Legislative Newsletter - February 2, 2010

Number 3

Calendar for 2010 General Assembly Session

February 16     “Crossover” day of bills
February 21     House and Senate versions of the budget released

OVERVIEW

       Governor Bob McDonnell has laid out his legislative package, which includes budget amendments and nearly two dozen pieces of legislation focused on job creation and economic expansion. The plans include increasing dollars in the Governor’s Opportunity Fund and creating business-friendly income tax credits. Meanwhile, he also has indicated that education, health care and VRS are areas that may be targeted for additional reductions as the legislature shape changes to the current fiscal year and next bienmium budgets.

       Members of the House Appropriations and Senate Finance Committees have just three weeks to craft their respective spending plans, as they are due to release their budgets on February 21. At this point, there is no definitive notion as to the direction either committee will go in forming their plan, as they are challenged with compiling budgets that must deal with an additional $2 billion revenue gap on top of the $2 billion in reductions proposed in the budget that former Governor Kaine introduced in December. That proposed plan relied on an increase in the income tax to generate $1.6 to $2 billion to cover the amount that localities would lose through his removal of a state appropriation to localities for “car tax” reimbursements, a proposal that has been rejected by the legislature.

       The money committees have received from members of their respective chambers numerous budget amendments requesting ­­­­hundreds of millions in new or shifted dollars. Most amendments submitted were in the public safety and health/human services areas, which  may be where attempts are made to limit the impact of additional reductions. While it was disappointing that the introduced budget did not include more flexibility in or relief from meeting state requirements, there are some interesting budget amendments that seek to assist localities:
*The requirement to review the comp plan once every five years would be suspended.
*Certain reporting requirements for CSBs would be reduced.
*Per diem payments for local/regional jail prisoners would be restored to FY10 levels.
*A local $25 fee as part of the costs in each criminal or traffic case would be authorized.
*Amendments that would provide flexibility to school divisions include ones that would 1) allow school divisions to increase class sizes by one, or lower the number of FTEs per 1,000 students than currently is required; 2) waive local match requirements for certain education programs for FY11 and FY12; 3) allow school divisions to count an instructional aide as 0.5 in meeting the pupil/teacher ratio for grades K-3; and 4) provide Lottery Proceeds Fund to localities as a single block grant amount.

LEGISLATION

       We’re in “crunch time” for consideration of legislation by House and Senate committees, as the crossover day of bills is only two weeks away. Accordingly, it promises to be a hectic time as committees work to clear bills from their dockets. The Senate Agriculture Committee had a busy day on Monday. It approved SB 395 concerning the recently approved stormwater management regulations. The bill provides that the technical criteria and local program provisions of the regulations shall become effective within 280 days after the establishment by the (EPA) of the Chesapeake Bay-wide (TMDL ), but in any event no later than Dec. 1, 2011. Similar action is expected in the House when HB 1220 is considered.

       The committee reported a substitute version of SB 347 that directs the Center for Rural Virginia to facilitate a “rural enterprise opportunity task force” to develop strategies that expand and promote economic opportunities for the agriculture industry. Earlier versions of this and a House counterpart would have restricted local authority in regulating farm business activities.

       Finally, the Committee will consider a substitute version of SB 235 that directs the Waste Management Board to develop a schedule of annual fees paid by solid waste facilities that cover 75% to 100% of the state's costs of processing permit applications and inspections/enforcement activities. The current fee structure covers only about a third of the costs. The original version of the bill would have assessed operators or owners of solid waste management facilities a $2 tipping fee on solid waste treated or deposited in their facilities to pay for the state program.

       The Senate Local Government Committee today spent a lot of time discussing bills of interest to localities. Though easily approved, SB 632, which stipulates that cash proffers be collected at the time of certificate of occupancy, faced numerous questions from committee members about how delaying proffer payments would affect existing agreements concerning payment. The building community sought the bill to provide some relief to the struggling housing market. The House companion, HB 374, was approved last week.

        SB 64, would have greatly restricted the authority of localities that have agreements with VDOT to remove illegal signs from rights-of-way. The bill was the subject of numerous discussions, revisions and intense lobbying by interested stakeholders. Ultimately, local government representatives were successful in limiting the reach of the bill’s provisions to provide that any employees and any volunteers who remove such signs comply with existing law, and that any sign wrongly confiscated be held for 10 days to allow the owner to reclaim it. We expect the same language to be offered next week for the House companion, HB 553. Finally, the Committee defeated SB 448, which would have allowed any locality to enact an ordinance prohibiting the use of alternative onsite sewage systems. Legislation approved last year barred localities from prohibiting installation of such systems.

       While the Senate has approved bill SB 280 that would remove the cap of 4% for the county meals tax and allow counties to impose the tax or increase the rate by a majority vote of governing body, a similar House measure was defeated. HB 1138 would have allowed counties to enact or increase up to a 4% food and beverage tax without a voter referendum, with the revenues from such tax to be used to reduce the real property tax rate.

            The House overwhelmingly has approved HB 57 which prohibits localities from imposing the BPOL tax if it did not impose it as of the first of the year, and increasing BPOL tax rates in the future. The vote was 88 to 8. The House Finance Committee has approved HB 570, which changes the burden of proof from the taxpayer to the assessor when a taxpayer appeals the assessment of real property to a board of equalization or to a circuit court. The bill will be on the House floor for a first vote on Wednesday.

Here’s an update on locally-requested legislation

HB 436, which authorizes donations by localities to non-profit entities that promote energy efficiency or that provide energy efficiency services, is up for a final vote on the House floor Wednesday. The Senate companion, SB 291, has passed the Senate. The bills were requested by Charlottesville and Albemarle.

HB 751, which revises the City of Charlottesville charter to eliminate the requirement that the clerk of council reside in the city, will be in a House subcommittee Wednesday. The Senate counterpart, SB 292, has passed the Senate.

SB 172 , which adds Nelson County to the list of counties where the unposted maximum speed limit on nonsurface treated highways (gravel roads) is 35 miles per hour, has passed the Senate. Finally, the Senate Transportation Committee will consider SB 285 next week. This bill requested by Albemarle would lessen the penalty on localities that use unpaved road funds for other secondary road improvement projects.

General Assembly Contact Numbers for David Blount, TJPD Legislative Liaison

PHONE: 434-979-7310 x350
EMAIL: dblount@tjpdc.org (preferred) or dblount64@hotmail.com (alternate)