DATE:       February 3, 2006

 

HOUSE AND SENATE BOTH NOW AT FULL STRENGTH

 

All of the citizens of the Commonwealth now have representation in this 2006 Session of Virginia’s General Assembly.  The last of five special elections was held this past Tuesday.  Senator Mike Herring was sworn in Thursday morning.  This gave the Senate its full complement of 40 members.  As reported in the January 27^th Giesen Perspective, Chris Peace won the special House election on January 24^th and was sworn in on the 25^th completing the House contingency of 100 members.

The 2005-2006 Special Election season has been rather revealing for some of the Capital pundits.  Because of the closeness of the November 8^th voting results for the Attorney General’s position, the Board of Elections had to wait until after the recount to get all of the voting machines out of the court order “lock down.”  This couldn’t be done until the deadline for an appeal to the initial recount passed.  Thus Virginians were “treated” to an unusually political January.  Five special elections were held.  There was an election for a legislative seat on every Tuesday of the month except the 17^th. 

Let’s take a brief look at the results.  On January 3^rd the two races—one to fill the House seat (District 3—Southwest Va.) vacated by Jackie Stump due to illness and the vacant Senate seat (District 4—Hanover area) caused by Bill Bolling’s election to the Lt. Governor’s position.  Both of these went according to predictions.  The Democrat candidate—Daniel Bowling took 60% of the vote in winning the House seat and Ryan McDougal moved over from the House to the Senate with 81% of the votes cast in the 4^th Senate District.  In the SW 25.24% of the eligible voters took the time to vote while in the more “urban Senate district” only 6.79% of the register citizens cast a ballot. 

Then on the second Tuesday of the month, 33.53% of the register voters came to the polls in the hotly contested race for House District 23. This Lynchburg area seat became vacant when Preston Bryant resigned after being appointed Secretary of Natural Resources by then Governor-elect Tim Kaine.  This seat had been held by a Republican since 1978.  But things seem to be changing in various parts of the state.

On the third Tuesday of the month the changes taking place became more evident.  The Republican candidate, Chris Peace, won the 97^th House District seat vacated by Ryan McDougal, but garnered only 50.83% of the votes in this Hanover area district.  This has been considered “a very safe district for the GOP” by all the political “experts!”  One has to consider the fact that John Montgomery, the Democrat candidate (48.39% of the votes), was a long time resident of the area and by most estimations a very attractive candidate.  The intensity of the campaigns may account for the 17.72% turnout of voters in a house district that overlaps about half of Senate District 4 (see above). 

The final special election of this unusual January caused eyebrows to be raised even higher by the “political experts.”  The Republicans in the fast growing 33^rd Senatorial District (western Fairfax and a large part of Loudoun, the fastest growing county in the country) nominated David M. “Mick” Staton.  Mick is a member of the Loudoun County Board of Supervisors and the son-in-law of former Delegate Dick Black.  You will recall Republican Dick Black lost his house seat in November at the same time that Tim Kaine was shocking the same “political experts mentioned above” by racking up 53% of the Loudoun vote.  The Democrats on the other hand nominated Mark R. Herring, the 44 year old stepson of former state Senator Charles Waddell.  Now Charlie Waddell served in the State Senate 26 years before a Republican Governor (Gilmore) appointed him to a job in the Virginia Department of Transportation.  This vacated the seat which Bill Mims then won in a special election.  Mims this year vacated the seat when the new Attorney General Bob McDonnell appointed him Deputy AG.  So the seat now goes back to a Democrat. Mark Herring captured 61.63% of the votes (out of 13.67% of the eligible voters who went to the polls).

Isn’t politics a fascinating game?  It should be pointed out that Mark followed the Tim Kaine formula, campaigning on the issues of transportation and education needs and on reining in suburban sprawl.  He also stated he would have voted for the tax increases of 2004 while Mick stressed he would not have done so (his father-in-law had voted against these bills).  It would appear the thinking of voters really is changing. Despite the contention that all politics is local the margin of this election and the closeness of the one in the 97^th House District, should send a message to some house legislative leaders that the citizens aren’t thinking the same as they were six or seven years ago.

 

THE ASSEMBLY-- STILL AT A FAST PACE

 

Even though the legislators introduced fewer pieces of legislation than in the ‘04 or ‘05 sessions the pace of this years General Assembly continues to seem quicker and faster than in the past. One state senator’s statement makes this point.  When intercepted in the lobby of the General Assembly Building (isn’t GAB the right name for the building where most of the committee meetings of the legislature are held?) on the way to her office and asked, “May I walk with you to discuss an amendment to a bill in your committee this morning?” She replied, “No, but you can run with me and I might be able to listen as we fight through the crowds.”

The fact that she voted to amend the bill as recommended does indicate she, like most of the legislators, has learned to listen and learn “on the run” and still make sound decisions.

 

THE BUDGET–THE SUB-COMMITTEES START “LISTENING EARLY.”

 

The crossover date–when each house must, by the rules, complete its work on its own bills (except the budgets)–this year falls on Tuesday, February 14! Whether there will be any “love” displayed on this Valentine’s Day remains very uncertain.  The House Appropriations and the Senate Finance Committees will report their respective budget bills on Sunday, February 19^th. Even though there were fewer bills introduced this year than in recent sessions, the number of budget amendments increased.  As noted in last week’s G.P. when there is a surplus, the tendencies of legislators is to ask for more state funding for “very worthwhile, urgent, needed” projects in their districts.  Because of the volume of amendments and smaller number of bills, the sub-committees considering the various sections of the budgets have started hearing the members’ arguments earlier than usual.  Normally the members present their budget requests late the week before crossover. 

Making decisions on which amendments to approve is not going to be an easy job for the money committees.  Before one of the budget hearings the presiding senator warned the presenter, “You must understand we have over $4 billion, that’s billion with a ‘b,’ in requests.  That’s $4 billion in amendments chasing the $100 million, that’s with an ‘m,’ which we expect to have to spend on non-mandatory items.  Good luck!”

 

TELECOMMUNICATION TAX STRUCTURE WILL CHANGE

 

Both houses are processing legislation which will change the looks of any bills (invoices) you receive from your telephone supplier, your cable company, etc., etc. and so forth.  The so-called Telecommunication Bills move the state and localities from a number of “specialty taxes” to primarily a 5% sales tax on a much broader range of services.  The net result will be a tax reduction for some people and a tax increase for others.  For instance, people with dishes and satellite TV service will now pay a tax as will cell phone users.  Those with land-line telephone services will still pay a tax but not as much.  While the final version of the bill will be worked out in conference the major provisions are set.

Some localities have expressed major concerns with this new approach.  Even though the bills are the result of a two year study and a multitude of compromises in which the Virginia Association of Counties and the Virginia Municipal League participated, local officials remain skeptical.  The state will now collect the taxes and distribute them to the localities. The distribution will initially be based on the taxes collected by each locality from the 2005 taxes which they collected from their telecommunication tax base.  The problem stems from past experiences which localities have had with the state collecting and then distributing what were formally local taxes.  The “no car tax” pledge comes to mind as does the so-called “599 funds” for local law enforcement purposes. 

The thinking goes, what happens in future years if there is a downturn in the economy and legislators (and perhaps future Governors) see this pot of money all going back to localities?  Localities don’t get the full 5% sales tax, so why should they get the full 5% of this telecommunication tax.  Since legislators will change and then there may be a shortage of those who remember this change was to simplify tax bills and individual telecommunication companies’ tax collection responsibilities.  So, the thinking goes, the General Assembly will say, “OK, we’ll give the localities their proper 2% of this sales tax and we’ll use the other 3% to help balance our budget.”  Of course, all of us know the current legislators don’t think like that, but what about those who might get elected in the future?

 

TRANSPORTATION

 

While this is still considered the big issue for this session of the GA, a consensus seems as remote as it did when the Assembly convened.  Maybe it is even more so now than two weeks ago.  Now it is apparent there are not just three plans--onefrom the House, one from the Senate and one from the Governor.  The House Republicans have just come out with a caucus plan.  Various pieces have been discussed publicly for a week or so–one would allow localities with population growth rates of 5% or more between  each census to accept cash or property offers from developers (the threshold is presently 10%) and then another bill would allow these proffers to qualify as a local match toward a $100 million annual revenue sharing grant program which the state would set up.  According to Speaker Bill Howell, who has been the spokesperson for these bills, they would help localities deal with development and transportation problems and coordinate with the state.

Other bills in this “package” would require localities to provide cost estimates of road and transportation improvements in their comprehensive capital plans.  Most localities already do this, however under this and other recommended legislation, localities would have to submit their plans and traffic impact statements for review by the Virginia Department of Transportation.  The VDOT planners would help localities compute the price tags of local zoning decisions. 

The need for this type of coordination was heard in many of the public hearings conducted by both the Senate and the House during the summer.  Both of the plans presented by the Governor and the Senate have stressed the need for better cooperation between VDOT and localities in determining the transportation implications of zoning decisions.

All three of the players in this drama also seem to concur that any transportation program on which they might agree will need an infusion of about $1 billion annually.  How to achieve this is the GREAT BIG QUESTION.  The Senate’s proposal on raising the titling tax from its current 3% to a recommended 5% level is meeting opposition from some of the moderate Republican Senators who supported the 2004 tax package.  The Automobile Dealers Association is, as one might expect, against this tax.  This association has been for a long time a healthy supporter of Republican candidates.  For many in both houses it would be a tough vote to raise this tax.

Then within the House Republicans, the no-new-taxes under any circumstances conservatives still hold the day.  So, despite the apparent recognition of the need for an additional $1 billion per year for transportation, there has been no specific funding recommendation emerging from the most numerous body.  The results of the most recent special elections do not seem to have influenced the thinking of those who have the leadership positions in the House.  Do remember, while considering statewide problems such as our “transportation crises,” legislators are still responsible to the constituents in their home districts.  It doesn’t always make the task easy. 

 

LEAVE THE COMMITTEE LAUGHING–SOMETIMES IT HELPS YOUR CAUSE

 

Bill Lighty, Governor Kaine’s Chief of Staff, presented to the House Appropriations Committee the Governor’s “Business Case for Enterprise Applications.”  This is a program to establish an automated system to support agencies’ compliance with policy decisions which cut across agency or state/local government boundaries.  Presently, according to the Council on Virginia’s Future (established by Governor Warner) there are “data islands” everywhere in various state agencies leading to an “operational hodgepodge” in the government with some very old and unsupported technology.  The Council further stated, “Many functions that management and staff need to do their jobs better are simply not available with the systems they have today.”  The outgrowth of the recommendations of the Council was Executive Order # 105 which established the “Enterprise Applications Program.”  From this an agreement with a private high tech firm to develop an integrated state system has been reached.  Bill explained this “performance-based, 7 year agreement, defined in 3 phases, subject to appropriations every step of the way,” to the committee. 

The cost of the 3 phases of the agreement breakdown as: Phase 1 (2006-2008)–$30.4 million of general fund dollars (included in the budget introduced by Governor Warner and endorsed by Governor Kaine, who sat on the Council); Phase 2 (2008-2010)–$150 million (estimate); and Phase 3 (2010-2012)–$100 million.  The estimated benefits from this effort to achieve best practices within state government indicate there could be $125 million in savings over the 7 years of the implementation of the program and annual savings of $48 million thereafter.  Under questioning as to how accurate these estimates on savings might be, Bill leveled with the Committee members and flatly stated, “These are guesses at best.  These are out years and therefore are really cost avoidances rather than savings.”

After a number of questions as to why this process will be better than some others which have had “horrible outcomes” the Chief of Staff left the committee in good humor when he quipped, “The time has been long, the hour is late, Mr. Chairman, I just want you to know this project is great!”   

My bet is this part of the Governor’s budget stays in tact.