Tag Archives: Stephen D. Haner

SCC Rejects Most of Dominion Grid Proposal

The State Corporation Commission Thursday rejected in large part the highly-touted Dominion Energy Virginia proposal to rebuild its transmission grid, approving only the elements improving cyber and physical security.  Those were the least expensive and least controversial pieces of its application.

The 2018 legislation that stated major grid investments were in the public interest also re-stated the Commission’s charge to review them for prudence and reasonableness.

It did (here’s the order) and found this:

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Finally, The SCC Is Full Strength

The Honorable (Again) Patricia L. West (Click for larger view .)

Former Chief Deputy Attorney General and Circuit Court Judge Patricia West is heading to the State Corporation Commission and the only question it raises is, why did the Republicans feel compelled to ram her election through with such speed?

Was the coalition that fragile?

West apparently has not practiced law in front of the Commission on behalf of clients, and certainly has not lobbied the General Assembly on behalf of regulated clients.  Her campaign contributions are modest.  She has a long resume of leadership posts around state government, and if she has expressed strong opinions on any of the various regulatory controversies of the day, no one is aware.  But people forget most of what the SCC does is not controversial.

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Uh, Why Does JLARC Scare AG Herring?

Virginia AG Mark Herring

Just what does Mark Herring have to hide?

One of my goals during four years as director of administration for Attorney Generals Mark Earley and Randy Beales was to keep the Joint Legislative Audit and Review Commission busy somewhere else.   Having JLARC combing through your office asking inconvenient questions is no fun.

But had JLARC shown interest, I don’t think our response would have been quite the whine about partisanship that is coming from the current incumbent in that office.  “No one should be under any illusions about the partisan, election-year motivations that led to this review,” says Attorney General Mark Herring in an AP article in today’s Richmond Times-Dispatch.

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Transportation Revenue Focus of Concern Again

U.S. retail gasoline prices adjusted for inflation. Source: EIA . The blue line is the adjusted price, looking back into the 1970s. Note the peak just about when Virginia thought it wiser to tax a percentage of price rather than a fixed tax per gallon. Find the interactive version here: https://www.eia.gov/outlooks/steo/realprices/

In the middle of a booming economy, with many state revenue sources surging, flat transportation revenues were the focus of warnings Monday in presentations by Virginia Secretary of Finance Aubrey Layne and Secretary of Transportation Shannon Valentine.

“I think we are heading for a cliff,” Layne told the House Appropriations Committee.  “For the first time in our history, we’re seeing no increase in fuel tax revenue while vehicle miles traveled goes up.”

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Doctors Without (State) Borders, Coast to Coast

If taken ill traveling in New York or Texas, or any other of the 50 states, odds are you would not question the basic competence of the medical professionals who treated you there.  But consult that same doctor over Skype from within Virginia and state licensing laws might get in the way.

A bill introduced to the 2019 General Assembly, pending now in both the House and the Senate, would eliminate that basic barrier by in effect allowing Virginians to use telemedicine on a national basis, removing the requirement for a Virginia license if the physician or other provider is in good standing where he or she works.

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Tax Conformity Bills Buried in Rules Committee

The House Finance Committee will hold its first meeting of the 2019 General Assembly Monday morning, finally starting public discussion of Virginia’s response to a major federal tax overhaul from 13 months ago that will…

No! Belay that!  All House bills dealing with how Virginia conforms to that federal change, and what other policy changes might follow, have been assigned to the House Rules Committee, chaired by Speaker Kirk Cox and meeting whenever the Speaker decides for it to meet.   The one bill on the issue assigned to Finance is likely to also be referred to Rules tomorrow.

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Dominion Withdraws Renewable Tariff Effort

In the wake of the State Corporation Commission’s recent approval of a renewable energy tariff for residential customers of Appalachian Power Company, Dominion Energy Virginia has given up the application for its own more expensive proposal for a similar service to its residential and smaller business customers.

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I’m Shocked, Shocked To See Corporate Checks In Here! (Your Donations, Sir.)

Interesting to see Governor Ralph Northam channeling Claude Rains Monday, choosing the first day of the annual two-day General Assembly campaign finance feeding frenzy to highlight his support for a series of campaign finance proposals.

Campaign fundraising by state legislators and their pooled caucus accounts goes dark with the opening of the regular session today.   The days leading up to the deadline are filled with final receptions, dinners and endless email appeals, a fundraising push similar to the final stage before election day.

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Are You In…The Hugo Zone?

Are You In The Hugo Zone?

Delegate Tim Hugo (R-Centreville) is the point person for a state income tax proposal centered on less-than-full conformity with the federal Tax Cuts and Jobs Act.  It only helps a narrow subset of Virginia taxpayers, those in The Hugo Zone.  We will now try to take you there.  (If you want to imagine Rod Serling’s voice in your head, feel free.)

Under straight conformity, as proposed by Governor Ralph Northam, a taxpayer taking the federal standard deduction would be stuck with the state standard, as well.  Under straight conformity, deductions for local taxes on either return would be capped at $10,000.  Hugo, standing Friday with several key House Republicans, announced a bill to put Virginia out of conformity on those two points.

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Republicans Retreat From Trump Tax Successes

Virginia’s House Republicans on Friday rolled out proposed changes in the state income tax which backpedal from the signature accomplishment of President Donald Trump’s first year, his tax reform package which supercharged the economy.  They would conform Virginia’s taxes to the new federal law only in part (more details here).

One of the best policy provisions of that 2017 Tax Cuts and Jobs Act (TCJA) is a $10,000 cap on the deduction for state and local taxes (SALT).  No longer will the federal government subsidize out-of-control local and state taxes, and the state of Virginia should do likewise and cap the deduction for local taxes.

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Higher Standard Deduction Popular With Voters

The Northam Administration’s plans to spend most of the additional revenue created by federal tax reform may not prove popular if the public understands the alternative plans for real tax relief under consideration.

Three weeks ago, I complained that a poll from the Judy Wason Ford Center at Christopher Newport University didn’t ask the right questions, so the Thomas Jefferson Institute for Public Policy paid Mason-Dixon Polling & Strategy to add a private question to its recent poll of 625 Virginians.  We added just the one question to clarify one aspect of the debate, with the results announced today.

The poll was in the field nearing its end when Governor Ralph Northam released his budget, which did indeed call for spending most of the federal tax change windfall over the next several years.  One way he proposes to spend it is by expanding the existing state Earned Income Tax Credit into a program which pays cash grants to low-income Virginians.  Is that expanding an existing program?  Close enough.

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EITC Grants Do Nothing for Middle Class

Two examples showing results from the EITC Refund Calculator (Commonwealth Institute).  There is no benefit to taxpayers earning $30,000 or more.  An increase in the standard deduction benefits them instead.

The Earned Income Tax Credit (EITC) proposal that Virginia Democrats are pushing for passage in the 2019 General Assembly is being sold as a major financial boon for the middle class, but is it?

“Our working families making $54,000 a year or less are not going to see a big benefit from these federal tax changes,” Governor Ralph Northam told legislators on December 18. “Those are the Virginians who already see a disproportionate part of their paychecks go to taxes.  They deserve to keep more of their paychecks.”

Northam is off by more than $25,000.  Using the simple EITC Refund Calculator on the website of Commonwealth Institute for Fiscal Analysis, the EITC’s strongest proponent, it becomes clear the EITC grants will mainly go to taxpayers earning $25,000 or less, and the rhetoric about middle class families is misleading.  For taxpayers earning more than $25,000 the benefit from his proposal disappears quickly.   Continue reading

Bacon Bits: Rider U Screws U Know Who

Now that the State Corporation Commission has finally approved Dominion Energy Virginia’s Rider U, mandated by the General Assembly to force us all to pay for underground lines serving just a few customers, let me explain how perfectly this scheme put the company ahead of its customers.  (For case details, the Richmond Times-Dispatch has this good story, picking up some themes from an earlier Bacon’s Rebellion post.)

Set aside discussions of the “Strategic Underground Program” because the merits do not matter for this illustration.  Start with the information that Rider U is a stand-alone line item on your bill, a financial silo on Dominion’s books, with a guarantee that the utility will recover in full the cost of construction with a profit margin over time.  No risk to the shareholders.

Any benefit to the customers, and there will be some certainly, shows up as reduced maintenance and repair costs and fewer interruptions.  Those maintenance and repair costs are covered by the main portion of your bill, the base rates, outside the Rider U silo.   Say it’s a one-to-one ratio, and the $70 million spent putting lines underground saves $70 million over five years in repair costs.  The fewer interruptions also add base rate revenue outside the silo.

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Clean Virginia: A Powerful Swing That Misses

The full list of elements covered by Clean Virginia’s so-called “Dominion Tax”.  Click to see a larger copy.

Clean Virginia’s recent report accusing Virginia’s two investor-owned electric utilities of annually “taxing” their customers $254 or $89 respectively has a strong basis in fact, and beautifully packages the information, but ultimately is flawed and unfair.

Which is a shame, because the basic premise is correct.  The utility regulation process in Virginia has been badly subverted, the regulators disabled, enriching utility shareholders at the cost of shareholders.   Reading the entire report tells the story of how every well, and I endorse (and recognize) many of their recommendations.   But be very wary of that “tax” figure.

Read the Washington Post’s account and others uncritically and you will assume that you, average residential customer, could be paying $20 a month less to Dominion Virginia Energy or $7 less to Appalachian Power Company.  Those figures might be used in political conversation (such as by somebody’s opponent in a primary) or regularly cited by Dominion opponents in legislative debate.

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Fools Rush In: Coal Ash Scene Setter

Coal ash pond at Bremo Power Station. Photo credit: CBS 19

“I hate to give out directions without knowing what the cost is going to be.  There’s far too much of that in government.” 

That was Senator Frank Wagner of Virginia Beach expressing his deep reservations about various proposals to deal with the 27 million cubic yards of coal ash that Dominion Energy Virginia has collected over decades near its major power plants.  Wagner, who chairs the Senate Commerce and Labor Committee, was part of a joint subcommittee of that committee and its House counterpart that heard testimony  Monday but took no actions.

Legislation is coming.  Coal ash disposal in 2019 might turn into a replay of grid transformation in 2018, an omnibus electric utility regulation bill that takes on epic and expensive proportions as it moves through the legislative process.  It will also be a textbook example of what happens when legislators jump in to make billion-dollar decisions that could be made a better way.

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