and local employees will have to contribute to the underfunded Virginia Retirement System. City and county leaders had asked for the amendment because they were concerned that a large, immediate increase in payroll expenses would force them to raise taxes or cut services.
Both chambers also accepted McDonnell's mostly technical changes to a bill that scales back retirement benefits of public employees with less than five years in the system.
The General Assembly rejected Gov. Bob McDonnell's plan to enhance incentives for shippers using the Port of Virginia.
McDonnell amended two bills to establish an 'Economic and Infrastructure Development Zone' allowing corporate income tax credits to companies that use the port. Those amendments were up for consideration at the General Assembly's one-day reconvened session Wednesday.
In the House of Delegates, Speaker Bill Howell ruled the amendment was improper because it created an entire new code section. The Senate overwhelmingly rejected the amendment after the sponsor of the original bill, Sen. Frank Wagner of Virginia Beach, said he would prefer to come back next year with a program offering grants instead of tax credits.
