Virginia earns B; report highlights annual deficit

Virginia earned a “B” in Truth in Accounting’s Financial State of the States report, while its main government operations posted a $472 million annual deficit in fiscal 2025. The nonprofit ranked Virginia 12th nationally, finding the state had $22.4 billion more in available assets than needed to cover obligations, including unfunded retirement benefits. In the year ended June 30, 2025, revenues were about $77.1 billion and expenses about $77.6 billion. Revenues fell roughly $1.1 billion year over year, while expenses rose about $4.4 billion, with increases tied to education, transportation, individual and family services, and the lottery. Truth in Accounting attributed part of the revenue decline to lower individual and corporate income tax receipts and higher income tax refunds.