Virginia budget funds Richmond water projects and Coliseum demolition
Add Axios as your preferred source to
see more of our stories on Google.

The Coliseum has been shuttered since 2019. Photo: Courtesy of the Virginia Mercury
Virginia lawmakers passed a budget on Monday that would send millions of dollars to Richmond's water system, fund demolition of the Richmond Coliseum and give local voters another way to pay for school construction.
Why it matters: The agreement — which Gov. Abigail Spanberger still has to sign — ends a monthslong budget standoff over data center tax breaks that could have sent the state into a shutdown if lawmakers didn't reach a deal by July 1.
Catch up quick: Negotiators punted the larger tax exemption fight to next year while adding on a tax that charges data centers for their energy use, a temporary fee expected to generate up to $600 million annually.
- They also ordered a broader study into the industry's economic and environmental impacts and whether Virginia should collect more revenue from data centers.
For Richmond: The two-year budget sets aside $50 million for the city's Combined Sewer Overflow program, a state-mandated project that requires Richmond to stop sewage from entering the James River by 2035.
- City leaders last year had requested $200 million to help make that deadline.
- The budget also includes a $20 million minimum toward repairs and upgrades to Richmond's water treatment plant.
- Mayor Danny Avula had asked for $80 million toward the city's water infrastructure to avoid "the need for future rate increases on Richmond residents."
Yes, but: Avula spokesperson Mira Signer told Axios the administration is "so pleased" with the allocations, noting some localities — like Hopewell and Emporia — sought similar funding and received none.
The intrigue: The budget also establishes the Richmond Regional Water Workgroup, which will include 10 state and local leaders, including the DPU directors (or chief administrative officers) of Richmond, Chesterfield, Henrico and Hanover.
- The group must meet by August and provide an annual report to the Legislature by Nov. 1 about concerns and recommendations for making sure Richmond is a reliable "supplier of drinking water."
Plus: There's $15 million for demolishing the Coliseum, a key to redeveloping the downtown corridor.
- The money, which wasn't in either chamber's original spending plan, matches Avula's estimate for tearing down the long-vacant arena, where Prince and Janet Jackson once performed.
Zoom in: The budget also authorizes cities and counties to hold a referendum on an additional 1% sales tax to pay for school construction.
- Avula and RPS leaders have backed bringing it to Richmond, and city financial advisers estimate the tax could generate about $45 million annually.
- The referendum would first have to be initiated by City Council before heading to voters.
What we're watching: For Spanberger's signature.
