December 15, 2006

Kaine budget amendments would benefit local governments

Programs and services important to local government will benefit from an influx of state revenue if budget amendments proposed by Gov. Tim Kaine are adopted by the 2007 General Assembly.

The governor spelled out for members of the Senate Finance, House Appropriations and House Finance committees Dec. 15 how he believes about $1 billion in state money that is available in the second half of the current biennium should be spent. 

Following a meeting with state budget staff the week of Dec. 18, VML will send members a detailed description of the governor’s proposed budget amendments.  In the meantime, here is a brief summary of some of the items of interest to local governments that would be affected by the amendments.

Links to the governor’s remarks and other information on the budget can be found at www.dpb.virginia.gov under the link “2007 Budget Document.”

 

Transportation

Kaine proposes to set aside $500 million in general fund support for transportation.  This includes $339 million that was reserved for transportation uses on the condition that the legislature adopt an “adequate” transportation plan by Nov. 1, 2006.  Even though an adequate plan was not adopted, the governor proposed dedicating both the $339 million and an additional $161 million from higher-than-anticipated revenue collections.  Of the new money:

• $305 million will be spent to continue construction on several important road projects (Capital beltway hotlanes, Route 50 widening, Interstate 64-Interstate 264 interchanges and the Hillsville bypass)
• $65 million is for rail
• $60 million is for transit (VRE, Norfolk Light Rail and Metro)
• $50 million is for ports, and
• $20 million is for new technology to help deal with congestion, especially in Northern Virginia and Hampton Roads

 

Education

• K-12 education is reduced by $43.4 million in FY07 (the current year), and increased by $26.9 million in FY08, primarily due to decreases in Average Daily Membership (ADM). 

 Specific changes to the state’s $1.5 billion education budget include:

• $63.9 million to fund the state’s share of a 3 percent salary increase for state-supported positions, effective Dec. 1, 2007 (the prior budget supported a 11⁄2 percent raise for instructional positions)
• $4.6 million to fund an estimated six pre-school pilot programs (Start Strong program), to serve an estimated 1,250 children.  The pilots would be voluntary and could include public and private facilities.
• $4.1 million for expansion of the Early Reading Intervention program
• $3.9 million for expansion of the Standards of Learning Algebra Readiness program, to include sixth grade
• Reduction of $20.4 million in FY07 and $35.8 million in FY08 to reflect lower ADM (5,742 lower in 2007, and 8,448 lower in 2008)

 

Public safety

• Increase of $11.5 million in FY08 for payments to counties, cities, and regional jail authorities that provide enhanced retirement benefits to sheriff's deputies.  Funding is for those localities and authorities that provide the enhanced benefits as of May 1, 2008.  State funding would range from $600 to $1,825 for each state-funded position, based on the local fiscal stress index.  The localities judged to be the most affluent would receive approximately $600 per deputy, and the localities measured to be the least affluent would receive higher amounts. 
• Increase of $1.1 million in HB 599 funding for localities with police departments, in FY08
• Increase of $7.7 million in jail per diems, in FY07

 

Human development

• Adds $16.3 million to the Comprehensive Services Act for At-Risk Youth and Families (CSA) program to reimburse localities for treatment foster care services recently determined to be ineligible for federal reimbursement, as well as increased cost of services.
• Adds language to require a study of the feasibility of implementing statewide rates for treatment foster care.
• Adds $26 million to help meet new federal work participation requirements associated with reauthorization of the federal Temporary Assistance for Needy Families (TANF) program.  This includes employment support, childcare, and other mandated program changes.
• Replaces $200,000 in expiring federal grant funding to allow five juvenile detention facilities to maintain mental health services to youth.
• Adds $250,000 to the Virginia Physician Loan Repayment Program to provide loan repayments for more physicians agreeing to serve in medically underserved areas.
• Adds $500,000 to establish four fellowships in child psychiatry and four internships in child psychology through state university hospital systems, with the requirement that the recipients work in underserved areas.
• Adds $5.3 million general fund and non-general funds each to increase by 170 the slots available for individuals on the urgent waiting list for mental retardation waivers.  This allows more individuals to be served in the community, with costs shared by the federal government.
• Adds $3.3 million (and $1.6 million non-general fund) to increase reimbursement for inpatient hospital psychiatric rates from 78 to 84 percent of cost to keep more beds open in the community and attempt to prevent state facility admissions.

 

Economic development

• Adds $4 million for the workforce services program, for total funding of $25 million for this program.  Funding is used to attract new businesses, retain expanding businesses, and ensure Virginia's workforce is adequately prepared and trained.
• Adds $4 million (for a total of $32.4 million) to the enterprise zone grant program to encourage job creation and private investment in distressed areas of the state
• Adds $2 million for the Virginia Housing Partnership Revolving Fund.

 

Natural resources

• Adds $20 million to fund matching grants for land conservation and preservation of working farms and forests through the Virginia Land Conservation Foundation ($13.7 million) and local agricultural purchase of development rights program ($5 million).  Also provides $950,000 for operational support of the Virginia Outdoors Foundation, the historic easement program ($151,920) and the land conservation program at the Department of Conservation and Recreation ($198,080 GF; $99,040 NGF).
• Adds $9.1 million to the Virginia Water Quality Improvement Fund, including $1.6 million for point source nutrient reduction, and $7.5 million for non-point source nutrient reduction.
• Provides a total of $9.1 million for combined sewer overflow projects ($3 million in FY08 to Richmond; $3.1 million in FY07 and $3 million in FY08 to Lynchburg).
• Provides $616,000 in state matching funds for federal grants to repair local Soil and Water Conservation District dams.

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