Legislative Newsletter
February 27, 2009

Adjournment Looms as Budget Talks Continue

House and Senate budget conferees have been working since Sunday to iron out the differences in their competing budget plans. If the negotiators can strike a deal in the next few hours, the General Assembly will adjourn on Saturday and return April 8th to consider any amendments and vetoes made by Governor Kaine.

The Contours of the Budget Negotiations

Faced with making even more draconian cuts from the state's $77 billion two-year spending plan, budget writers received a bit of a reprieve last week with the passage of the federal stimulus package. Interestingly, Governor Kaine has agreed philosophically with House budget negotiators that much of the  stimulus money should be dedicated to  infrastructure improvements or other projects that would require a one-time infusion of funds. Because the stimulus money runs out in two years, the state would be obligated to fund new programs or the expansion of existing programs in future years, two scenarios that must be avoided in this period of economic uncertainty. Questions still linger over the guidelines on how the federal stimulus  money must be allocated. Between now and the veto session in early April, much of this confusion should be clarified. 

The House and Senate have agreed to put aside $150 million in a reserve account that would act as a cushion against further declines in state revenues and have reached a tentative agreement on funding for education. In addition, a proposal by the House to cap the number of out-of-state students that are admitted to Virginia's public colleges and universities was discarded. However, several key areas of disagreement remain:

     Higher Education Funding - The House prefers funding cuts of 10% for four year colleges and 6.7% reductions for two-year schools. The Senate has recommended a 15% cut for four-year colleges and a 10% cut for two-year schools.
 

     Support Staff - The Governor and House support reducing the number of non-instructional school employees (janitors, secretaries, etc.) to one non-instructional staff position for every four teachers. The Senate considers this change to be the micromanagement of Virginia's school systems.  

     Early-Release - At a cost-savings of $5 million, the Senate budget plan would make certain non-violent offenders eligible for release 90 days before their sentences expire and would expand the use of electronic monitoring and house arrest. The House opposes this idea on public safety grounds.

     Dealer Discounts - With pressure coming from Virginia West and other business groups, House and Senate budget negotiators are likely to keep dealer discounts whole but will likely move ahead with a new sales tax remittance plan on larger retailers with annual taxable sales of at least $12 million. Large retailers would be required to make two payments beginning in June 2010:

1) Sales Tax for the previous month.

2) Sales tax on estimated sales for the first two weeks of the month.

This new system would be made permanent and would generate $97.8 million in revenue for the Commonwealth. The Senate had originally proposed a one-time accelerated sales tax to generate additional revenue, an idea opposed in the House. 

Other Notable Legislation

     Transportation

This week, the House and Senate differed on the how to protect transportation funds from being raided for other purposes. At issue is whether to create a lock box or a 'double lock box.' Senator Norment's constitutional amendment (SJ361), referred to as a 'double lock box,' would prevent funds dedicated for transportation from being transferred to the General Fund and vice versa. Delegate Glenn Oder's resolution, HJ620, would  prevent transportation funds from being used for non-transportation purposes. Many in the House prefer the single lock box concept because it would allow greater discretion on the use of the General Fund.   VA West has consistently supported this amendment.

     Employee Pay Cards

A bill (SB 1264) that would grant employers the authority to pay wages electronically by prepaid debit card or account card to those employees hired after January 1, 2010 who do not designate another method of payment, was approved on the House floor on Wednesday.  Under current law, an employee must give consent to be paid via a prepaid debit card.  VA West supports the concept of electronic payment.

      Trailing Spouse Exceptions

SB1495, a bill that would grant an exception to the 'no exception rule' that disallows unemployment compensation to an employee who voluntarily quits his or her job to accompany a spouse to a new job in another locality, passed the House after being stripped of an amendment that would have required Virginia's employers to cover the costs of these benefits through their contributions to the state unemployment compensation 'pool.' As this legislation is currently written, the federal government must appropriate funds for the provisions of this act to become effective. This year's version of the 'trailing spouse' legislation would have provided unemployment compensation to an employee whose spouse is on active military duty and is reassigned to another locality on a military related assignment. During last year's session, an exception was requested for the spouses of clergy who relocate to a new location. VA West has consistently opposed all 'trailing spouse' exceptions.

       Put Down That Blackberry

Both the House and Senate have passed legislation that would ban the sending or reading of text messages or e-mail while driving. The legislation excludes the reporting of an emergency, GPS Devices, and operators of emergency vehicles. A first time offender would receive a $20 fine while a subsequent offense would cost $50. Sending or receiving a text message would be a secondary offense meaning that an officer could only issue a ticket after stopping a vehicle for another offense. VA West supports this legislation.

Important Session Dates 

February 28th - Adjournment Sine Die

April 8th - Reconvened Session

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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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