February 22, 2008

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Impact fee bill expected to be heard next week

The bill that does away with cash proffers for residential units, limits non-cash proffers, and installs a complex impact fee system may be heard by the House Rules Committee Tuesday afternoon. SB 768 (Watkins) continues to include caps on residential impact fee amounts that are too low. The caps would sharply reduce what most developers are required to pay to cover the costs associated with development.

House Speaker Bill Howell, who chairs the Rules Committee, was quoted recently as saying he would prefer to study the bill for a year. VML supports that effort. While VML supports impact fees as an improvement over the conditional zoning system, the bill in its current form clearly shifts the costs related to growth -- new roads, schools and other facilities -- to the taxpayers who already reside in the community and reduces the share of those costs currently paid by the development industry.

VML encourages any locality that is concerned about the effects of SB 768 to contact your delegate to remind him or her that the bill is not in shape to become law; that it should be worked on over the spring and summer by VML and the other affected groups to see if an improved, more balanced bill can be worked out next year.

The members of the House Rules Committee are delegates: W.J. Howell (chair), Putney, Hargrove, Griffith, Landes, Cox, S.C. Jones, Hogan, Abbitt, Hall, Joannou, Spruill, Johnson, Amundson and Armstrong. Please contact these members plus your delegates from home to let them know this important bill is not yet ready.

Staff contact: Mark Flynn (mflynn@vml.org).

Campaign finance disclosure bill carried over

Legislation to require candidates for local offices in cities and counties with populations of more than 100,000 to file electronic campaign finance disclosures was tabled by the House Privileges & Elections Committee Feb. 22. SB 534 (Herring) would have applied to candidates for local offices in 14 localities, as well as to all candidates for the General Assembly.

Staff contact: Mary Jo Fields (mfields@vml.org)

Immigration bills advancing through both houses

For local governments, the immigration bills fall into four categories: overcrowding (HB 445); presumption against bail (HB 440, HB 623 and SB 623); jail operations (HB 820, SB 609) and procurement (HB 926, HB 1298, SB 517 and SB 782).

Overcrowding

HB 445 (Rust) protects a landlord from prosecution for allowing overcrowding by the locality so long as he is pursuing the tenants in court to eliminate overcrowding in violation of the lease. The locality may still pursue compliance with local codes on the number of persons living in a residential unit. The bill is on the Senate floor for final passage.

Presumption against bail

SB 623 (Stolle) and HB 440 (Rust) create a presumption that a person who commits any of a list of serious crimes and who the United States Immigration and Customs Enforcement office determines is an illegal alien is ineligible for bail. The denial of bail in misdemeanor cases and drug possession cases is limited to cases where ICE commits to federal enforcement of immigration laws and to paying the costs of incarceration. SB 623 is in the House Courts of Justice Committee; HB 440 is on the Senate floor awaiting final passage.

HB 623 (Miller, J.K.) requires the governor to enter into an agreement with ICE for certain state and local police to enforce various provisions of the immigration laws. The bill is in Senate Courts of Justice Committee.

Jail operations

HB 820 (Albo) and SB 609 (Stolle) require each jail to ask whether each inmate was born in a country other than U.S. and whether the inmate is a citizen of another country. If the person is either, the jailor must communicate the results to the compensation board, which is to follow up with the compensation board and the federal government.

Procurement

HB 926 (Byron) and SB 782 (Obenshain) require the State Corporation Commission to revoke the charter or authority to do business of any business that violates the laws on hiring illegal immigrants. This could affect the validity of a contract a local government is in with such a business. HB 820 has passed both houses. SB 782 is in the House Courts of Justice Committee.

HB 1298 (Frederick) provides that all public bodies, including local governments, must require that contractors with the public bodies will not knowingly violate the federal law on hiring unauthorized aliens. The bill is in the Senate Courts of Justice Committee. SB 517 (Cuccinelli) contains similar requirements, but applies only to contracts exceeding $10,000. The bill is in the House Courts of Justice Committee.

Staff contact: Mark Flynn (mflynn@vml.org)

BZA attorneys fee bill carried over

SB 519 (Watkins) was recommended to be carried over until next year by a subcommittee Wednesday afternoon. This is the bill that would allow a circuit court to award attorneys fees against the locality where a BZA operates, if the petitioner to the court overturns the BZA's decision.

VML and others argued that the bill was inappropriate policy, as BZAs are quasi-judicial bodies that operate with some degree of independence of the local government. For whatever reason, the subcommittee was asked to carry the bill over. The House Courts Committee's policy is to bring all bills to the full committee for a final recommendation.

Therefore, the bill is on the full committee's agenda. We do not expect a different result in the full committee. VML thanks all the localities who contacted their delegates on the subcommittee to oppose the bill. It appears that your efforts helped form the result. Staff contact: Mark Flynn (mflynn@vml.org).

The budget:

... Senate passes budget package on party-line vote

The Senate approved its amendments to Gov. Tim Kaine's budget bills (SB 29 and SB 30) on a party-line vote of 21 (Democrats)-19 (Republicans).

The protracted floor debate focused on four main issues: (1) the amount to be transferred from the Rainy Day Fund to the state's general fund; (2) the estimate and use of lottery proceeds; (3) reduction in school construction funding; and (4) the rate of inflation to be included in the Medicaid Program for nursing facilities and hospitals.

Senate Republicans sought to defeat the amendments, but were thwarted by a party-line vote on each item.

The Senate budget package approves the transfer of $422.9 million from the Rainy Day Fund to help close the $1 billion shortfall in FY08. Concerning lottery money, Senate budget amendments increase the lottery estimates by $22 million in each year of the new biennium to $472 million, and to increase the transfer of lottery profits to the general fund to help pay basic aid for education. The Senate also agreed to halve the school construction grant program, reducing the floor amount each school division receives from $100,000 to $50,000. As for the Medicaid program, the Senate amendments reduce from 4.8 percent to 2 percent the rate increase for nursing home and hospital providers.

Lt. Gov. Bill Bolling employed a parliamentary maneuver to help his fellow Republicans. Bolling ruled that both SB 29 and SB 30 failed to garner the necessary votes for passage, asserting that passage required a four-fifths majority rather than a simple majority. The Democrats appealed and overturned his rulings.

... House passes budget by large margin -- but there were battles

The battle of the budget was perhaps not as drawn out in the House of Delegates as in the Senate, but there was sparring over some of the items, particularly the proposal to change the methodology for rebenchmarking the costs of education. In the end, the House approved the budget 93-5.

Most of the House amendments were adopted by large margins, with the closest votes coming in the areas of education, Medicaid and economic development. The House proposal to change the methodology for rebenchmarking (or updating) the costs of education drew one of the closest votes, passing 54-44.

The House budget package approves the transfer of $225 million from the Rainy Day Fund to help close the $1 billion shortfall in fiscal year 2008. Like the Senate, House budget amendments increase the lottery estimates by $22 million in each year of the new biennium. The House funds a 2 percent salary increase for state employees, teachers, and state-supported local employees, effective Dec. 1, 2008, and increases the school construction grants program by $35 million a year. The funding for the salary increase and grants program comes from savings generated by the change in rebenchmarking methodology. The House budget also diverts $14 million in HB 599 funding to pay for benefits under the Line of Duty Act, community resources officers, and Internet crime task forces. The House budget eliminates the towns' portion of the ABC profits and wine liter tax, generating a savings of $533,000 a year for the state.

Senate Finance Committee to consider bills of interest to localities

Under the governing resolution, the House Finance Committee and Senate Finance Committee will have to complete their work on the revenue bills of the other house by midnight, Feb. 26.

These bills of interest to local governments remain in the Senate Finance Committee:

HB 1009 (Hugo) -- Real estate taxes; assessments, bills, and deferral by localities

HB 111 (Scott) -- Highway systems; revenue-sharing funds

HB 923 (Rust) -- School construction revolving loan fund

HB 1123 (S.C. Jones) -- Real estate and personal property taxes; applied to property of public service corporations

HB 525 (Suit) -- Vehicle registration fees; exempts member and dependent of armed forces

HB 314 (Morgan) -- Assessors and appraisers; Tax Department to establish certification program

HB 788 (Ingram) -- Highway maintenance payments; Arlington and Henrico Counties receive payments for roads

The House Finance Committee will consider SB 729, which authorizes the Northern Virginia Transportation Authority to impose a 1/2 percent retail sales and use tax. The bill also prohibits the Authority from imposing: (1) a one-time vehicle registration fee of one percent of a vehicle's value registered in a county or city belonging to the authority; (2) a 5 percent sales tax on labor or services charged in automobile repairs in a member county or city; or (3) an additional annual $10 vehicle inspection fee for vehicles inspected in a county or city embraced by the authority.

If your locality has a position on any of these bills, please information your delegation and VML.

Staff contact: Neal Menkes (nmenkes@vml.org)

Homestead exemption: Senate defers action on constitutional amendment; House kills implementation bill

HJR 4 (Albo) and HB 11 (Albo) were scheduled for Senate floor action today, but were carried over until Monday at the request of Sen. Janet Howell. HJR 4 is the constitutional amendment authorizing the General Assembly to pass legislation allowing localities to adopt a homestead exemption or deferral program. HB 11 is the bill to put the measure on the ballot for the November election.

In the House of Delegates, a subcommittee of the Privileges and Elections Committee approved a motion to table SB 496 (Northam), a bill to implement the constitutional amendment creating the homestead exemption program. The same subcommittee had earlier killed the House companion bill to SB 496.

Thus, there is no bill before either chamber providing local governments with the necessary flexibility to establish and manage a homestead exemption program. Some delegates and speakers insisted that the General Assembly could wait until the 2009 session to enact the implementation bill.

Staff contact: Neal Menkes (nmenkes@vml.org)

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