News

Legislators Warn Of Deep State Budget Cuts

December 3, 2009

By Erika Jacobson Moore
Souce: LeesburgToday.com

Members of Loudoun's new delegation to the General Assembly met with members of the Board of Supervisors and the Loudoun Chamber of Commerce this week to discuss their priorities for the 2010 General Assembly session, which will convene Jan. 13. The economy and the upcoming state budget deliberations dominated the conversation during both meetings, with local elected representatives and business leaders wanting to know what the state was going to do about the multi-billion dollar budget shortfall.

Transportation, telecommuting and improving the way government is run also remained top issues that the delegation hopes to work through.

State Budget

"Brutal" was the word most often used when members of the delegation talked about the upcoming state budget discussions, in recognition that this year's debate would likely involve decisions about cuts to programs or elimination of programs that no one would like to see affected.

"We're going to have to share and share the grief alike," Del. Joe T. May (R-33) told the Chamber of Commerce. "There is going to have to be some additional general cutting."

Del. Tom Rust (R-86) predicted the General Assembly would have to cut an additional $3.5 billion from the budget by the time the session reaches February and said he believes outgoing Gov. Tim Kaine (D) will propose a tax increase to balance the budget, something governor elect Bob McDonnell (R) has opposed.

"We're going to start day one with a big fight," he said.

Rust also noted that 41 percent of the state budget goes to education, 25 percent goes to health and human services and between 15 and 20 percent goes to public safety.

"So where are we going to cut all this money we need?" he asked.

One of the main concerns raised by the Board of Supervisors as well as other county department leaders is what will happen to the aid given by the state to localities, particularly for things like education and public safety. When asked by Supervisor Lori Waters (R-Broad Run) at a luncheon Tuesday whether aid to localities would be "the first thing on the chopping block" the answer from the delegation was a mix of silence and "we don't know."

Legislators told supervisors they did not think the state would eliminate its annual personal property tax reimbursement promised to localities after the General Assembly voted to eliminate the "car tax" used to fund local budgets..

"We are a little concerned about that," Supervisor Jim Burton (I-Blue Ridge) acknowledged. "We see what you all are facing and that would be an easy one for someone to latch onto."

For Loudoun that contribution is $48 million, the maximum allowed after the assembly capped its reimbursement in 2006. With that cap, most vehicle owners returned to writing car-tax checks, albeit for smaller amounts. Any effort by the state to eliminate the reimbursement is expected to be reflected in higher bills.

During the Chamber breakfast Thursday, Clerk of the Circuit Court Gary Clemens said he was concerned about unfunded mandates coming from the state to localities, resulting in more work for county employees, without the funding to cover the cost.

While the delegation acknowledged there was no plan to address unfunded mandates, members said they understood the issue facing localities and recognized something would need to be done.

Sen. Jill Holtzman Vogel (R-27) said she had heard that issue from many of her constituents and local governments within her district and people are "very concerned" because often they are on hiring freezes and have no ability to give raises to employees that are taking on more work, and therefore losing employees to better paying jobs with less burdensome work.

"I'm not certain if there is a single measure look at unfunded mandates," Vogel said. "We all just have to be mindful of the impact they have on people in our districts."

May noted that the state is not the only one providing mandates to localities, but said for those that do not come from the federal government the General Assembly goes "to great lengths to not make you do something that we don't have the funding for."

All members of the delegation said they were committed to cutting as little as possible from education and public safety, because, as Sen. Mark Herring (D-33) put it, "we don't want to cripple our successful" programs. Herring also noted it was important to increase the state's relationships with the area nonprofits and faith-based organizations to ensure there is "a safety net for those most vulnerable" if certain government-run programs see major reductions in funding or staff.

Transportation

Rust told supervisors during their luncheon Tuesday that he would continue to "tilt at windmills" and propose another comprehensive transportation plan, one he is working on with Del. Joe T. May (R-33) and others. But at the Chamber of Commerce Thursday, he made it clear some unpopular notions would need to be accepted to make the plan successful.

"Nobody wants to hear this, but it can't be done without additional revenue," he told the Chamber. "It will take new money."

Rust said to make any transportation plan successful it would take the support of the local business communities, thanking the Chamber members for their support of the last transportation plans in the House of Delegates Finance Committee.

"We're going to need your help again," he said.

When asked by a member of the Chamber whether they supported raising the gas tax to help pay for transportation, answers were mixed, mostly stemming from the instability of the fund. The legislators noted that the gas tax would only be good as state residents continued to buy gas.

"It is staggering how deficient that has become over time with increases in fuel efficiency," Vogel said.

With the increase in electric and hybrid cars, residents are needing to gas up less frequently, leading to a decrease in the gas tax fund and its unattractiveness as a long-term revenue source, the legislators said, but that does not mean that it cannot be part of the solution.

"It is fair game," May said, "but I think it should be applied to the maintenance of roads only."

If the gas tax were to be increased by 15 cents, May said, that would generate approximately $750 million, which is about what the state needs to improve roads. But any increase in the gas tax would have to be kept in the area where it was raised, he said, a point on which many members of the delegation agreed.

"It's about regional protection," delegate-elect Tag Greason (R-32) said. "You pour the money in and it all goes down south. That's not right."

Delegate-elect Jim LeMunyon (R-67) said one of his first actions would be to see the state use the $3 billion in bond authority left from the failed transportation bill of 2007.

"It takes no new action of the General Assembly to issue those bonds," LeMunyon said. "And it is not subject to that transportation formula we love to hate in Northern Virginia."

Sen. Mark Herring (D-33) said it was important also to focus on projects that could be successful and bring an improvement to the quality of life for residents, such as was done for the Dulles Metrorail Project, Rt. 28 and the planned Rt. 50 widening.

"We have had some successes by cobbling together funding from a variety of sources to get a project moving," he said. "We need to continue those efforts."

At their Dec. 1 luncheon, county supervisors remained concerned that the state might ask localities to take over secondary road maintenance, a responsibility that they say would prove difficult for the county.

Rust did note that if the county was successful in receiving the equal taxing authority granted to towns and cities, it would have to take everything that came along with it, including road maintenance.

Government Restructuring

While difficult economic times usually mean program cuts and the tightening of belts, members of Loudoun's delegation told the Chamber of Commerce it also could bring about opportunity.

"Sometimes some of the worst economic times and challenges give you some of the greatest opportunities," Sen. Jill Holtzman Vogel (R-27) said of the chance to change the way the state government is run. Vogel said this budget cycle would present the opportunity to make the regulatory process better for business and residents.

Del. Tom Rust (R-86) said one of the big changes that need to be made is between state and local government.

"The whole state of Virginia government needs a very, very hard and serious look at the relationship, responsibilities and governance between localities and the state," he said. "Things are way out of whack right now."

Del. Bob Marshall (R-13), while not present at the Chamber breakfast told supervisors Tuesday he was planning on pushing legislation that would create efficiency councils, made up of 10 delegates, four senators, and seven members of the public, to look at the operations of each secretary appointed by the governor and their respective agencies to identify potential savings.

While noting they did not "go around to people's desks and fire them," the delegation said governor-elect Bob McDonnell is planning and agency-by-agency review and the government will have to look at the best way to do business and ensure that if layoffs have to happen, the right people remain in place. Del. Joe T. May (R-33) reminded the audience that the Virginia Department of Transportation was mandated to lay off 1,500 employees by April 2010 and so far only 360 positions have been identified. To find the remaining 1,100 position is going to take some thinking about the way in which the agency will run in the future, he said.

"There's no merciful way to do it," he said, adding that he has been faced with those decisions as a business owner in the past. "Nothing keeps me up more at night than playing who's got a job."

The county is also looking at restructuring the way it does business, but is seeking the General Assembly's help in getting there. The county is seeking the legal authority to consolidate similar functions, such as land acquisition and capital construction management, with the school system. The county and the schools already have some consolidation in place when it comes to transportation maintenance and information technology.

At Tuesday's lunch, Rust noted localities already have the authority to consolidate, but it is when there is objection from the School Board that problems arise.

"We charged the superintendent and the county administrator to talk through the area where they saw the possibility of consolidation," Supervisor Sally Kurtz (D-Catoctin) told the delegation of the action of the committee for both boards. "The two of them came back to us and said they were unable to find further areas of agreement and an independent study should be done. We are moving towards that."

Herring told supervisors he had heard talk of consolidation during a recent Senate finance committee retreat featuring a presentation by several representatives from local governments throughout the state.

"All three said it was essential that there be mutual trust between the county administrator and the superintendent and the School Board and the Board of Supervisors," he said. "There was some concern expressed by the [non-Loudoun] School Board representative there that they will receive less funding if some of the functions move under the county government [and ] that there might be less money coming from the state. The state is looking at removing that so school districts would be held harmless if they could achieve savings through the consolidation."

Burton also brought up an item in the School Board's legislative packet, a study on the pros and cons of allowing a separate taxing authority for School Boards, and wanted to "get the temperature" of the delegation. "It has been my experience that two tax masters always ends up with a heavier tax load," he said.

Members of the delegation said they were not interested in pursuing separate taxation. May and Marshall said in their 16 and 18 years, respectively, the issue had been brought forward a number of times and never been received favorably. Rust, however, noted he had introduced similar legislation last year, and got his bill further than any previous effort, to a hearing in committee. He did not commit to producing similar legislation this year.