Twenty days left in the fiscal year… and counting…

It looks like General Assembly budget negotiators made some progress yesterday on the budget. Hugh Lessig with the Daily Press reports that the Senate and House of Delegates conferees agreed upon a capital spending list of roughly $1 billion, mostly for new buildings and renovations. Lawmakers expressed optimisim that they would complete their budget work in several days.

Negotiators are still maneuvering, however, in anticipation of a follow-up session of the General Assembly to address transportation financing. As Lessig explains:

The Senate has set aside $339 million in a contingency fund to be spent on transportation – but only if the General Assembly were to adopt a separate statewide transportation plan that has an adequate and reliable source of cash.

House members have said that $339 million isn’t nearly enough. The Senate has refused to budge, saying the real debate on transportation will take place after lawmakers pass a budget. The tentative plan is to continue to stay in session and debate long-term financing solutions for highways and other transit needs.

I deduce from Lessig’s account, and the parallel articles in the Virginian-Pilot and Free Lance-Star, that this issue — how much General Fund money to funnel into transportation projects –is still on the table, although I find the accounts murky. If I understand the reports correctly, significant differences between the Senate and House still remain.

The outcome of the budget compromise will shape the battlefield, so to speak, for the special transportation session. If the final General Fund budget leans towards the Senate’s plan, the House will enter the transportation session hundreds of millions of dollars short of what it had wanted to put into transportation projects. That stark fact will pressure delegates into raising additional taxes to make up the difference…. which, of course, is the Senate’s intention.

It would be helpful if the Capitol Press Corps reporters would clear up this point. In any case, the logic of the situation will become immediately apparent as soon as the 2007-2008 budget is passed and discussion resumes on transportation.

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4 responses to “Twenty days left in the fiscal year… and counting…”

  1. Larry Gross Avatar
    Larry Gross

    As the tax/transportation issue has progressed over the last few weeks (months), it would seem that there has been more than adequate time for a pro-tax clamor to spring up with Va. taxpayers. You know.. the kind where folks tell their legislators that if they don’t raise their taxes, they’re going to vote them out of office. 🙂

    Heck.. for that matter… even front-page words warning of a “government shutdown” does not seem to have mesermized the public unless one wants to count yawns.

    So.. I wonder… what magic potion the Senate guys are using on the House Delegate guys to convince them to agree to raise taxes..

    Inquiring minds would like to know…..

  2. Anonymous Avatar

    I agree there is no majority or plurality of public sentiment for a tax increase. The case has not been made. That is why the Senate backed down.

    That does not mean that we stand by and let the House apply yet another small band aid in the form of a two-year cash infusion into transportation. The debate is not taxes vs. general fund cash, the debate is between doing something that will provide additional money for two years (until the next election) or something that will produce enough revenue to kick up the program for a decade or longer. The House has all the political cliches on this side, but economically its position is downright stupid and relies on distracting the voters with fools gold. Once the smoke clears in 2008 we’ll be right back where we are now (and every delegate knows it.)

    If the surplus makes it silly to raise taxes, it makes it equally silly to borrow and spend for roads, as well, which at its heart this the House plan.

    On another sideline, just read the AG’s actual opinion, and I don’t see how he could have written anything else and kept any credibility as a lawyer. Missing from the press accounts is the bolded, underlined sentence (which I’ve never seen in an official opintion) about how this means the GA needs to get it together by July 1.

  3. Toomanytaxes Avatar

    5:07 There may well be a need for more transportation funds, but I find it very telling that all who support a tax increase refuse to address the findings of the state auditor that: 1) VDOT has NO internal cost controls; and 2) the Commonwealth Transportation Board funds projects without regard to their relationship to state transportation plan (i.e., the CTB funds whatever can be lobbied through it). Why shouldn’t these major flaws be fixed before the GA tries to dig deeper in taxpayers’ pockets? Reform transportation first; then let’s talk about revenues.

    I cannot imagine a corporation that had an auditor’s findings that it lacked cost controls and its management funded capital programs without regard to their relationship to the company’s overall business plan would be able to borrow funds or raise equity. I strongly suspect that not a single reader of would lend or invest a dime to such a corporation. Would you? Yet, many people feel that taxpayers should be held to lesser standards? Why?

  4. Larry Gross Avatar
    Larry Gross

    re: VDOT … standard Corporate Accountability practices NOT!

    This is the most bizarre part of this issue to me but I do wonder how much the average taxpayer in Virginia is aware of the very serious flaws that have been clearly shown to exist at VDOT. This is the $64 question.

    In other words.. is the average Va. opposed to higher taxes for transportation or are they opposed to higher taxes that VDOT will then use the same way that they have been? I suspect the former.

    But how does that explain the Senate guys(gals) who have read these same reports from the Va. State Auditor and JLARC – damming reports.. and yet… they still want to raise taxes …for VDOT.

    I would like to hear from the leaders of higher taxes in the Va GA actually address the VDOT issue in concert with their advocacy for higher taxes because without reform… we are essentially talking about raising folks taxes so that VDOT can continue…(in my mind) waste, fraud and abuse…. with that new money.

    I’ll finish by cutting VDOT .. SOME slack. We have a political transportation funding enviroment in Virginia… yes I know this comes as a shock to some folks … but VDOT has had LOTs of help in this regard.

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