Virginia state budget
From Sunshine Review
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Currently, a revised forecast for the 2009-2010 Virginia state budget is expected to reach a $2.9 billion revenue shortfall.[1] This is an increase of nearly $400 million from similar projections back in October of 2008, and $100 million more than projections from two weeks prior to the Governor's December 17th 2008 Revenue Projection. [2] Governor Tim Kaine reports that this revenue shortfall will be the result of adjustments of $138.6 million for the fiscal year 2009, and $229.6 million for 2010.
With President Barack Obama's economic stimulus package, the state of Virginia could potentially receive as much as $5.8 billion in aid, with nearly $1.5 billion of the funding going towards offsetting the revenue shortfall.[3]
As of February 16, 2009 Governor Kaine expects the budget shortfall to increase more than 25% towards nearly $3.7 billion. Yet due to the recently passed stimulus package, allocated funds are expected to be used towards offsetting this increase.[4]
[edit] Potential Short-term Problems
With the current revenue projections of Government Kaine, several measures will be implemented to cover the growing revenue shortfall. The following are examples of such measures:
- Proposed cuts of $34.5 million to Sheriff's offices, resulting in the layoffs of up to 310 deputies statewide. This has resulted in outcry from members of the law enforcement community due to concern for public safety should the cuts occur.[5]
- Proposed increase of cigarette taxes of $.30/pack could potentially lead to job cuts among the estimated 5500 workers of tobacco giant Phillip Morris in Virginia.[6]
- Trim nearly $1 billion from K-12 education and Medicaid.[7]
[edit] Budget Background
[edit] Virginia Budget History
- Virginia has operated under a biennial system since the Constitution of 1851 provided for biennial Sessions.
- In 1870, the Constitution was amended to require annual sessions, only to have biennial sessions restored in 1876.
- In 1976, the Commission on State Governmental Management voted on a study of the structure and processes of state government. Their findings caused them to reject (14 to 1) proposed legislation to remove the biennial process due to the fact that "the budget formulation process has been compacted into too short a times period in the past resulting in an inability of executive branch management to undertake the in-depth analysis necessary to focus on alternative solutions to the problems facing the state."[8]
[edit] The Budget Process
- The biennial budget is enacted into law in even-numbered years, and amendments to it are enacted in odd-numbered years.
- Agencies evaluate and estimate their future costs and submit a potential budget to the Department of Planning and Budget(DBP).
- The DBP analyzes the various agency requests, and then pass along the resulting findings to the governor for him and his cabinet to prepare the proposed state budget for the General Assembly's approval.
- The General Assembly convenes each year on the second Wednesday of January, where the Governor's prepared budget is presented in the form of a bill.
- After being reviewed by committees in both the state House and Senates, amendments are added and voted on in each chamber.
- Each house sends their version of the amended budget bill to the other for consideration and another vote.
- A conference committee resolves any differences between the two versions of the bill, and sends the resulting single version to the Governor for his signature.
- The Governor reviews the bill passed by the General Assembly, and may either sign it, veto it entirely, or use the power of the 'line-item veto,' or recommend further amendments.
- If the Governor vetoes the bill, or any item on it, it is sent back to the General Assembly during the spring session.
- The final passed budget is then enacted into law and goes into effect on July 1 in even-numbered years and on the date of passage in odd-numbered years.[9]
[edit] The 2008-2010 Budget
The 2008-2010 biennial budget is composed of two types of revenue, the General fund, and the Non-General fund.[10]
[edit] General Funds
General Funds account for 45.3% of the 2008-2010 budget revenue. The revenues collected for the general fund are spend for a large variety of purposes at the discretion of the Governor and other state agencies. These funds are mostly comprised of three main sources:
| Source of Revenue | Percentage of Overall
General Funds Revenue |
|---|---|
| Sales and Use Tax | 19.9% |
| Individual and Corporate Income Tax | 71.5% |
| Other Taxes | 9.8% |
[edit] Non-General Funds
Non-General Funds account for the other 54.7% of the state revenue. These funds are typically ear-marked by law for specific uses. [11]
| Source of Revenue | Percentage of Overall
General Funds Revenue |
|---|---|
| Federal Grants and Contracts | 38.2% |
| Other Revenues | 24.1% |
| Transportation | 13.1% |
| Insitutional Revenue | 24.6% |
[edit] Proposed Action
Budget News Conference 10/9/08 |
To the right are two videos of Governor Kaine speaking about the budget, and how state funds will be cut or spent to remedy this current situation.
- Governor Kaine delivering a budget-centered conference stemming from his October budget estimates
- Governor Kaine delivering his State of the Commonwealth Address, largely focusing on the state of the budget and the shortfall it includes
In addition, Both chambers of the Virginia General Assembly have proposed their own potential short-term actions to combat the current budget shortfall. Listed below are examples of the proposed actions from both the Republican-controlled House, and the Democrat-controlled Senate.
[edit] House
- Save or raise money by offering early retirement to school employees 50 or older, and changing the way the state collects sales taxes.
- Spend more on tourism.
- Transition care for those with special needs to their homes instead of institutions.[12]
2009 State of the Commonwealth 1/19/09 |
[edit] Senate
- Accelerate sales-tax collection
- Divert funds from the state's smoking-prevention program to offset the escalating cost of Medicaid
- Increase cost of out-of-state tuition at public colleges and universities
- Postpone training schools for new state troopers[13]
On February 18, 2009 the state Senate passed it's version of the budget that includes provisions aided by the recently passed federal stimulus package. This Senate budget includes several of the following provisions:
- $216 million of stimulus money to make up for budget shortfall in the areas of health care, education, and public safety.
- Additional $800 million towards reducing the cuts to education and public safety with restrictions that have yet to be disclosed
- Restore funding towards mental health facilities
- $60 million in building projects that would otherwise be funded with debt
- $46 million in unappropriated funds in case economy continues downward trend
- Retain original provisions of Governor Kaine's budget calling for the early release of non-violent offenders, but reducing the number of those eligible.[14]
Note: Due to the House staying with their initial budget that doesn't include stimulus money, and the Senate passing the new budget, negotiations are expected to be expedited to occur before the General Assembly adjourns February 28, 2009.[15]
[edit] Transparency
Budget Transparency in Virginia Part I 1/8/08 |
Virginia currently has partial spending transparency through its website, Commonwealth Data Point. However, as noted in the chart below, Virginia's database falls short of certain transparency standards. Greater transparency will characterize state spending soon, given the passage of legislation in 2009:
In 2009 there were two transparency bills pending in the Virginia General Assembly: Virginia Senate Bill 936 and Virginia House Bill 2285. SB 936 "Provides for the Virginia Enterprise Applications Program (VEAP) within the Office of the Secretary of Technology to create and maintain a searchable database website containing information on state revenues, appropriations, and expenditures."[16] HB 2285 mandates creation of a comprehensive, searchable database of Virginia government spending, easily accessible to members of the Commonwealth.
On February 25th, 2009, both Virginia Senate Bill 936 and HB 2285 were passed unanimously.[17]
[edit] News
To get the most recent updates, sign up for the Show Me The Spending weekly transparency e-updates. As transparency news about Virginia becomes available, it will be sent out by email and posted here.
- 2/18/09 Senate Bill 936 Referred to House Committee on Appropriations from House Committee on Science and Technology.[18]
- 2/13/09 Senate Bill 936 placed on House calendar.[19]
Budget Transparency in Virginia Part II 1/8/08 |
- 2/12/09 House Bill 2285 Referred to Senate Rules Sub-Committee:Studies[20]
- 2/10/09 House Bill 2285 Passes on a block vote (99-Y 0-N)[21]
- 2/10/09 Senate Bill 936 Passes on a unanimous vote (40-Y 0-N)[22]
- 12/15/08 Senator Ken Cuccinelli joined Tertium Quids radio to discuss the transparency bill he and Sen. Chap Petersen will be co-patroning in the 2009 General Assembly session. A similar bill was defeated in committee last year, and Cuccinelli offers some insights on why the bill was unsuccessful.In the interview, Cuccinelli makes the case for an enhanced state transparency web site, in additon to efforts he is taking to help clear roadblocks that prevent local governments from making their own check books open to public scrutiny. Cuccinelli noted that only a handful of people in Virginia government have access to critical budget information and they prefer it to remain that way. His bill would go beyond the existing Commonwealth Data Point system by placing spending in context, giving people the power not only to search the database (Commonwealth Data Point currently blocks commercial search engines) but also to understand where, why and to what end spending occurs.
- 10/22/08: As was mentioned recently on www.governmentbytes.com, the Tertium Quids radio program just hosted Megan Rhyne, Executive Director of the Virginia Coalition for Open Government. Yesterday’s show (accessible here) provided some helpful perspective on transparency in Virginia. Unlike many states, Virginia does have partial transparency thanks to the work of Senator Walter Stosch, whose legislation, Senate Bill 934, led to the Commonwealth Data Point database, launched on November 1, 2005. The site is maintained by the Auditor of Public Accounts. However, as the show’s host Norman Leahy pointed out, Commonwealth Data Point has deficiencies. The site provides aggregated information about budgets, expenditures, and revenues, but that information often lacks specificity and detail. Additionally, the site does not allow users to search for specific employee salaries. Transparency advocates should note one of Rhyne’s insights. When a political party in power is approached about opening up government spending, party members may view that approach as an attack. Transparency advocates should preempt this unproductive reaction by crafting their methods and language to disarm opposition and win the favor of the party in power. Transparency is a non-partisan issue: portraying it as such makes its achievement less difficult.
[edit] Legislation
- Virginia Senate Bill 936 (2009) (noted above). Sponsor: Kenneth Cuccinelli. Would establish a searchable database website containing information on state revenues, appropriations, and expenditures.
STATUS: Passed through Senate, moved to House.
- Virginia House Bill 2285 (2009). Sponsor: Benjamin Cline. Would create a comprehensive searchable database of Virginia government spending, easily accessible to all taxpayers.
STATUS: Passed through House, moved to Senate.
- Virginia Senate Bill 585 (2008). Sponsor: Kenneth Cuccinelli. Would put the state budget online in a user-friendly, searchable format.
STATUS: Pending
- Virginia House Bill 1360 (2008). Sponsor: Benjamin Cline. Would put the state budget online in a user-friendly, searchable format.
STATUS: Pending
- Virginia Senate Bill 934 (2005). In 2005, Senator Walter Stosch sponsored Senate Bill 934, which created the official Commonwealth Data Point website.[23]
In January 2008, Senator Ken Cuccinelli sponsored a new bill, Senate Bill 585, that would have authorized a bill for searchable spending database.
The Virginia Senate General Laws and Technology Committee voted to put off further review of the bill until 2009 (effectively killing the bill for 2008) by a 9-6 vote. The committee members voting against the legislation included:
[edit] Government tools
The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:
| State Database | Searchability | Grants | Contracts | Line Item Expenditures | Dept/Agency Budgets | Public Employee Salary |
|---|---|---|---|---|---|---|
| Commonwealth Data Point |  |  | | | | |
[edit] Limitations and Suggestions
Commonwealth Data Point's expenditure area is only searchable by vendor (there are "drop down" searches for agency, object code, and fiscal year). Most average citizens wouldn't know the necessary vendors to search for to get to relevant information. Users should be able to search by keyword.
Users can "drill down" into the spending information to a certain point, but at the end of the day, you still can't really tell what they're spending the money on. It might say $624.57 paid to GE Capital Finance on August 2, 2007 for agricultural supplies for the Central Region Correctional Field Unit, but you still don't really know what the money is being spent on. Bonds? Tractors? Donuts? Same problem with the small purchase card charge sector. It gives the amount and vendor, but never says what was purchased. We need that information if we want to help identify waste. To cite a recent article, "extracting usable information from the site isn't easy. Data Point records individual transactions, but with very little if any data explaining why the state spent the funds."[24]
The site's designers say that users should contact original agency sources if they want more detailed information, but since they don't give staff contact information, it leads people nowhere fast.
There are also many more areas of detailed spending information that could be added to the site (e.g., public employee salary information).
[edit] Economic Stimulus Transparency
- The Economic Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.[25]
- Virginia will receive an estimated $3,249,976,261.[26]
- The economic recovery website to show how legislators and government officials in Virginia are spending Federal funds is available here.
[edit] Support for creation of the database
The National Taxpayers Union and the Council for Citizens Against Government Waste sent a letter to the Virginia General Assembly in 2008 expressing support for House Bill 1360. The groups urged legislators to bring greater transparency to Virginia's government spending by creating an expansive online database containing expenditure information along with program performance results.[27]
NTU State Government Affairs Manager Joshua Culling submitted testimony on January 28, 2009 in favor of Virginia Senate Bill 936 (2009). [28]
NTU also sent an alert to its more than 8,000 Virginia members on February 2, 2009 urging them to contact members of the House Science and Technology Committee in support of House Bill 2285 HB 2285. [29]
[edit] Public employee salary information
The Bristol Herald Courier performed a salary survey of Southwest Virginia and Northeast Tennessee, and published the results here.
Every year the Mace and Crown, the student newspaper at Old Dominion University, publishes salaries of administrative and faculty employees at ODU. As of October 2008, the latest set of data (March 2008) is available at this website in PDF, Excel, and Text format. Typically when the Mace comes out with new figures, it is posted on the Mace website at maceandcrown.com.
[edit] See Also
Virginia taxpayer-funded lobbying
[edit] External links
- Model transparency legislation from the American Legislative Exchange Council is available at this link.
- Thomas Jefferson Institute
- Virginia Institute for Public Policy
- Commonweatlh Data Point
- Virginia Department of Planning and Budget
- Virginia General Assembly
- Virginia government spending
- Senator Cuccinelli talks about Virginia's level of transparency. Listen here.
[edit] References
- ↑ Official Site of the Governor of Virginia, 'Governor Kaine Announces Revenue Reforecast, Plan to Address Shortfall,' December 17, 2008
- ↑ The Virginian-Pilot, Virginia's budget shortfall forecast approaching $2.8B, December 3, 2008
- ↑ The Washington Post, Va. House, Senate Set For Clash On Budget, February 9, 2009
- ↑ The Washington Post, Va. Budget Shortfall Reaches $3.7 Billion, February 17,2009
- ↑ The Virginian-Pilot, Virginia Sheriffs Warn That Budget Cuts Will Harm Public Safety, January 26, 2009
- ↑ Richmond Times-Dispatch, State Budget A Work In Progress, December 20, 2008
- ↑ The Washington Post, Va. House, Senate Set For Clash On Budget, February 9, 2009
- ↑ Bacon's Rebellion, "Don't Mess with Virginia's Biennial Budget System," February 3, 2009
- ↑ Virginia Department of Planning & Budget, How is Virginia's Budget Adopted?
- ↑ Virginia Department of Planning & Budget, Where does the money come from?
- ↑ Virginia Department of Planning & Budget, Where does the money come from?
- ↑ The Washington Post, Va. House, Senate Set For Clash On Budget, 2/9/09
- ↑ The Washington Post, Va. House, Senate Set for Clash On Budget, 2/9/09
- ↑ Forbes.com, Virginia finance committee passes revised budget, 2/18/09
- ↑ WBOC TV, House, Senate Set Up Budget Negotiations, 2/18/09
- ↑ Virginia General Assembly Legislative Tracking
- ↑ Tertium Quids, "Transparency Bills Pass Senate, House," February 25, 2009
- ↑ Bill Tracking, SB936, 2009 Session
- ↑ Bill Tracking, SB936, 2009 Session
- ↑ Bill Tracking, HB2285, 2009 Session
- ↑ Bill Tracking, HB2285, 2009 Session
- ↑ Bill Tracking, SB936, 2009 Session
- ↑ Virginia Auditor of Public Accounts, "About Us"
- ↑ Northern Virginia Daily, "Bill would make state spending transparent", January 20, 2009
- ↑ National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
- ↑ [1]
- ↑ "An Open Letter to the Virginia House of Delegates: Taxpayers Support Online Spending Transparency (HB 1360)," January 29, 2008
- ↑ "Testimony of Joshua Culling, State Government Affairs Manager, National Taxpayers Union, to the Virginia Senate General Laws and Technology Committee on SB 936," January 28, 2009
- ↑ "Urge Your Representatives to Vote for More Transparency!" February 2, 2009
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