Legislative Newsletter - February 5, 2008

Number 4

Calendar for 2008 General Assembly Session

February 12     “Crossover”day—last day for house of origin to act on bills

February 17     House and Senate budgets released

BUDGET OVERVIEW

      Lawmakers are preparing to grapple with an ever-growing budget dilemma. A reduction in the revenue estimate, to be released within the next week, likely will mean further cuts in state spending, including in aid to localities. A reduction in the current fiscal year has a ripple effect into the biennial budget, and there have been suggestions that the total effect could be as much as a $1 billion dollar reduction in revenues. The governor has indicated that a larger withdrawal from the state’s revenue stabilization (“rainy day”) fund could be warranted; he already has proposed seizing $260 million from the fund’s nearly $1 billion balance. Administration officials were working over the weekend to analyze January revenue numbers. The House and Senate money committees will have a matter of days to put finishing touches on their versions of the budget after receiving revised revenue projections from the Kaine administration.

LEGISLATION

Finance Committee Issues:

      After more than an hour of testimony, discussion and a series of motions and votes, the Senate Local Government Committee last week amended, reported and re-referred a substitute version of SB 768. The substitute version of the bill still repeals local authority to accept voluntary cash proffers from new residential projects. It also limits the ability to accept off-site non-cash proffers and limits the amount of impact fees a locality can impose to an unscientific $5,000 per unit. The committee also voted to delete the provisions that require the local imposition of a grantors-type tax on the sale of every home (thus further reducing the amount of revenue that might be available for critical infrastructure). A motion to carry over the bill for the year failed on a 7 to 7 vote. The bill is slated to be considered on Wednesday morning by the Senate Finance Committee. As this bill poses such a drastic shift in policy by attempting to undo 30 years of proffer authority in a mere 30 days, local governments are asking that legislators carry over this bill for the year so that local governments can have an opportunity to fully analyze the  implications of the bill.

      Also slated to be heard in Senate Finance Wednesday morning is SB 269, which extends to state police and employers with fewer than 100 law enforcement officers, the overtime compensation coverage now allowed for larger police departments. The bill poses a fiscal impact on some localities.

      The past two years, the General Assembly has changed state law to require more information on tax forms and to move back the time for advertising the tax rate. This year, a new crop of proposals to cap property tax rates or increases, to require separate public hearings on the tax rate and budgets with 30 days in between, and others have been proposed. All would make it harder to generate additional revenue at the local level. The Senate Finance Committee has sent its bills on these topics to a special subcommittee to meet in the offseason to study the implications of the Senate measures, while the House bills are expected to be considered in a House Finance subcommittee on Wednesday afternoon.

Smoking Legislation:

      The Senate has spent time the past week debating smoking legislation. Tuesday, the Senate voted 29 to 9 to approve SB 202, which allows localities to adopt ordinances with provisions relating to smoking in restaurants that meet or exceed those established in the Virginia Indoor Clean Air Act. Current law provides for the designation of non-smoking areas in restaurants with seating capacities exceeding 50 people. It also approved two other broader bills that would prohibit smoking in restaurants and in many indoor public places. The bills are expected to face opposition in the House, which has not endorsed smoking prohibitions this session.

Pay Day Loans:

      House of Delegates leaders this week unveiled a compromise to address pay day loans. Under the proposal, there would be a 36% cap on the annual interest rate lenders can charge for such loans, but the legislation allows lenders to charge other fees similar to those already in place. Borrowers would have twice as long to repay the loan than the current practice of having them due on the borrower's next payday. A database also would be put in place to track the loans to make sure an individual couldn't have more than one at a time and no more than five per year. The House Commerce and Labor Committee approved the proposal Tuesday afternoon. The Senate Commerce and Labor Committee held a hearing yesterday afternoon on the many pay day loan bills before it, with action in that committee expected next week following review by a special subcommittee.

Other Bills:

      The House has approved HB 922 that increases the “$4-for-life” fee to $4.25, with the $1.6 million expected to be generated by the additional 25 cents targeted for helping defray costs associated with certification and recertification training of emergency medical services personnel. This bill is a recommendation of a joint study this past year on incentives to recruit and retain fire and rescue squad volunteers.

      The House also approved a small increase in the amount paid by localities that have voluntarily entered agreements with the Department of Forestry for fire prevention and suppression. Localities currently pay the agency, upon billing and proper documentation, an amount equal to five cents per acre for each acre protected, an amount that has remained unchanged for 20 years. HB 1115 provides for an increase to seven cents per acre next year, and to nine cents per acre the following year.

SB 76 was debated on the floor of the Senate Tuesday afternoon after having been delayed for more than a week. The bill makes several changes as to the process and procedures afforded to police officers under the procedural guarantee act, including setting forth specific procedures for the questioning of officers and the conduct of a disciplinary hearing. After a lengthy debate, the bill was recommitted to the Senate Courts of Justice Committee.

      The House General Laws Committee is considering legislation addressing legal representation for soil and water conservation districts.  An expected amendment to HB 119 would require local government attorneys, rather than the Attorney General’s office, to represent these entities, a move that could cause conflicts between them and the local governments in their areas.

Locally-Requested Legislation:

      SJR 17 was approved by the Senate Rules Committee. This resolution, introduced at TJPD request, calls on the Office of Comprehensive Services to revise or replace the service fee directory that deals with information about residential services. The resolution was amended to provide for an interim report by OCS in 2009, with a final report due to the 2010 General Assembly. It awaits action on the Senate floor. Meanwhile, it appears that identical resolutions in the House will not be taken up for consideration by the House Rules Committee.

      Meanwhile, Senate Local Government approved SB 268, which allows the City of Charlottesville to adopt provisions in its zoning ordinance that would provide, in rezoning or special permit cases, for the construction of affordable units or for the payment of cash in lieu of units. A companion measure, HB 883, will be heard in a House subcommittee on Thursday morning.

General Assembly Contact Numbers for David Blount, TJPDC Legislative Liaison

804-644-3702 (phone)

804-783-8226 (fax)

979-7310 x350 (Charlottesville voicemail)

(Richmond email)