Category Archives: Business and Economy

Dominion’s Ads Deceive About Ratepayer Impact

Dominion’s ad copy in this morning’s Richmond Times-Dispatch. Click for larger view.

by Steve Haner

Dominion Energy Virginia has launched a major advertising campaign advocating  legislation to increase its allowed profit margin, with ads focused on a deceptive message that the bill will actually lower costs for consumers.  It will not.

The print version of the campaign, which can be seen in a full page ad in the Richmond Times-Dispatch in print and online, refers to and reproduces part of a February 1 letter from the State Corporation Commission that answered one question about the bill, looking at one item in isolation from the whole. It ignores an earlier, longer, January 27 letter from the SCC that outlines the cumulative rate impacts from the bill.

With all its many deceptions, nothing tops the headline which implies the SCC has claimed this bill will save customers money. There is no other word for that than “lie.” Continue reading

Focus on the Standard Deduction, QBI Deduction

We tried to tell everyone. Indexing the tax code for inflation is wildly popular, but it’s not in the pending package.

We have seen this before in Virginia and here we go again: the classic conflict between tax cuts for the many versus more government spending for a few.

The Republican-dominated House of Delegates has passed a series of broad tax reductions, while the Democratic-dominated Virginia Senate has killed its versions of the same bills.  Last Sunday the Senate then produced a budget proposal about $1 billion richer in funds for education, mental health services and other poll-tested priorities.

Killing the tax bills creates even more revenue to spend in future years, billions more. Continue reading

Roller Coaster Casino Ride

by Jon Baliles

The road to a casino in the General Assembly is on a roller coaster ride that is careening down the hill and likely to jump the tracks at any minute. Last week alone, the bill that would allow a casino referendum in Petersburg and block a second one in Richmond until Petersburg has a chance has taken the following ride:

  • Cleared a Finance General Laws subcommittee on a 7-2 vote on January 26;
  • Cleared a Senate General Laws committee on a 11-4 vote Wednesday;
  • Failed in a Senate Finance committee on a 7-8 vote Thursday evening;
  • Cleared a House of Delegates General Laws subcommittee on a 5-2 vote on Tuesday;
  • Cleared a House of Delegates General Laws committee vote 7-4 on Thursday;
  • Cleared the House of Delegates Appropriations committee 11-9 on Friday afternoon.

So what’s next? Well, there are three possibilities: (1) the bill dies because the House and Senate won’t find a suitable compromise, which means the Petersburg proposal could vanish and Richmond gets another referendum; (2) the Petersburg referendum is inserted into the final budget language (as it was last year) and their referendum will proceed and Richmond’s put on hold; or (3) the zombie apocalypse will commence.

Personally, I’m rooting for the apocalypse. Continue reading

Push to Return Federal Workers to Offices – Monsoon or Squall in Northern Virginia

The benefits of 60 years of headlong federal government expansion, Northern Virginia edition.

By James C. Sherlock

The federal government has for nearly three years been paying very expensive leases for D.C area office buildings that are virtually empty.

COVID emergency.  Or was.

Now it is a battle between the comfort of federal employees with working from wherever they can get a good network connection vs. actually showing up at the office.

The feds report that as of the beginning of this calendar year, 47% of federal employees were still working remotely.

Since civilian federal employees thankfully still include people who work in other than an office as their normal place of work, we can assume that more than 47% of Northern Virginia federal workers are working remotely.

And we can assume they like it.  Would you like to try to get to D.C. every day from, say, western Fairfax County, much less the exurbs, if you didn’t have to?

Republicans in the House of Representatives and the Democratic mayor of Washington D.C have formed an unusual coalition to get them back to the office.

Beltway Democrats in the House fought it there and have lost so far .  Senate Democrats and President Biden, mindful that federal employees are one of their most dependable voting blocs, are unlikely to follow the House’s lead.

But it is secretly kind of fun to consider that Northern Virginia would sort of explode if they all tried to return in the same week.

Perhaps the experience would prompt efforts to return some of NOVA to a semblance of livability by distributing the headquarters of most of the agencies across the country.
Continue reading

Youngkin Thwarts Dominion Push for Higher Profit

Gov. Glenn Youngkin (R)

by Steve Haner

A Virginia House of Delegates committee has rebuffed Dominion Energy Virginia’s bid to change the rules on how much profit it can earn, setting up a confrontation with the utility and its allies in the Virginia Senate.  Governor Glenn Youngkin (R) reportedly encouraged the delegates to take the step and sent a member of his cabinet to speak in favor of watering down Dominion’s bill.

When they were introduced a few weeks back, House Bill 1770 and Senate Bill 1265 were identical.  It was probably Dominion’s game plan to have them remain identical as they passed in their houses of introduction by the February 7 deadline.  Now the bills likely to pass have morphed into very different substitutes, with all observers expecting a high stakes joint conference committee to follow. Continue reading

Now We Will Enrich Dominion’s Creditors, Too

Who gets rich when debtors make smaller payments over longer periods of time? The lenders, that’s who.

by Steve Haner

Facing the prospect of a jaw-dropping jump in electricity prices because of fuel price hikes last year, the State Corporation Commission approved Dominion Energy Virginia’s request to defer most of those costs for future collection. The unpaid bill for fuel already burned is now about $1.5 billion, apparently, and Dominion has a new plan on how to collect it from you.

Have you ever made the mistake of running up a big credit card bill, and then trying to pay it off by making just the minimum payment? The banks behind the credit cards love it when you do that, because of all the interest they collect over the years it takes you to pay down to zero. Dominion is proposing to do exactly that with that unpaid $1.5 billion in fuel costs. Continue reading

Five Reasons the Assembly Should Cut Taxes

By Barbara Hollingsworth

Last week, the Republican majority in the Virginia House of Delegates passed a $1 billion package of tax cuts for individuals and businesses, the centerpiece of Governor Glenn Youngkin’s economic agenda. But Democrats, who have a 22-18 majority in the state Senate, have a laundry list of policies and programs they would prefer to spend the surplus money on rather than return it to taxpayers.

Tax policy is a non-partisan issue that has real-world economic consequences, especially when it comes to taxes on business income. Here are five reasons why the state Senate should follow the House’s lead and pass the governor’s entire tax relief package, including reduction of the commonwealth’s corporate income tax rate.

There’s a very large budget surplus.

In fact, Virginia is sitting on a record budget surplus of $3.6 billion, which is revenue collected from businesses and individual taxpayers in excess of the needs and priorities state legislators have already identified and fully funded during the 2022-2024 biennial budget process. It’s disingenuous to suggest that Virginia “can’t afford” to return at least part of that surplus to taxpayers. Continue reading

Is Unnamed Partner on Wind Project Driving This New Dominion Regulation Rewrite?

The late Lt. Gov. Henry Howell (D) and Virginia’s most famous campaign slogan.

By Steve Haner

Without fanfare and without awakening the drowsy Capitol press corps, Dominion Energy Virginia dropped in legislation last week to set up a partnership on its most massive capital investment, the Coastal Virginia Offshore Wind project.

Just who that partner might be, what if any benefits that provides to Dominion’s 2.6 million Virginia customers, or whether it instead adds cost and risk for them, remains unexplained. The bill does describe the equity investor as “non-controlling,” leaving the utility in charge. Continue reading

The Box and the Snowball

by Joe Fitzgerald

There’s a box, and there’s a snowball.

The box is the support of the Bluestone Town Center. It is a well-constructed but beautifully decorated box, built on strong buzzwords. Affordable Housing, and Climate Change, and Dense Development are the shiny wrapping on this gift. The snowball of opposition rolling toward City Hall grows each time a post on social media begins, “I didn’t realize ….” Didn’t realize how big it is, how much traffic, how much impact on the schools, how far from the center of town it is.

The box is being built purposefully. Proponents on the Planning Commission and City Council who have not yet heard the presentation of pros and cons are publicly and privately adding items to the box. Their box is a container for their support of the project, and they will only add those things that bolster their case.

The snowball is built on surprise. With local journalism struggling, people find out in bits and pieces how large the thing is, how many cars and students it will add, how badly proponents have considered flooding, runoff, and blasting.

The box includes support that’s at best half-hearted from city staff. The recommendation from the Community Development staff reads less like approval and more like, “Well, we guess it’s OK.” The City Attorney outlines why the offers to mitigate school impact are illegal under current law and an administrative nightmare if the city changes the law to accommodate them.

The Harrisonburg Redevelopment and Housing Authority (HRHA) and the tax specialists will open their box at the Planning Commission meeting Tuesday, where they will explain how this is the greatest thing since the golf course. The snowball of citizens will attempt to deliver death by a thousand cuts. They don’t have the staff, they don’t have the legal help, and they don’t have elected and appointed officials who’ve already made up their minds. They only have the spirit of those who have throughout our history stood up and told their government it’s wrong.

Opponents have already been described in whispers as NIMBYs, or “not in my back yard.” I live two miles away, so it’s hardly in my back yard. But what if it were? Rezoning requests like this one are required to inform neighbors. The whole idea of zoning is to regulate what is built next to what. Homeowners’ defense of their surroundings should not be subordinate to what a planning commission or HRHA chair thinks is best for them and their neighbors.

As this proposal goes forward, I hope elected and appointed officials will remember that they serve the entire city and not just the preferences of a vocal political minority. For the people we elect and the people they appoint, the whole city is supposed to be their back yard.

Joe Fitzgerald is a former mayor of Harrisonburg. This column is republished with permission from his blog, Still Not Sleeping.

Consumers Be Wary When Energy Elephants Dance

By Steve Haner

First published this morning  by the Thomas Jefferson Institute for Public Policy. 

The Virginia House of Delegates is expected to vote this week to exempt certain Virginia manufacturers, which ones to be determined later, from the coming wave of energy costs created by Virginia’s rapid transition to unreliable forms of power generation. Continue reading

Virginia Democrats’ Rent Control Bills Would Make Housing Scarcer

by Hans Bader

In Virginia’s legislature, rent-control legislation has been introduced by five Democratic delegates and a Democratic state senator. Economists oppose rent control because it makes it more difficult for people to find decent housing in the long run. In a 1992 poll, 93% of those surveyed said rent control reduces the quantity and quality of housing available.

But Democrat-run Loudoun County is now asking the Virginia legislature for the power to impose rent control. DC News Now reported in December that “New policies could soon be introduced in Richmond at the request of Loudoun County. One would place a limit on rent increases.”

This is surprising, because even left-leaning economists mostly think rent control is stupid, as expressed by Swedish economics professor Assar Lindbeck. He said, “Rent control appears to be the most efficient technique presently known to destroy a city — except for bombing.”

In 1989, Vietnam’s socialist leaders reluctantly admitted that their policy of rent control had destroyed the housing stock of Vietnam’s capital city, which had been sturdy enough to survive years of American bombing during the Vietnam War. Vietnam’s foreign minister said, “The Americans couldn’t destroy Hanoi, but we have destroyed our city by very low rents. We realized it was stupid and that we must change policy.”

Yet State Senator Jennifer Boysko, who represents Virginia’s Loudoun County, has introduced SB 1278, a rent-control bill. It would allow cities and counties to adopt rent control ordinances, under which rent increases would be limited to inflation or less. Her legislation states that such ordinances “shall prohibit any increase in the rent by such landlord of more than” the “percentage increase in the Consumer Price Index,” and “may allow rent increases … by an amount not to exceed” that inflation rate. The same bill has been introduced in the Virginia House of Delegates by Democratic socialist Nadarius Clark and four other Democrats, as HB 1532. Continue reading

Projected $312 Billion Cost of Lost Earnings of Virginia K-12 Students due to Pandemic School Closures

Courtesy Eric Hanushek

by James C. Sherlock

Over $312 billion in present value.

That is the estimate published by Stanford’s Eric A. Hanushek of expected economic losses attributable to Virginia’s pandemic school closures.

Virginia students in the COVID cohort can expect on average 5.5 percent lower lifetime earnings.

History indicates that the economic losses will be permanent unless the schools get better. Just returning schools to their pre-pandemic performance levels will not erase the lost learning.

Recovering from the pandemic requires swift and decisive improvements to the schools.

That number is an estimate, but a scientific one. Dr. Hanushek has better credentials with which to make that estimate than perhaps any other economist in the world.

For perspective, the $312 billion present value of projected losses to the Virginia economy due to COVID school shutdowns represents about seven years of state revenue realized from Virginia sources in the 2021 and 2022 biennium.

Even the money pales by comparison to the developmental and emotional damage done to the children.

But feel better.

His estimate of similar losses to California exceeds $1.2 trillion. Continue reading

Who Kept Your Grocery Taxes High This Holiday Season?

by Scott Dreyer

Turkey, ham, chuck roast, pork loin, cornish hens, cranberries, potatoes, sweet potatoes, green beans, rolls, corn, cheese, flour, sugar, egg nog, hot chocolate mix.

Quick! What do these items have in common?

For one thing, they are popular food items, most not only year-long, but especially at the holiday season. Plus, if you are a Virginian, they are items you have been paying extra taxes on these past six months.

Doesn’t everyone pay a tax on groceries?

No. Five states have no grocery tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. A tax on groceries is called a regressive tax. According to, a regressive tax is “a tax applied uniformly, taking a larger percentage of income from low-income earners than from middle- and high-income earners …. With a regressive tax, the tax burden decreases as income rises.” In other words, imagine a low-income family with several children. Their grocery bill eats up (pardon the pun) a huge chunk of their total budget. In contrast, imagine you’re Sen. Mark Warner (D). With a net worth north of $300 million, and as the richest member of the Senate, his grocery bill relative to his total fortune is infinitesimal.

So what about Virginia?

When campaigning for governor, then-candidate Glenn Youngkin (R) pledged to end the state’s tax on groceries and some personal hygiene products (diapers, tampons, etc.). At that time, the state grocery was was 1.5%, and Richmond let local governments charge an additional 1% tax. So, when one spent $100 on groceries and some personal hygiene products, the tax was $2.50 total.

Working to keep his campaign promises, Gov. Youngkin urged the General Assembly to put the tax cuts into law. Amazingly, in our hyper-partisan environment, in February 2022 the House of Delegates voted 80-20 on House Bill (HB) 90, to end both the state and local grocery tax. In the state Senate, however, Republicans also tried to completely kill the grocery tax, but Democrats stopped it.  As a compromise, the state dropped its 1.5% tax but let local governments continue to charge a 1% tax if they wished. Continue reading

The Big Christmas Chill Was a Wakeup Call

by Bill O’Keefe

As temperatures dropped dramatically over the Christmas weekend, Dominion Energy’s advice to its customers — those who still had power — was to turn down their thermostats. Virginia was not alone. PJM, the regional grid management organization covering 13 states and the District of Columbia, made the same request because its gas plants couldn’t get enough fuel to meet the demand for home heating.

According to The Wall Street Journal, rolling blackouts were averted because PJM ordered some businesses to curtail power while switching some generators to oil. The large regions served by both the Tennessee Valley Authority and Duke Energy experienced rolling blackouts. And for the second year in a row, Texas faced a grid problem as wind power plunged and demand doubled.

The Wall Street Journal also noted that, “While there wasn’t a single cause for the power shortages, government policies to boost renewable energy snowballed and created problems that cascaded through the grid. There have been warnings about grid vulnerability for years but this Christmas proves that these warnings have not been taken seriously. The climate lobby blames climate change and greedy energy companies for this year’s problems but there have been colder Christmases — 1980 and 1983 for example. And, there have been colder Decembers that were survived without a grid breakdown or near breakdown.

The problems faced by utilities should be a warning and a reason for reassessment. Will Dominion heed that warning or will it continue on its present course? How will it prevent more serious problems as the demand for electrical power continues to increase and electric heat pumps are promoted and subsidized as responsible replacements for gas- and oil-fired furnaces?

That Dominion had to urge its customers to turn down their thermostats indicates that it did not have sufficient surge capacity to meet the demand caused by low temperatures. We need to know why. It could be the result of the 2019 decision to shutter all of its coal-fired capacity as part of its Net-Zero 2050 commitment and the General Assembly mandate to do so by 2024.
Continue reading

New Youngkin Tax Cuts Total $7 Billion By 2028

Governor Youngkin’s major tax proposals and how much they save taxpayers. Source: Secretary of Finance. Click for larger view.

by Steve Haner

The set of Virginia tax changes Governor Glenn Youngkin (R) has baked into his proposed 2023 budget amendments is far more extensive and involves substantially more tax relief than the descriptions he offered in his December 15 presentation. Continue reading