Jim Shuler’s Legislative Report 1-26-01

Fiscal Responsibility

Money continues to drive the basic agenda of the General Assembly. Virginia has a biennium budget and we are in the final year of the two-year cycle. Traditionally, the Governor presents a broad budget on the even years and then the Governor and General Assembly fine tune the financial picture during the odd years to reflect any additional or unforeseen needs or changes in the economic picture. We began 2000 with a rosy financial picture and enjoyed the opportunity to reach beyond the barebones needs of appropriations. One year later we are facing the tightest funding year I can remember as a member of the House of Delegates. Budget figures released last week indicate that revenues have grown only .2% in the last six months. That represents an 11% drop from December ’99 and is well below the 3.8% prediction upon which the Governor based his budget and car tax relief package for 2001.As I have mentioned in earlier columns, I was initially concerned with two questionable directions in the budget the Governor sent to the General Assembly at the beginning of this year. First, he did not adequately consider the ramifications of an emerging economic downturn when continuing to pursue the financial requirements of the car tax—thus, I was wary his optimistic projections might not balance with actual revenue. With the release of the actual figures, that has proven to be the case to an even greater degree than I expected.

Second, by focusing solely on finding ways to fund the car tax, he extracted dollars from critical, established state programs and agencies—mental health, teachers’ salaries, public education construction resources and cultural projects in order to fund something that promotes residents in wealthier parts of the Commonwealth. The car tax is draining the coffers far faster than the Governor initially reported. The figures continue to be “liquid” and hard to document—but the dollars to pay for it are being diverted from current programs or borrowed from the Commonwealth’s future. I will not, in good conscience, take money away from our most vulnerable—children and the mentally ill—to fund a car tax that, using data from the Governor’s office, provides negligible relief to citizens in the New River Valley.

The General Assembly is now faced with the arduous task of restoring a more responsible approach to budget allocation. The process has already begun at all levels. The Senate Finance Committee has rejected some of the riskiest aspects of the Governor’s budget by refusing to allow the redirection of Tobacco Settlement funds and questioning the removal of funds from mental health and school construction. This year the House of Delegates has submitted 1,220 amendments to the Governor’s budget for a total of $2.4 billion. Senators have submitted a record 1,341 amendments for a total of $2.6 billion. Each chamber will attempt to work out what percentage of the car tax can responsibly be continued without risking the fundamental needs of all Virginians.

The differences in the two budgets and a final compromise budget will be determined during the final days of 2001 in late February.

One primary focus for me is the restoration of money for state employees. The Governor’s budget ignored a commitment to any teacher raises. This, in response to teachers having to tackle the new responsibilities required with SOL’s. I am working with colleagues to ensure that teacher raises are included in the budget. In addition, the Governor chose to pit categories of employees against each other. He allocated raises to “state employees” which I certainly support, but carved out those employees who work for constitutional offices—deputy sheriffs, and staff in the Commissioner’s office, Treasurer’s office and Clerk’s office. Not only is it an unfair division, it is a dangerous precedent that signals a divide and conquer spirit. Using a similar logic, he lowered the state’s matching share for employees enrolled in the Optional Retirement Plan from 10.4 to 9.24. It unfairly penalizes employees who, perhaps years ago, selected a retirement choice based on a pledge by the state.

The Governor has spoken sincerely about calling his car tax a promise he made to Virginia voters. Well before that promise, the Commonwealth made a long term promise to teachers, state employees, mental health programs, school construction ventures and cultural projects that the state would be there with resources and continuing support. It wasn’t a promise that said--unless times get hard or something else comes along. It is a trust we hold in perpetuity, not something done simply for the expediency of one administration.

The budget will be the long struggle of this session, and it leaves nothing untouched. Legislation that might have been heard on merits alone is being scrutinized for any costs involved. Eminent Domain bills that addressed the state’s responsibility in paying some professional fees incurred by property owners were rejected outright, with the easy excuse—“no money.” The General Assembly is asked to close mental hospitals because it will “save money.” A Public Defender’s office in Montgomery County is threatened because it “costs money.” The budget is the litmus test for the General Assembly in 2001.

As usual, I hope if you have questions or concerns about legislation mentioned in this column or any other legislative matters, you will not hesitate to contact me at any of the following Richmond addresses.

Jim Shuler’s Legislative telephone 804-698-1012
Jim Shuler’s Legislative fax 804-786-6310
Constituent Hotline 800-889-0229
Richmond e-mail address Del_Shuler@house.state.va.us