Weekly Column: Good News & Bad News in Governor's Amendments

The following is my column that will appear in the Mt. Vernon Gazette, Springfield Connection, The Prince William Times, The Fort Hunt Herald, and Potomac Local in the week of April 12, 2020.

Good News & Bad News in Governor's Amendments

                On Sunday, Governor Northam signed the remaining bills that were pending for action, proposed 140 amendments to the state budget, and also 101 amendments to bills.   As of today, the plan is for the House of Delegates to meet outdoors and the Senate of Virginia to meet in a tent behind the Virginia Science Museum in Richmond next Wednesday at noon for our “Veto Session.” 

                First, the good news for our area.  The language requiring the Virginia Department of Rail and Public Transit to study extending the Blue Line to Lorton, Woodbridge and Potomac Mills is still in the budget.  In addition, the authority and appropriations to fund the Prince William County Public Defender’s Office is still in the budget and cannot be amended further at this point.

Weekly Column: State Legislature Must Make Tough Decisions

The following is my column that will appear in the Mt. Vernon Gazette, Springfield Connection, The Prince William Times, The Fort Hunt Herald, and Potomac Local in the week of April 5, 2020.

State Legislature Must Make Tough Decisions

Instead of reporting on the accomplishments of the General Assembly’s 2020 session, in recent weeks I have chosen to provide information about the COVID-19 crisis and its impacts.  The worldwide coronavirus pandemic is likely to change much of what state legislators passed earlier this year.  Many measures are in limbo, especially the state’s budget.  The legislature will reconvene on April 22 to consider budget changes and vetoes that Governor Ralph Northam may propose. 

This week, Governor Northam announced that he is putting all new spending in the state’s new two-year budget on hold.  Therefore, it appears that when we reconvene, we will consider proposed amendments to implement his proposals, pending economic analyses, projections and decisions on how the state can use the $3 billion in federal stimulus dollars.

Weekly Column: Budget Compromise, Child Support Deadbeats & Session End Approaches

The following is my column that will appear in the Mt. Vernon Gazette, Springfield Connection, The Prince William Times, The Fort Hunt Herald, and Potomac Local in the week of February 18 2019.

It is hard to believe, but the last week of the General Assembly has arrived and we hope to gavel out by this coming Saturday.  This past week was very busy as we tried to complete work on bills from opposite chamber and negotiated amendments to the budget. 

First, the Governor and the money committees announced an agreement regarding tax conformity and the revenue side of the budget.  The compromise provides a $110 refund for each tax return (individual or joint) this year.  From 2020 to 2026, it increases the standard deduction at the state level by $1,500 for individuals and $3,000 for joint filers – resulting in $86 in savings for individuals and $172 for couples.  The bill also removes the $10,000 cap on itemized deductions for state taxes.  Given the state income tax is only 5.75%, the tax relief afforded is about $57.50 for every $1,000 of additional mortgage interest, state or local property taxes paid over and above $10,000.  

I was not happy with this proposal for several reasons.  First, it takes about $450 million per year out of the state budget which could fund desperately underfunded General Fund (non-transportation) priorities such as secondary education, higher education, childcare, healthcare, safety net, environmental protection, parks, and public safety.  Second, most of the people receiving the bulk of these cuts are already receiving big federal tax cuts while we run the biggest deficits in United States history instead of following the Governor’s proposal to target modest tax relief targeted to low wage working Virginia families.  This week, negotiators will attempt to finalize the expenditure side of the budget. 

Next, my legislation to modernize child support collection continued to move through the process.  There is over $2.4 billion of delinquent child support in Virginia.   When child support goes unpaid with low income families, it is often paid by taxpayers through the state’s Temporary Aid for Needy Families (TANF) and it is recovered through the Commonwealth’s Department of Child Support Enforcement (DCSE).  In the last five years, child support deadbeats have begun to seek employment with “gig economy” companies as independent contractors such as Uber and Lyft who are exempt from child support withholding.  My legislation would change that and passed the Courts Civil Subcommittee by one vote.   

My legislation to change the Town of Dumfries Town Charter to move elections from May to November passed the full House and Senate.  There is no need for taxpayers to fund separate elections, especially when they result in much lower turnouts.   

The legislation I introduced to create a pilot project to provide Fairfax County with an additional tool to fund underground utilities on U.S. 1 passed the House Commerce and Labor Committee and should be up for a final vote this Tuesday.   

Next, my bill to give Fairfax County authority to fine retailers for rogue shopping carts after refusing to pick them up for 10 days failed in a House subcommittee on a tie vote.  Several Mount Vernon and Springfield residents testified about the disruption loose carts cause in neighborhoods, sidewalks, and the environment – I have now removed over 250 shopping carts from Little Hunting Creek alone.  We will try again next year. 

Also, my bill to enhance prohibit cars from illegally passed other cars by using bike lanes and creating a new serious traffic offense for seriously injuring a cyclist or pedestrian while distracted passed the House Transportation Committee, but was killed by the House Courts of Justice Committee.  Many rural members do not understand the need for better cycling safety rules. 

My legislation to creates consequences for destroying public records to avoid a Freedom of Information Act passed, but only after fines for violating the state’s public meetings law were removed.  I am moving the bill into a conference committee to negotiate a compromise because the closed meeting rule is routinely abused.   

Finally, on Wednesday, I held my annual Facebook Townhall.  Over 56 constituents posted questions and about 1,500 have viewed the 90-minute town hall.  You can watch the recorded version on my official Facebook page at www.facebook.com/surovell.   

Please contact me at scott@scottsurovell.org if you have any questions.  It is an honor to represent you in the Senate of Virginia.

Weekly Column: Virginia Faces Another Shortfall

The following is my column that will appear in the Mt. Vernon Gazette, The Mt. Vernon Voice and The Potomac-Stafford Local in the week of September 7, 2016.

Virginia Faces Another Shortfall

Last month, Governor Terry McAuliffe announced that state revenues were lower than assumed in our state budget passed earlier in the year.  This creates a series of difficult choices. 

In July, the Governor announced that the budget ended on June 30 and came in $266 million short of expectations.  Last month, the Governor announced that due to continued lagging revenues, the current budget was projected to be short by $850 million this year and $630 million in next fiscal year.  This creates a total $1.7 billion from what was budgeted last session.   

There are many causes of this.  First, the lingering effects of the Sequester – automatic spending cuts by the federal government – continue to stall the Northern Virginia and Hampton Roads economies.  Cuts to defense spending alone took $9.8 billion and 115,000 jobs out of the Virginia economy.  Income tax collections are down, even with 2.6% job growth last year, because new jobs do not pay as much as the jobs we have lost.  Commercial office vacancies are still at record highs in Northern Virginia. 

Finalizing a State Budget - Not Pretty

The new proposed amendments to the state budget are now up online.  You can see them here:

Proposed Senate Amendments to House Budget

The biggest issue is that revenue collections came in well below what was expected largely due to lagging capital gains tax revenues.  The overall shortfall is expected to be about $1.6-$2.0 billion.

What follows below is my initial impressions of what has changed versus Governor McDonnell's introduced budget.  Don't kill me if there are a couple mistakes.

Richmond Stuck On a Bad Budget

The press has started to heat up over the budget situation.  I was one of twenty-one delegates to vote "no" on the House Budget (HB30).  It has now been rejected by the State Senate.  Here are some of the reasons why I voted "no."

Earlier this week, I appeared at a press conference with my colleagues Delegate Patrick Hope and Senator Adam Ebbin in our press conference to discuss the problems with the current budget.  You can view our Press Release here and watch video of the press conference here:

• The Governor's and House Budget's transportation funding proposal in the budget is a gimmick.
• Our secondary education spending levels are still 10% below their peak in FY 2009.
• The proposed budget is laden with bad choices and special interest pork.
• The budget does not reflect the priorities of my district of the Commonwealth of Virginia given our current budget environment.

The Counterintuitive Politics of Poverty in Virginia

The New York Times ran a story about the geography of the receipt of government payments in the country.  It includes Social Security, Medicare, Medicaid, Income Support (food stamps, disability, EITC), Veterans Benefits, and Unemployment Insurance. 

You can see the interactive chart here.  The accompanying NYT article is here.

I zoomed the overall government benefits charts of Virginia for kicks, ran it from 1969 to 2009, and then pieced the pictures together so we could see them together for comparative purposes.  If you click on the picture at the right, it will blow up so you can see it more easily. 

If you're really curious, you can click on individual charts an isolate Social Secuirty, Medicare, Medicaid, etc. by jurisdiction.

As a preface, let me say that it drives me crazy when people lump all of Fairfax County together as one jurisdiction.  Fairfax County is now larger than eight states.  Looking at the County as a whole always masks the issues in my district and it is really frustrating when this kind of information goes out.  The same thing is true for Prince William County which has its pockets of have's and have not's notwithstanding its relative wealth overall. 

For example, I was recently given data by the state that said 15% of my constituents are receiving Medicaid.  Delegate Kory's district (near Bailey's Crossroads) is at 15%.  The rest of Fairfax County is between 3% and 10%.

In terms of Virginia, there are probably different trends at work. Looking at the individual charts, the drivers are mainly increased percentages of Social Security, Medicare, and Unemployment Insurance. 

Medicaid on the Chopping Block in 2012?

The Governor is set to announce his budget sometime in the next ten days.  The word from Richmond is that we have an approximate $1 billion shortfall.  One of the big drivers of that is medical inflation reflected in our Medicaid budget.

Medicaid is a federal-state health insurance program for low-income and disabled people.  It is also the only provider of long-term nursing care for many Americans, since Medicare coverage and coverage by most private insurance policies is quite limited.  Virginia has one of the most restrictive programs in the United States - you have to be very poor to be eligible.  Most rankings put Virginia at 48th in Medicaid expenditures and 7th in per capita income.  In other words, we are a relatively wealthy state and we do not help the poor much. 

A significant portion of Virginia's Medicaid population are children, elderly and the blind.  Here's how Virginia's 881,075 Medicaid recipients played out in 2008:

• 480,392 Children
• 177,755 Blind & Disabled
• 140,716 Adults
•   82,212 Elderly

Bipartisan Group Legislators Demand Restoration of Metro Funding

Earlier this week, a bipartisan group of 24 Northern Virginia legislators sent a letter to Virginia's Congressional Delegation demanding the restoration of $150 million of federal Metro Funding.

I previously blogged about this here:

The Dixie Pig: Congress Slashes Metro Funding

Congress' proposal to breach a bipartisan agreement regarding Metro funding is an unjustified attempt to torpedo Northern Virginia infrastructure.

You can read the release and letter below.

Letter to Virginia's Congressional Delegation Demanding Restoration of Metro Funding - 2-21-11

Politifact Agrees House Budget Cuts Education

Over the last couple days, I've been getting a bunch of emails regarding the House Budget and Fairfax County education funding and there has been some confusion. Hopefully, this will clarify that.

First, Virginia adopts a two-year budget after each election. In the "short session" that we are in this year, we adopt revisions to the budget based upon revenue adjustments or proposed policy changes.

In Virginia, the State sends education funds to each locality called "Direct Aid" determined by a formula called the Local Composite Index or the "LCI" which is based on a locality's ability to pay. Roughly speaking, here's how it works.

• True value of real property (weighted 50 percent)
• Adjusted gross income (weighted 40 percent)
• Taxable retail sales (weighted 10 percent)

Putting aside the entire question of how fair this is, Fairfax County doesn't do very well under the LCI because one of the largest variables is property values and income, and our property tax base and incomes are so much larger than everyone else in Virginia we only get around 19% of our education funding from Virginia - other areas get as much as 80%.

At the beginning of this session, the Governor proposed to increase the Direct Aid by $92 million. The House of Delegates took the Governor's proposal and approved changes to it. The changes reduced the Direct Aid transfer and accordingly Fairfax County's K-12 transfer as follows.

Governor's Proposal for Fairfax County--------->$486,956,136
House Budget Amendments-------------------->$481,033,661
Difference Between Governor & House ---->$5,922,475

That's the math.

If there was any doubt about this, yesterday, the non-partisan site Politifact.com tested the assertion that the House Budget Amendments cuts education spending. They rated that claim as TRUE. You can read the analysis here or click on the Politifact "Truth-O-Meter" to the right.

I voted NO on the House Budget in-part because a vote for the House Budget Amendments was a vote to cut Fairfax County education funding by $6 million. You can read the statistics yourself by clicking here. In light of the unfunded mandates and new program needs in Fairfax County, the last thing we need in Fairfax County is less money from the state. See The Dixie Pig, $93 Million of K-12 Cuts.
The Senate proposed amendments that would result in Fairfax County receiving another $100,000,000 **on top** of the Governor's proposal. The net difference is about a $12,000,000 swing for Fairfax County.

There's also been some confusion as to the annual numbers. The State's Direct Aid appropriation in 2009 was $7,103,974,141. In 2011 the adopted transfer was $6,279,724,961. About a $900M difference. In other words, Virginia cut about $1 billion from education last year. That's the math.

There is confusion about this because although the overall amount of state Direct Aid went down, Fairfax County did not get hurt as bad. The reason for this is because Fairfax County's property values cratered much more deeply than the rest of Virginia. Therefore, our relative proportionate share of funding under the LCI actually went up so the amount of money we got in the end was not substantially diminished.

Finally, if you want to take a macro long-term view of education funding in Virginia and what the recent budget actions represent, here's another way to look at it. In FY2011, Direct Aid for Education represented 16.58% of the State General Fund. In 1990 it was 20.15%. In FY2009, the share at 19.17% but the cuts dragged us back down.

FY2012 will have the lowest Direct Education Aid transfer proportional to the overall General Fund in the last 22+ years. I don't have data from before that but state education funding today is at an historical low point.

Those are the facts.

$93 Million of K-12 Cuts

Yesterday, the House of Delegates voted to pass budget amendments proposing to cut over $92 million from the Governor's proposed budget. The final vote is here.

This is also after the Governor Office says there is $500 million in unanticipated new revenues. The House of Delegates voted to divert $150 million in General Fund monies to transportation (I voted no).

The Senate Budget Amendments do not do this.

The House of Delegates voted to cut K-12 education last year for the first time in anyone's recent memory (I voted no). I do not support further cuts to K-12 education. Virginia already gives Fairfax County only 19% of its school funding.

The House of Delegates also voted to do the following:

- Fund a $25 million tax credit for private school funding
- Mandated physical education classes which Fairfax County estimates will cost Fairfax County $8 million

This is at the same time Fairfax County Public Schools is struggling to find $8 million to fund full-day kindergarten.

You can see how much each school system is cut on the document below by comparing the column "HB 1500 As Introduced" with "Recommended House Budget FY 2012."

2011 HOD Budget Amendments - Education Aid Appendix

Pitting Higher Education v. Transportation

When I was a student at JMU from 1989-1993 the country was in the grips of a horrible recession. Governor Wilder was running for President and refused to raise taxes and massive cuts hit the state budget. We got mid-year tuition surcharges at JMU, classes were cancelled, class sizes went up, and all construction was cancelled.

At the time, JMU was a growing school and we needed new buildings. In my senior year, the General Assembly passed a large bond initiate to "catch up" the construction that had been deferred. Normally, education buildings at colleges are paid for with cash from the General Fund. Other university buildings, student unions, dorms, and athletic facilities are paid with student fees.

In 1992, Governor Wilder proposed to spend several hundred million taxpayer dollars on a new Redskins stadium at Potomac Yards. I remember being apoplectic thinking that the Governor cared about the Redskins more than colleges (although sometimes I wonder if the location would not have been better).

The state passed a $900 million higher education bond initiative in 2002 and a $1.6 billion higher education bond intiative in 2007.

This is consisent with state history. Over the last 10 years, 43% of Virginia's bond capacity has been used or higher education. The uses of tax supported debt over the last ten years is shown here on the right (click on the picture to enlarge it).
However, due to HB 3202 passed on the eve of the last Virginia Senate election back in 2007 (before I was elected), the State's use of tax-supported debt, and especially debt for roads, has been exploding. In fact, last year, Virginia hit its debt limit and was not allowed to issue further debt even though additional debt was authorized. This chart on the left taken from the 2010 Report of the State Debt Advisory Committee shows it.

Last fall, the State Debt Advisory Committee looked into changing the way Virginia calculates its debt limit and decided to change the formula resulting in additional debt capacity. You can read that report here. The biggest change was to base the debt limit on a 10-year revenue average instead of looking at the last two years.

After the committee green-lighted more borrowing, Governor McDonnell immediately proposed to compress the next 8 years of authorized transportation borrowing into the three years of his Governor's term.

Most of the debate has focused upon the fact that this is a one-time road fix and not a long-term sustainable model. While that is true and a valid criticism, no one has pointed out is that this will consume most of Virginia's current remaining estimated borrowing capacity.

This means that Virginia will have little bonding "bandwidth" traditionally used for higher education. College construction - one-time expenditures - will put even more pressure on the General Fund that has not existed over the last 20 years. After starting many new colleges after WWII, Virginia has not started construction on a new college in two decades. This is why some kids from Northern Virginia cannot get into UVA, Tech, or JMU with a 4.0 GPA. Limiting our ability to expand our colleges is not wise - we are already behind.

The new model only leaves about $700 million of excess debt capacity remaining through 2020 with current authorized borrowing. That is a tiny margin of error given prior needs.

The Governor has also proposed to divert even more of the General Fund - sales taxes and a large portion of General Fund revenue increases exceeding the average annual increase to the Transportation Trust Fund.

This is the same as using all of your credit card limits to pay for a massive addition to your house right now at the same time you are committing 75% your future salary raises to more home improvements. This would require pay all of your remaining future living expenses which go up with inflation on only 25% of your future raises. None this contemplates the possibility that we get kneecapped by another recession. Flexibility in future budgeting is typically a good thing - committing future revenue can be extremely risky as all of the recent foreclosures demonstrate.

Virginia has run as a fiscally responsible, long-term oriented, pay-as-you-go state for the last 90 years and been rewarded with a AAA bond rating and repeated awards as the best managed state in the country. This kind of budget gimmickry is short-term thinking and irresponsible and unsustainable.

2011 Budget Preview: Rising Debt & Budget Cuts

The Senate Finance Committee held a retreat a few weeks ago regarding the current budget situation. You can read the briefings here.

2011 Session Revenue Outlook

2011 Session Budget Outlook

Overview of State Debt: Implications for Transportation

The bottom line is that while the economy and tax revenue have improved, revenue is still below budgeted projections which means the state budget must be cut the budget again. The Senate Finance Commitee is projecting about $200 million in cuts.

This year's budgeted General Fund revenues are projected to be slightly above collections from five years ago - 2005. We are still in a weak economy.

Moving into FY 2012, things are not likely to get markedly better given that the current budget holes were plugged using substantial amounts of federal stimulus funding such as the recent receipt of $200 million of Federal Medicaid monies.

The Senate Finance Committee also pointed out that the three largest debt authorizations in the history of the Commonwealth have occured since 2007. Debt service is now the sixth largest program in the General Fund behind Public Education, Medicaid, Higher Education, Adult & Juvenile Corrections and the Car Tax Repeal. The use of debt has been driven by lagging General Fund and transportation revenues. The General Assembly also authorized an additional $1.3 billion of debt, but because of lagging revenue growth, the Commonwealth is prohibited by statute from issuing the debt due to statutory debt limits. The purpose of the cap is to ensure Virginia's AAA bond rating which keeps interest rates down and is a fiscally conservative policy.

The trends are troubling. Last session, about $300 million of our $2 billion budget hole were closed with "revenue adjustments" which have now proven to have been overly optimistic (wrong). Last year's budget hole was also plugged using a number of gimmicks including deferring over $600 million of retirement fund contributions - one of many reasons I voted "no" on the final budget.

We can only continue to avoid dealing with reality for so long. Virginia faces significant structural imbalances in its General Fund and Transportation Trust Fund. Until something is done to address these problems, Virginia's residents should not expect to see significant improvements to education, improved affordability higher education, or any relief to transportation gridlock.

VRS Sounds the Alarm

Last session, the State Budget was balanced in-part by the State deferring about $690 million of retirement contributions and promising to pay them back over the next 10 years. At the time, we were told that stock market gains had filled the Virginia Retirement Systems' coffers and that we could afford to do this.

Localities were also given the same option and many local governments who use VRS - such as Fairfax County Public Schools - did the same thing. It balanced the budget, but it mortgaged the future.

I voted against the Budget for many reasons, including this strategy and I wrote about it extensively at the time we passed the budget.

A Balanced Budget Through Salary Cuts & Lower Standards (Mar. 19, 2010)

Final Budget: Small Victories & Misplaced Priorities (Mar. 18, 2010)
Harry Byrd Rolls Over (Mar. 16, 2010)

Voting No on the State Budget (Mar. 14, 2010)

This move would be the same as deciding not to contribute to your 401K for one year and making your contribution in the future. This kind of move is not fiscally conservative or prudent. It is risky. I also did not think that the writers of the Constitution of Virginia would think that a budget was balanced if you used a gimmick like this - from my point of view, this was de facto borrowing which is prohibited in Virginia.

The Pew Center on the States has also estimated that state pension funds across the United States are underfunded by $1 Trillion. They list Virginia as underfunded by $10.4 billion (before this year's actions). For some perspective, $10.5 billion is one-third of Virginia's two-year General Fund Budget.

Two weeks ago, the Trustees of VRS sounded the alarm:

The retirement system's board of trustees vented its frustration yesterday over the state's repeated failure to pay the full contribution needed to fund long-term obligations fully for future retirees.

In the budget year that ended June 30, the system paid $1.5 billion more in benefits to retirees than it received in contributions, and the gap is expected to grow to $2 billion this year.

Investment income has more than compensated for the difference, but VRS officials say the failure to pay recommended payroll rates for pensions raises concerns about the system's viability.

"It's incumbent on this board to make clear the funded status of this fund is in serious jeopardy," said Edward T. Burton III, a University of Virginia economics professor who has served on the board since 1994.

This is not a year when the board recommends contribution rates to the General Assembly for state employee and teacher pensions. However, rates would have to increase by more than 60 percent over last year's rates to fund long-term retirement obligations fully, according to an actuarial analysis presented to the board yesterday.

The rates would have to increase by more than 150 percent from those adopted by the General Assembly for this fiscal year.

The Richmond Times-Dispatch penned an editorial today seconding this problem.

There are many folks on the other side of the aisle from me who are also concerned about this and believe we need to repay the "borrowed" money as soon as possible. This entire exercise is symptomatic of our present collective failure to deal with difficult political problems head on. We have responsibilities whether they are pensions, transit, roads, school facilities, higher education, or secondary education that we are not meeting. The Federal Government is likewise spending money it doesn't have.

We can only put off reality so long. It will be interesting to see if anything happens or whether our VRS deficiency ends up consuming the budget.

Improving Medicaid Coverage Would Mean More Insured Virginians

Virginia's Medicaid system covers certain low-income, disabled, elderly, and young people. Medicaid in Virginia system is one of the stingiest in the United States - 47 states allow people with higher incomes to participate (in Virginia you have to be extremely poor). The cost of Medicaid is shared by the federal and state governments.

The Kaiser Foundation on Medicaid and the Uninsured has released an analysis of the potential effect of federal healthcare reform on the states' Medicaid populations. The report assumes two scenarios: One uses state participation rates assuming moderate levels of participation. The other other assumes enhanced participation by states. Virginia currently has extremely low coverage levels (48th in the United States). What was their conclusion?

The changes to the Medicaid program under the Patient Protection and Affordability Care Act (PPACA) significantly expand Medicaid coverage for adults. There will be large increases in coverage and federal funding in exchange for a small increase in state spending. States with low coverage levels and high uninsured rates will see the largest increases in coverage and federal funding. Higher levels of coverage will allow states to reduce payments they make to support uncompensated care costs.

(Uncompensated care usually refers to care given to people who have no insurance coverage and no way to pay for their care).

The study predicts "state spending could increase by $43 billion while federal spending could increase by $532 billion." This is because the federal government will contribute more for new enrollees than it currently does to present enrollees.

The study also predicts Virginia could see a 50% reduction in the number of uninsured adults at 133% of the federal poverty level or 245,000 more people covered under the "standard" scenario assumptions. The "enhanced" scenario predicts a 75% reduction in uninsured or 365,000 more people covered. Under federal poverty guidelines, a person with an income of $10,830 is considered to be "poor."

Our state presently ranks last in the United States in federal grants due to our limited programs to help low-income people and we ranked 49th in average per capital aid to state and local governments. If you have private insurance, you pay for the uninsured every day so the more people who have health insurance, the better off everyone is.

The bottom line: Given that the federal government will be picking up a large amount of the cost of this, Virginia should be looking very closely at enhancing our Medicaid coverage.

The executive summary is posted below if you would like to read it (it is not light reading material). The full report can be accessed here.

Medicaid Coverage and Spending in Health Reform: National and State-by-State Results for Adults at or Below...

Medicaid's Chickens Come Home to Roost

When the General Assembly passed a budget this past session, I voted "No" for a variety of reasons. One of them was because I thought that the Budget was "balanced" using some very risky strategies. You can read my comments here - Harry Byrd Rolls Over.

One of these was counting on about $400 million of federal Medicaid "stimulus" monies that had been approved by the U.S. House and Senate but were stuck in a conference committee waiting for a final compromise and President Obama's signature. Over the last two years, the Federal Government has reimbursed Virginia's Medicaid expenditures at $0.60 on the dollar instead of $0.50 on the dollar to help with state budgets. The idea was to extend that one more year. That was nearly three months ago.

The Virginia Medicaid Program cares for our low-income, elderly, and children. It cares for our most vulnerable citizens and Virginia's Program is the second most restrictive in terms of eligibility in the United States.

Today, I received an email from the House Budget Staff indicating that federal stimulus monies still were not approved yet and that the adopted Budget has restrictions that were triggers to start July 1, 2010 without the federal money. In order to be prepared for the spending reductions, Virginia is going to start announcing these "service changes." They are not going to be pretty.

If this comes true, first you are going to hear about the poor being denied medical care because more doctors and hospitals will stop accepting Medicaid patients. Then you are going to hear about service disruptions to the severely disabled. You are going to hear a loud scream from hospitals like Fairfax INOVA that gives birth to more children paid for by Medicaid than any other facility in Virginia. Finally, you are going to see a nice fat health insurance increase in your paycheck.

However, this is exactly what I warned about when the Budget was adopted. If we had assumed these cuts were going to occur, the State Budget might have been structured very differently because these kinds of program changes would not have been acceptable. Instead, a massive service disruption is about to hit down on our state's sick, elderly, poor and least capable of bearing these expenses - our most vulnerable.

If you want to see what's coming. Read my prior article - Second Class Citizens? - and watch the video embeded in that post.

Visiting The Northern Virginia Training Center

Last month, I visited the Northern Virginia Training Center to learn about the Commonwealth's role in caring for our community's disabled.

The Training Center was started in the early 1970's on a campus of about 85 acres of land about five miles off the Capital Beltway on Braddock Road. The Center cares for about 190 individuals with severe physical and mental disabilities who are not capable of caring for themselves. It is one of five such facilities in the state.

The facility is largely funded through state funds and Medicaid and staffed by a very dedicated team of highly trained staff and volunteers. Our recent round of budget cuts significantly affects these kinds of services.

I spent about two hours walking through the various programs and services that are offered. Aside from the services necessary to care for people and enhance their quality of life, the Center even does bulk mailing, recycling processing, and I even saw a group of residents assembling hard drives. I also had a chance to talk with many community members who were very happy, engaged, and very welcoming to me into their home.

These services are frequently one of the first places we look for budget cuts and they also do not have armies of well-paid lobbyists advocating for their cause. Walking through a facility like this gives you some perspective regarding the importance of state government, our social safety net, and help you to remember why it is important to look out for everyone in the state and not just those who are best at getting your attention.

Too Many Trailers

This week, the Washington Post reported that 70% of Fairfax County Public Schools have trailers - 135 schools - and that 14 schools have a double-digit number of trailers. Annandale High School has 17.

During my campaign, I frequently argued that the number of trailers in Fairfax County's Public Schools seemed to be exploding and was not acceptable. According to the Washington Post, trailer inventory in Fairfax County is up 38% since 2007. When I attended Hollin Hall Elementary, Waynewood Elementary, Stephen Foster Intermediate, and West Potomac High School, I rarely saw a trailer. We had four at West Potomac when it first opened, but I'm pretty sure they were gone when I graduated. There were no other trailers at any other school I attended.

Today, the opposite is true. Nearly every elementary school in my delegate seat has trailers or as the School Board prefers to call them - "modulars." My daughter at Waynewood has to attend 4th Grade in trailers next year. The picture to the right shows 12 trailers at Waynewood (there are less today). Many of these are nice classrooms, but I have also heard complaints from parents about problems in them such as air quality. The Washington Post noted problems with vermin and "wierd bugs," leaky roofs .

FCPS formally blames the lack of construction on the time needed to obtain construction permits. Construction money has to compete with every other expense in the school system including teacher salaries, programs for at-risk children, and special education. The root cause of the proliferation of trailers is that our school population is exploding while the school system is suffering from a significant lack of revenue and long-term investment. While building brick and mortar schools is more expensive in the short-term, in the long-term it is less expensive. The primary cause of exploding trailer use is a lack of investment in our schools.

A Balanced Budget Through Salary Cuts & Lower Standards

Today, the Virginian Pilot reports that Virginia school spending will really be $700 million less rather than the $250 million reduction in Direct Aid reported regarding the State Budget deal that I discussed here and here. Why is that?

Many localities also use the state retirement plan to fund their school system's retirement. The General Assembly also passed legislation this year "adjusting" actuarial formulas regarding when people will retire and rates of return to reduce our payment requirements. The legislation also required new employees to contribute 5% of their salary towards their retirement - a 5% pay cut. Pay freezes are one thing - 5% cuts are entirely different. This will effect our ability to compete for teachers with other jurisdictions and professions. Another reasons I voted "No."

The state also allowed our localities to increase their class sizes and lower certain academic standards.

The effect? Localities also have to spend less on retirement, thus $700 million total less spent statewide on schools. In other words, we cut teacher salaries which were already 37th in the United States.

So is lowering our standards and cutting salaries going to have any long-term effects? You decide.

Voting No on the State Budget

Today, the State adopted a Budget that undercuts many of its core responsibilities. I voted No. Here is why.

• The State has already reduced its budget by $7 Billion before this session ever began - a huge amount.
• The Budget further reduces $250 million from K-12 education funding.
• The Budget reduces $50 million in funding from higher education funding
• The Budget reduces $150 million in funding for health insurance for the poor
• The Budget reduces retirement and benefits payments to government employees by nearly $900 million
• The Budget reduces funding to Constitutional Officers, localities and public safety by over $250 million.
• This Budget puts at risk our AAA Bond rating and our state retirement system.
• Juxtaposed against this, the Budget funds movie star tax credits, wine promotion, and $48 million in tax breaks for corporations.
• We were given approximately two hours to review the Revised Budget, debate it and vote on it.

Our Caucus along with the Senate achieved many victories in this process:

• The House Budget's original $700 million education cut was reduced to $250 million
• The Local Composite Index rebenchmarking was restored along with education funding for Northern Virginia called "Cost to Complete"
• The Revised Budget removed block grant funding for programs for at-risk children and it restored funding for school breakfast programs and homeless programs.
• The Revised Budget used federal Medical matching money (FMAP) only for Medicaid expenditures instead of "borrowing" it for other programs.

My grandfather always taught me that you either pay less for things now or you pay more for them later. I do not believe these budget "cuts" are cuts. They are simply reductions in funding on going responsibilities that are now being pushed onto the poor, the uneducated, to middle class families and local government who now have to make the tough decisions.

Educating our children, caring for the poor, and keeping our public safe are a core responsibilities of state government. This Budget does not do that. It balances our budgets on the backs of the poor, the sick, the disabled, college students and their families, and the criminal justice system.

And we haven't done a single thing to resolve this state's transportation crisis.