Monday, February 18, 2008
Different budget plans win approval
Two different proposals offset revenue shortfalls and provide for mental health services.
Related
roanoke.com/politics
RICHMOND -- The General Assembly's budget committees on Sunday approved competing plans to offset $2 billion in revenue shortfalls, setting the stage for negotiations that will determine how Virginia balances its books and whether Gov. Tim Kaine can fund some of his signature initiatives.
The Republican-controlled House Appropriations Committee cut funding Kaine had sought to expand pre-kindergarten eligibility and provide premium subsidies to uninsured Virginians. The panel also relied less heavily than Kaine on the state's "rainy day" reserve fund to balance the current budget, partly by using debt rather than cash for some transportation and building projects.
The Democratic-controlled Senate Finance Committee was more friendly to Kaine's priorities in crafting a plan to balance budgets for the remainder of the fiscal year and the following two years. But, in a rare display of discord, Senate Republicans voted against the Democratic plan, charging that it put Kaine's new spending priorities ahead of core government services.
Both budgets provide $42 million in new spending for mental health services, partly to address problems exposed by the Virginia Tech shootings. But, in a reflection of the austere climate, neither house proposed funding for nonprofit museums, parks and cultural attractions that rely partly on state funds.
Each house will vote on its budget bills later this week, and leave it to negotiators from the two chambers to reconcile differences between the proposals.
"There will be a lot of differences to resolve," Kaine said Sunday night.
A slumping economy and sluggish revenue growth have produced a $980 million shortfall in the current budget, which expires June 30. Kaine's administration issued a revised revenue forecast last week indicating the state will collect $1 billion less than projected in the $78 billion budget Kaine proposed for the next two years.
Kaine proposed spending cuts and other cost-saving measures and a $423.5 million withdrawal from the rainy-day fund to help balance the current budget. The Senate largely supported the withdrawal. The House proposed taking just $225 million from the reserve fund.
"As I and others have said since last October, we will not use the rainy-day fund to support new programs," said Del. Lacey Putney, I-Bedford, chairman of the House Appropriations Committee.
In response to the mushrooming shortfall, Kaine scaled back some of his own initiatives and proposed reducing scheduled pay raises to state workers and teachers, cutting aid to localities and curbing spending in most state agencies by 3 percent.
Kaine raised concerns Sunday about the House proposal and expressed dismay Sunday night over the party-line vote in the Senate Finance Committee.
The governor and House budget-writers continued a dispute over education funding that began Tuesday, when Kaine proposed cutting about $55 million in school construction grants and shifting about $165 million in lottery proceeds from school construction to basic aid for education.
Both houses proposed restoring at least some of the school construction funding, but Kaine said the House budget recalculates the state's school funding formula and leaves less funding for basic education aid than his proposed spending plan.
The two committees also took different approaches on pay raises for teachers and state employees. The House plan funds 2 percent raises in the first year of the new budget and sets aside seed money to fund salary increases in the second year of the budget. The Senate plan calls for 2.5 percent raises in the second year of the budget.
Kaine sounded an upbeat note about his initiative to expand pre-kindergarten, even though the House refused to broaden income eligibility criteria for the program that serves low-income 4-year-olds. Both budgets contain more money for the program.
"I was expecting a goose egg on that one," Kaine said after noting that the House proposed a $25 million increase for pre-kindergarten over two years.
House Speaker Bill Howell, R-Stafford County, said the House spending bills "establish clear and compelling priorities and make substantial progress in addressing the everyday issues" important to Virginia taxpayers. The House budget panel approved its budget plan on a unanimous vote.
The Senate plan was more divisive, reflecting the sharp partisan split in the chamber. Senate budgets typically reflect broad bipartisan consensus, but the plan advanced by the new Democratic majority did not sit well with GOP veterans on the panel.
Sen. Charles Colgan, D-Manassas, the chairman of the Senate Finance Committee, said his panel worked toward "striking a balance between funding core services in a way that is thoughtful and responsible, and providing critical investments in our future."
In addition to supporting Kaine's initiatives, the Senate budget also includes a gasoline tax increase of 1 cent per gallon in each year of the new budget. The Senate last week passed a bill to increase the tax by 5 cents per gallon over five years.
Senate Republicans back an alternative budget proposal that asks state agencies to make 6 percent across-the-board spending cuts to save $130 million. It makes smaller reductions in public safety and higher education funding.
"We are not asking agencies to do any more than what families in Virginia are now being faced with every month, and that is to live within their means and balance their budgets," said Sen. William Wampler, R-Bristol.
Del. Onzlee Ware, D-Roanoke, who sits on the House budget panel, said the plans released Sunday merely reflect starting points in a long negotiating process.
"The real work will be done in conference," Ware said.
