Correction: DLS Was There At Energy Conference

There was a Division of Legislative Services staff person present at the recent National Regulatory Conference in Williamsburg. My piece yesterday was in error.  Attorney Christine Noonan’s name was on the list and I missed it.  She’s been at DLS for a while, but only this session started as staff support for the committees doing energy legislation.  Even worse was any implication that the folks at DLS might not be interested in policy details, when my decades of experience with them has left me with firm knowledge the opposite is true.  No apology or correction was requested, which is all the more reason it was imperative.  I hope she and they will accept it.  A notation was added to the article.

Helping the Poor by… Replacing Lower-Income Housing Units with Mixed-Income Development?

The Highland Grove mixed-income community. Photo credit: Richmond Free-Press

The premise behind public housing is that “market failure” fails to supply enough decent and affordable housing for poor people. Government must intervene in the housing marketplace not only with subsidies but as a real estate developer to fill the gap. What government succeeded in creating all too often — from Chicago’s infamous Pruitt Igoe towers to Richmond’s public housing courts — is concentrated poverty, crime and social dysfunction. Learning from past disasters, the public housing sector now sees the solution as diluting poverty by bundling low-income housing with middle-class housing under the rubric of “mixed-income” development.

Ironically, the consequence of implementing this philosophy in Richmond is less low-income housing and more middle-income housing.

The Richmond Redevelopment and Housing Authority has decided not to replace 22 of the 60 public housing units in Dove Court that were bulldozed in 2008 in order to make way for a a mixed-income community called Highland Grove. Reports the Richmond Free-Press: Continue reading

Dominion Responds to Calls for Deregulation

William Murray

Dominion Energy has responded to calls for electric deregulation in the form of an op-ed by William Murray, senior vice president of corporate affairs and communications. His argument: We tried deregulation once, it didn’t work, and the arrangement we have now works just fine.

Electric deregulation was “in fashion” in the 1990s,” he wrote in the Richmond Times-Dispatch. “It promised lower prices and more choices for customers. What really happened was something quite different. In fact, electric rates in deregulated states are more than one-third higher today than rates in states that have retained regulation.”

Moreover, Murray argued, 1990s-era deregulation did nothing to make the electric grid stronger, more secure, and more resilient — “pressing needs today in the face of threats such as cyberattacks from hostile nation-states.” To the contrary, deregulation invited predatory players like Enron into the system, leading to price spikes in New England, Maryland, Delaware and California. The outcome in California was particularly disastrous, bringing rollouts and widespread economic chaos.

Maybe his argument stands up, maybe it doesn’t. This may sound like a cop-out, but we need more data.

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Layne Cautions Again about Excess Debt and Risk

The good news in Secretary of Finance Aubrey Layne’s presentation to the House Appropriations Committee this morning is that General Fund revenues, after a below-forecast start to the fiscal year, surged 27.4% in April. On a year-to-date basis, total revenues are 6.2% ahead of last year, beating the 5.9% forecast for Fiscal 2019.

The bad news is that U.S. economic prosperity is built on a mountain of consumer, corporate, and government debt. The national debt stands at $22 trillion, and the Congressional Budget Office says that debt as a percentage of GDP could increase from 78% this year to 96% by 2028. Plus, student debt exceeds $1.5 trillion, and credit card debt has surpassed $1 trillion, both record highs. And corporations are carrying a $9 trillion debt load, almost double the level of the Great Recession. At 46% of GDP, corporate debt is the highest on record.

Layne, a traditional fiscal conservative, is not predicting an imminent recession. Rather, he is saying that the U.S. economy and, by extension, the Virginia economy and state budget, are highly vulnerable to a downturn, should one occur. Continue reading

Northam Finds Salvation in Victimhood-and-Grievance Agenda

Funny how things worked out. Democratic Party cries for Ralph Northam’s resignation during the blackface scandal have diminished to a barely audible murmur. Now the establishment media is taking notice of the fact, stating out loud what everyone knows: The scandal has passed. Northam is off the hook. Virginia’s governor has purchased absolution by advancing the racial agenda of the party’s progressive wing.

As the Wall Street Journal notes today in its national news coverage, Northam recently vetoed two mandatory-minimum sentencing bills he claimed would disproportionately affect African-Americans, created a director-of-diversity position, and launched a review of how public schools address black history. And that’s just the headline news. Of greater import, his appointees are injecting progressive priorities into the public school system.

I don’t doubt that the outrage of Democrats, liberals and progressives over Northam’s blackface offense was genuine at the time. But at the end of the day, power trumps outrage. By threatening Northam with the end of his political life, the Left pushed the politically moderate governor into advancing a progressive victimhood-and-grievance agenda. Continue reading

VA Energy Regulatory Conference All About Carbon

The Hon. Bernard McNamee, Federal Energy Regulatory Commission

WILLIAMSBURG — “The environmentalists don’t want to admit when they’ve won, but they’ve already won.”

That line was delivered by Joseph A. Rosenthal, principal attorney at Connecticut’s Office of Consumer Counsel, during a discussion Thursday on the status electricity grid modernization efforts in his state and several others.  It was a part of a day-and-a-half National Regulatory Conference and William and Mary’s law school which had several nominal topics but was really about carbon regulation.  Continue reading

Now Everybody Has a Club on Abortion. Wonderful.

Watching the abortion issue being shoved into the coming Virginia elections by ideologues on both sides, it is fair to ask the question:  Can the center hold?  Are the many people who are fairly comfortable with the state of the law these last few decades going to be sorry with an outcome in either direction?

The point has been well-made that the debate over the less-restrictive third-trimester abortion rules, proposed in a failed bill during the 2019 General Assembly session, involved very few cases.  As reported by the Richmond Times-Dispatch long ago, under the current law third-trimester abortions are not happening here.  The bill in question might have changed that, but not much.  Continue reading

What can Virginia learn from Nashville (Part 2)?

Update. In the first installment of this two installment post I described the metropolitan juggernaut that is modern day Nashville. I also provided some historical perspective on how Nashville became the sixth fastest growing US city (measured along several axes) between 2011 and 2016. As a side note, the 35 fastest growing cities documented in the prior link included no cities in Virginia. I have family in Nashville. For three of the last four years I have visited my family, run in a wildly popular race and witnessed the remarkable growth of Music City. My 2019 trip is complete and this article is the promised update.

First, a step back. Admiring the rapid growth of Nashville requires a fundamental belief. One has to believe that rapid growth in urban areas is a good thing. This is not a universally held belief, in Virginia or in Tennessee. Thomas Jefferson, for example, was quoted as saying, “When we get piled upon one another in large cities, as in Europe, we shall become as corrupt as Europe.” While I understand the bucolic allure of country living I believe that the economic future of the United States and Virginia will largely be in the cities. I think Virginia should be striving to create an environment conducive to fast growing, safe, livable cities. To that end much can be learned from Nashville as well as Charlotte, Austin, Raleigh, etc. Continue reading

Incentives Have Negative Impact on State Fiscal Health


Subsidies, tax breaks and other economic development incentives may attract corporate investment to a state, but do they pay for themselves or represent a net drain on state resources? Based on data from 32 states, a study by four North Carolina State University researchers find that the overall net effect is mildly negative, although results vary by the type of incentive.

Fortunately for Virginia, according to that data, the Old Dominion ranks second-to-the-bottom for incentives as a percentage of economic value added. Continue reading

VEDP Snags Recognition as Best Economic Development Organization in Nation

Site Selection magazine has awarded the Virginia Economic Development Partnership (VEDP) its Prosperity Cup as “the most competitive state-level economic development group” in the country. That’s quite a turnaround for an economic development organization that only two-and-a-half years previously the Joint Legislative Audit and Review Commission (JLARC) had found to be inefficient, ineffective, and suffering from “systemic deficiencies.”

The magazine credited VEDP’s jump to first place, from sixth in 2017 and 2018, to CEO Stephen Moret for assembling a team that’s “serious about economic development..” Virginia’s success in nailing down two mega-projects, the $3 billion Micron Semiconductor deal and the nationally touted, $2.5 billion Amazon HQ2 project, certainly didn’t hurt.

Amazon and Micron “were obviously two signature wins for Virginia in the last several months, but there are a lot of other great things going on all over the state,” Moret told Site Selection. In addition to the two mega-projects, Virginia snagged an impressive $5 billion of investment in smaller deals.

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Cuccinelli to North Carolina on Electricity Regulation – Avoid Virginia’s Mistakes

The Cooch is back. Former Virginia Attorney General Ken Cuccinelli penned an op-ed for the Wilmington, North Carolina based Star News opposing Duke Energy’s proposed changes to electrical regulation.  The title of the opinion piece is, “N.C. should block this Duke Energy power grab”.  Cuccinelli’s biggest issue with the pending regulation is extending the period of time between utility rate cases.  The editorial board of the Star News agrees. Cuccinelli writes:

“Key provisions to extend the period of time between utility company rate cases are embedded within N.C. Senate Bill 559, being debated at the N.C. General Assembly. Similar provisions hurt Virginia customers, and will hurt North Carolina customers, too.”

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Dumping, Again, on the Lowest-Paid Folks

A recent article in the Washington Post highlights an issue I alluded to in my recent post on government outsourcing  functions.  To summarize:  The Alexandria school superintendent’s budget proposal called for eliminating 30 custodian positions and outsourcing the jobs to a private company.  (The system already contracts with private companies for custodial services in many schools.  This proposal would have completed the outsourcing.)  The reason for the proposal was budget savings.  After a lot of blowback, the superintendent relented some, proposing that custodians who had worked for the school system for at least five years could keep their positions during the next school year.  That left 10 custodians facing the loss of their jobs.

This sort of outsourcing is common at all levels of government.  In Richmond, the custodians for state buildings are not state employees, but work for a company that has contracted with the state to clean the offices.  The same is true for security guards at the entrances to state buildings, with the exception of the Capitol Police. Continue reading

Spending Increases, Road Quality Decreases

Source: “Repair Priorities 2019

A new study by Transportation for America and Taxpayers for Common Sense documents the magnitude of the “Growth Ponzi scheme” in the U.S. road transportation system. Between 2009 and 2017, the 50 states collectively added more than 223,000 lane miles to their road networks. At an average cost of $24,000 per lane mile to keep roads in a state of good repair, that means states and localities have pumped up their maintenance liabilities by $5 billion a year.

But the states aren’t keeping up with those costs, contends “Repair Priorities 2019.” Nationally, the percentage of roads in poor condition increased from 15% in 2008 to 20% in 2017.

The problem isn’t a lack of money, argues Beth Osborne, director of Transportation of America. “We’re finding the money for expansion. There’s too little money to do everything, but we’re insisting that we do everything.” Continue reading

Dominion Energy Joins Consortium Demanding Climate Change Legislation

Image credit: Power for the People VA

I am not making this up.  Yesterday, Dominion Energy joined a newly launched coalition of more than a dozen major corporations and environmental groups – CEO Climate Dialog.  This organization will urge Congress to pass climate change legislation.  Example members of the group include BP – an oil and gas company, Citibank, Dow Chemical, DuPont, Exelon – a power company and The Nature Conservancy, an environmental organization. Continue reading

Dominion Announces Support for Carbon Tax

Dominion Energy has joined a coalition of 13 corporations and four leading environmental groups in support of a carbon tax and other measures designed to reduce CO2 emissions. The group, known as the CEO Climate Dialogue, has set a goal of achieving economy-wide reductions of 80% or more by 2050, with aggressive near- and mid-term emission reductions commensurate with that goal.

The group “aims to build bipartisan support for climate policies that will increase regulatory and business certainty, reduce climate risk, and spur investment and innovation needed to meet science-based emissions reduction targets,” according to a press release issued yesterday.

The CEO Dialogue listed six principles to guide federal legislation: Continue reading