Legislative Newsletter
February 15, 2008

". . . We now face a $1.4 billion revenue shortfall five days before reporting out the House budget,"   House Appropriations Chairman Lacey Putney

Crossover has left 1,190 out of 2,990 introduced bills still moving forward. Another 340, mostly commending or memorializing resolutions, have already passed both houses and await the Governor’s signature. But the biggest issue is how to resolve the budget when there’s a $1.4 billion revenue shortfall. The Governor’s most recent budget cuts are not sitting well with GOP leaders, though there appears to be more willingness to consider use of the rainy day fund to resolve at least part of the revenue shortfall.

The House and Senate will release their revised budget summaries this Sunday. We will issue a special report early next week with budget information important to nonstate agencies in our region and any other information you need to know. Competing bond packages are still moving forward. A version introduced this week at the request of the Governor by Senator Colgan (SB 795) and Delegate Putney’s version, HB1547, will have to be reconciled in order to pass this year. And there seems to be general agreement that a bond package will be passed, with many higher education and other state entities counting on it.

Homestead Exemption still looms large – Please e-mail your opposition Now!

The Senate resolution allowing up to a 20 percent Homestead Exemption in Virginia failed last week, leaving an identical House passed measure in the Senate that again must be defeated. 

The Governor’s recent cuts include aid to localities. This comes at a time when home sales are declining and revenues are slowing. If the Homestead Exemption were to pass, it would most certainly result in a combination of reduced local government services, including education and public safety, and increased taxes on the business community. Homestead Exemption is bad public policy.

The House bill has been assigned to a Privileges & Elections, a different Senate committee from the one that stopped the earlier Senate version. Please contact these members and urge them to vote against the remaining House versions HJR 4/HB 11 (Albo) and to support a referral of the bill to Senate Finance: Howell, Martin, Stolle, Deeds, Whipple, Obenshain, Puckett, Edwards, Blevins, McEachin, Petersen, Smith, Barker, Northam, Vogel.  Contacts must be made now with all committee members. 

Senator Northam's bill on Homestead Exemption, SB496, cleared the Senate and has been assigned to the House Privileges and Elections Committee. However, this bill cannot be implemented without the passage of a constitutional amendment.

Transportation

While no bills with significant budget impact are moving forward, several other transportation bills are worth noting.

According to a recent Associate Press article, Virginia has about 20,000 bridges with 1,746 considered structurally deficient. While this doesn’t mean that all structurally deficient bridges are unsafe, VDOT is expected to spend around $150 million of its estimated $4 billion budget this year to maintain and repair bridges.

One of the few bills that would raise significant revenue for transportation that’s still moving forward is SB713 (Saslaw). It would increase the state motor fuels tax rate by $0.05 per gallon in increments of $0.01 per gallon in each of the next five fiscal years and the revenues would go to the Highway Maintenance and Operating Fund. Each cent on the gas tax generates $50 million per year.  While it has passed the Senate, the House has vowed to defeat any gas tax increase.

With the elimination of abuser fees, HB 3202 promised increase of $200 million a year in new maintenance funds has already been reduced by $60 million a year. Virginia ’s highway maintenance needs now exceed revenues by an estimated $300 million a year, which means that $300 million is taken from construction funds. To make matters worse, the maintenance shortfall is projected to grow by $50 million per year, likely exceeding $500 million per year in less than 5 years. A couple of House bills have continued higher fees for DUI violations to add revenue. 

Meanwhile, Virginia has the nation’s ninth lowest gas tax (17.5-cents per gallon). A one-cent per gallon gas tax essentially would keep the current $300 million shortfall constant.

HB1516 (Gilbert)/SB754 (Obenshain/Edwards) would require General Assembly permission to charge tolls on interstates before a Public Private Transportation Act (PPTA) could proceed. This at a time when PPTAs and related tolls have often been considered the best hope for fixing, expanding or constructing Virginia interstates and primaries, such as US 58 along Southside and US 460 toward Virginia’s Port. What impact these bills will have if they become law is unclear other than to possibly delay or discourage a PPTA project. VA WEST is monitoring.

This format allows you to check bills and their status at a glance, by category. If you have questions along the way, please feel to contact Joyce Waugh at jwaugh@roanokechamber.org or 540.354.5487 or Tori Williams at twilliams@roanokechamber.org or 540.983.0700 x 229.  

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