Budget Progress

Yesterday the Senate passed the Budget. The House will be meeting today at 12 noon to go over the budget.

I have included an article from the Richmond Times Dispatch highlighting the progress below.

Senate OKs state budget

Two-year plan moves to House as deadline of June 30 looms

BY JEFF E. SCHAPIRO
TIMES-DISPATCH STAFF WRITER
Tuesday, June 20, 2006

Having tarried 159 days, Virginia lawmakers suddenly are in a hurry to pass a budget.

The state Senate yesterday -- the 160th day of the struggle with the House of Delegates over taxes and spending -- needed only 21 minutes to approve a compromise budget that ducks the issue that caused the impasse in the first place: new dollars for transportation.

The two-year, $74 billion plan, approved by the Senate 37-0, is on the House floor today.

The budget includes pay raises for public employees, many of whom live in the Richmond area; additional dollars for public education and social services; about $1 billion for construction, most of it on college campuses; and what may be the Virginia equivalent of controversial congressional earmarks -- almost $40 million for local cultural and tourist attractions.

In a separate vote, senators approved, 24-9 with two abstentions, a long-sought rollback of the estate tax, effective July 2007, as well as a $75 million cap on tax breaks for Virginians who pledge to never develop their open land.

To assure an uninterrupted flow of services to taxpayers, the General Assembly now has 10 days to complete a budget.

Between today and June 30, when the current budget expires, three events must occur beforethis chapter of the 2006 fiscal saga closes: the House vote; vetoes and revisions by Gov. Timothy M. Kaine; and another legislative session, probably June 28, to act on Kaine's recommendations. Only then can Kaine sign the budget into law.
"This has not been an easy exercise, as you know," Senate Finance Committee Chairman John H. Chichester, R-Northumberland, said in brief remarks to the Senate.

The protracted overtime that forced a three-month delay in enacting a budget will continue into summer, if not longer, with legislators attempting to fashion a long-term fix for highways and mass transit.

"It won't get done," predicted Sen. John Watkins, R-Powhatan. "That pot is going to have to boil for about two more years."

To cobble the 2006-08 budget, the Senate and the House agreed to put off transportation financing until next month or later. But differences endure: The Senate favors about $750 million in new taxes, while the House wants to use a chunk of the $1.4 billion surplus and issue more bonds, which would be repaid with interest.
Sen. Jay O'Brien, R-Fairfax, said the transportation fight will be guided by the 2007 elections to decide continued Republican control of the General Assembly.

"It will be interesting, as we get close to the election, how any single person changes his views," said O'Brien, an opponent of higher taxes who may be vulnerable to a

Democratic challenge in his traffic-clogged Washington suburb.
The compromise budget is outlined in a 379-page report, which many senators -- perhaps out of frustration over the protracted stalemate that dates to the chilly days of January -- only briefly perused.

Chichester depicted the budget as a victory for the Senate because it embraces many of the chamber's priorities, including a cash-only construction program and use of surplus funds for one-time expenses.

Sen. R. Edward Houck, D-Spotsylvania, a budget negotiator, said the plan substantially boosts appropriations for three programs that the House wanted to cut to free dollars for its road-and-transit plan: public schools by $51.7 million, higher education by $25 million and human services by $26 million.

Those increases, said Houck, underscore the Senate's claim that investments in education and social services -- programs on which Virginians depend daily -- are threatened if they have to share dollars for transportation projects that are bankrolled and built over many years.

"Yes, transportation is important, but not at the expense of education, health care and other essential services," Houck said.

Contact staff writer Jeff E. Schapiro at jschapiro@timesdispatch.com or (804) 649-6814.

This story can be found at: http://www.timesdispatch.com/servlet/Satellite?pagename=RTD%2FMGArticle%2FRTD_BasicArticle&c=MGArticle&cid=1149188611364&path=%21news&s=1045855934842