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Analysis: House and Senate budget amendments, revenue picture detailed
Last week the House and Senate released their versions of the 2008-2010 budget and changes to the current year (FY08) budget. The following is an explanation of the overall financial picture, and selected House and Senate budget amendments of interest to local governments.
The General Assembly's schedule calls for House and Senate budget conferees to work out the differences between their two budgets by Tuesday, March 4. The House budget conferees were named early in the session (Dels. Lacey Putney; Phillip Hamilton; Kirk Cox; Johnny Joannou; Beverly Sherwood; Clarke Hogan); as of Feb. 26 the Senate had not named its conferees.
What follows is an explanation of some of the issues House and Senate budget writers face as they work to come to agreement on a budget. The majority of this analysis refers to HB/SB 30, the bill addressing the 2008-2010 budget. At the end of this document are amendments proposed for HB/SB29, the current year, or caboose budget.
The first part of this analysis explains some of big picture issues and how the House and Senate are approaching them. These include revenue projections, capital projects, and use of the Rainy Day Fund. The second part of this analysis details some of the proposed amendments of interest to local governments. All of the House and Senate amendments can be viewed on the General Assembly's Legislative Information Services Web site, http://leg2.state.va.us/MoneyWeb.NSF/Bud2008.
I. The Big Picture: Cash, revenue projections, etc.
Cash
The Department of Treasury does not cut a check unless there is an appropriation and the cash to back up the appropriation. Cash is comprised of taxes, fees, other revenues, and, in times of economic slowdown, state capital projects and the Rainy Day Fund.
Resolving the cash difference between the House and Senate is critical in achieving a budget compromise.
Revenue projections
The General Assembly relies on the governor's revenue forecast to determine the amounts of taxes and fees in the current and upcoming fiscal years. In December, the budget assumed general fund revenues of $34.3 billion for the 2008-2010 biennium. By mid-February, the revised 2008-2010 revenue forecast was slashed by $1.05 billion and by another $339.3 million for FY08.
The General Assembly is not legally obligated to follow the governor's revenue forecast. Indeed, the House made an adjustment of $82.3 million in its budget amendment package, assuming that non-withholding of personal income taxes will produce $28.2 million in FY 2009 and $54.1 million in FY 2010 more in revenue than the Governor's revised forecast. The Senate did not adjust the governor's non-withholding numbers.
As for the other major revenue categories, including withholding of personal income taxes, tax refunds, general sales and use taxes, and recordation taxes, both the House and Senate budget amendments track with the administration's revenue projections.
Both the House and Senate approved amendments increasing 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 amendment to increase the lottery estimate drew heated debate in the Senate.
Capital projects
The House budget package includes amendments cutting $629.3 million from state capital projects in FY08. In contrast, the Senate approved amendments removing $125.4 million of general fund cash from capital projects.
For the 2008-2010 biennium, the House restored a portion of its capital spending cuts -- $177.9 million. In other words, the House plan is to "cash flow" the projects to match scarce dollars with actual construction schedules. The House plan also includes swapping general fund dollars with new debt issuances or loans -- $276.5 million. The total impact of the House package is to provide $134.7 million from the general fund for capital projects in 2008-2010.
The Senate approved a fund swap of $231.5 million in 2008-2010. The Senate budget amendments produce a net cut of general fund spending of $212 million.
All told, the House and Senate budget amendments result in general fund savings of $494.6 million and $337.5 million, respectively. This difference of $157.2 million will have to be resolved in budget conference in addition to major differences between the two amendment packages concerning non-general fund capital projects.
Rainy Day Fund
The Senate accepted the governor's recommendation and approved an amendment to transfer $422.9 million from the Rainy Day Fund to the general fund. The House also approved an amendment transferring $225.0 million from the Rainy Day Fund. The difference between the two actions is $197.9 million.
II. Budget amendments of interest to local governments
The following is a listing of budget items of interest to local governments. We have grouped them by topic (aid to localities, education, economic development, etc.). Under each topic, we list amendments offered by the House and Senate. We include an item number for any amendment proposed by either chamber. If you correspond with your members of the General Assembly or the budget conferees about any amendments, please remember to refer to the item number as well as the topic addressed by the amendment.
Transfer Payments to Localities (Aid to localities)
State assistance to local law enforcement (HB 599)
House: Takes $14.9 million from this funding stream over the biennium to supplant state funding for other purposes, including state funding for regional criminal justice training academies (decrease of $1.1 million a year in HB 599 funding); school resource officers (decrease of $1.5 million a year in HB 599 funding), line of duty benefits (decrease of $3.97 million in FY09 and $4.4 million in FY10 in HB 599 funding), and Internet crime task forces (decrease of $1.25 million in FY09 in HB 599 funding in order to appropriate $750,000 to the Bedford Sheriff's Department Internet crime task force and $500,000 to the State Police for its DC/NOVA Internet crime task force. Funding for the school resource officers and line of duty presently comes from the general fund; criminal justice academies are usually funded from court fees; the funding for the Internet task forces would be new. (Item 395 #2h, Item 395 #3h, Item 397 #1h, Item 397 #2h)
Senate: Adds $2.5 million in the first year to fully fund this program; level funds the program in the second year. (Item 397 #8s)
ABC and Wine Taxes
House: Eliminates the $533,000 each year in ABC/Wine Tax distributions to towns. (Item 264 #1h, Item 3.01 #2h)
Senate: Adjusts the amount of ABC/Wine Tax proceeds expected to be distributed to towns, from $260,000 to $273,000 each year. The introduced budgeted eliminated the distribution of these proceeds to cities and counties. (Item 3-1.01 #1s)
Line of Duty Act
House: Decreases the state's appropriation to this item by $4 million in the first year and $4.4 million the second year and supplants these amounts with HB 599 funding. Line of duty payments go not only towards local law enforcement, but also to Virginia National Guard, State Police, state correctional officers, as well as local fire and EMS workers. (Item 267#1h)
Senate: Does not address.
Recordation Taxes
Neither the House nor Senate proposed changes for recordation tax distributions.
Compensation & benefits
VRS and Employee Compensation
House and Senate: Set 30-year amortization period for the computation of VRS retirement benefits for state employees and state-supported local employees. (Item 472 #1h, Item 472 #10h)
House: Funds a 2.0 percent salary increase for state-supported local employees, effective 12/1/08 for FY09 and establishes a contingency reserve for a salary increase for FY10 (Item 472 #2h)
Line of Duty
House: Diverts $3.97 million in FY09 and $4.4 million in FY10 in HB 599 funding to the Department of Accounts to pay for costs associated with benefits provided under the Line of Duty Act. (Item 397 #1h)
Senate: SB 329 establishes a funding source for the Line of Duty Act through imposition of state fees on false alarms. The Senate budget anticipates funding of $17 million a year in NGF from the bill, and decreases general fund allocations to Line of Duty by $10.5 million in FY09 and $11.8 million in FY10 as a result. (Item 267 #1s)
Compensation Board (non-jail issues)
Commissioners of revenue tax services
House: Removes $1.2 million of state funding each year to commissioners of the revenue to recoup the funding associated with these officers providing state tax services to residents of Virginia. (Item 72 #1h)
Senate: Does not address.
Study of annual cost reporting for constitutional officers
House: Does not address.
Senate: Directs the Compensation Board to conduct a feasibility study of developing an annual operating cost report for commonwealth's attorneys, commissioners of the revenue, and treasurers, using a reporting format similar to that in the annual jail cost report. Feasibility study is due 1/1/09. (Item 70 #4s)
Economic Development
Business Incentives
Both House and Senate amendments cut spending in this area but with different degrees of emphasis.
Business Incentives Governor's Opportunity Fund -- FY08 Qimonda Semiconductor Manufacturing Grant Program Governor's Opportunity Fund -- 2008-2010 biennium Motion Picture Opportunity Fund Workforce training and retraining funds Investment Performance Grants SRI
Virginia National Defense Industrial Authority / Virginia Economic Development Partnership
House: Reduces funding for the authority by $100,000 each year (Item 124 #3h).
Senate: No amendment.
Base Realignment and Closure Commission (BRAC)
House: Reduces funding by $6.0 million, leaving $11.0 million to be distributed as follows: $7.5 million to assist any locality with a U.S. Navy Master Jet Base, $2.0 million related to expansion at Fort Lee, and $2.0 million to assist in the retention of DARPA (Item 473 #1h).
Senate: No amendment.
Expand Rural Access to Broadband Technology – Dept. of Housing and Community Development
House: Eliminates funding of $500,000 each year to expand rural access to broadband technology on the Eastern Shore (Item 110 #5h).
Senate: No amendment.
Direct Aid to Education
Rebenchmarking
House: Changes methodology for the biennial rebenchmarking (updating) of the cost of K-12 education, for a savings of $82.5 million in FY09 and $84.3 million in FY10. The House uses the savings to fund a salary increase in FY09 and to increase school construction grants in FY09 and FY10 (see below). The changes 1) recognize only the salaries granted by the state for support personnel in 2008-2010, and for teachers in succeeding biennia; 2) increase the amount of the federal revenue reduction, which means that school divisions that receive more federal revenue (typically directed at at-risk students) will realize a decrease in state funding); and 3) pegs inflation to the Consumer Price Index with a decreasing state contribution for inflation rates over 3 percent. Currently inflation is based on actual costs; for this year the inflation figure under the current methodology was 7.3 percent. The proposed change would cut that in more than half. The full effect of the changes would not be felt until the 2010-2012 budget. An initial estimate is that state funding for rebenchmarking would decrease by at least $225 million a year. Those costs would be shifted to local governments. Changes in rebenchmarking do not change what education costs, only what the state agrees to fund. (Item 140 #52h)
Senate: Does not propose changes to the rebenchmarking process, but cuts school construction grants and diverts some lottery profits to the state general fund (see below).
Teacher salaries
House: Funds a 2 percent salary increase, effective 12/1/08 for FY09 at a state cost of $45.2 million in FY09 and $77.8 million in FY10; establishes a contingency reserve for a salary increase in FY10; and eliminates the 3 percent salary increase for FY10 ($130.7 million) in the introduced budget. (Item 140 #52h, 140 #11h)
Senate: Funds a 2.5 percent salary increase, effective 12/1/09 for FY10 the 3.5 percent salary increase (for teachers) and 3.0 percent increase for support personnel effective 7/1/09 for FY10 in the introduced budget. The change in the effective date and amount results in a savings to the state of $122.1 million. (Item 140 #5s, Item 472 #12s)
Retirement & fringe benefits
House and Senate: Set a 30 year amortization period for the computation of VRS retirement benefits for teachers. This action lowers the retirement contribution rate to 8.81 percent, a decrease from the 11.84 percent proposed by the VRS board of trustees, and the 9.35 percent in the introduced budget). This results in a savings for the state and localities, although it may have a negative effect on the long term solvency of the teachers retirement fund. (Item 140 #52h, Item 472.10 #1h, Item 472 #9s)
House: The House lowers the retiree health care credit rate from 1.12 percent to 1.08 percent, and the group life insurance rate from 0.36 percent to 0.33 percent. (Item 140 #52h)
Senate: Defers pre-funding of early retiree health benefits, pending completion of the JLARC study on compensation, for a savings of $11.7 million in FY09 and $7.0 million in FY10. (Item 472 #10s)
Virginia Preschool Initiative
House: Reinstates the current method of funding and removes the expansion of VPI included in the proposed budget, for a savings of $9.1 million in FY09 and $22.9 million in FY10 (Item 140 #15h)
Senate: Scales back the expansion of VPI contained in the introduced budget, for an increase in funding over the current year, but a decrease of funding of $6.7 million in FY09 and $6.3 million in FY10 from the introduced budget. The per-pupil funding is increased from the current $5,700 to $6,000 in FY09 and $6,700 in FY10. (This amount is shared by the state and local government based on the composite index.) The number of funded slots is increased by adding 10 percent of students eligible for reduced price lunch in FY09 and 20 percent in FY10. (Item 140 #11s)
Sales tax
House and Senate: Decreases sales tax revenues by $10.8 million in FY09 and $14.7 million in FY10 to reflect updated forecast. When sales tax revenues go down, the state and local required share of basic aid goes up. (Item 140 #12h, Item 140 #12s)
Literary Fund
House: Diverts $25 million a year from the Literary Fund to help pay teacher retirement and adds $5.0 million in FY10 for the Literary Fund interest rate subsidy grant program. (Item 140 #17h, Item 140 #9h)
Senate: Diverts $14 million from the Literary Fund in FY09 to help pay teacher retirement costs. (Item 140 #10s)
School construction
House: Adds $35.2 million in FY09 and $37.2 million in FY10 for a supplementary school construction grants program. Places new requirements on the use of the existing school construction grants program, and on the supplemental program, by requiring localities affected by BRAC to use these funds, as well as those from the existing school construction grants program, for facilities needs due to the in-migration of BRAC-related personnel. (Item 140 #52h, Item 140 #18h)
Senate: Reduces the school construction program by half, for a savings of $13.7 million a year. The school division base grant would be reduced from $100,000 to $50,000. (Item 140 #8s)
Lottery profits
House: Diverts $9.0 million in excess lottery profits projected to be realized in FY08 to the general fund in FY09, to help pay the state share of basic aid for education costs. (Item 140 #52h)
Senate: Level funds the distribution of lottery profits to localities, for a savings of $17.2 million a year. (Item 140 #7s)
At risk funding
House: Level funds Project Discovery in FY10 (the introduced budget included an increase) for a savings of $100,000; eliminates separate funding for Project Discovery for a savings of $900 million in each year; removes funding in introduced budget for Communities in Schools for a savings of $500,000 in FY10; and raises the eligibility threshold (thus eliminating the eligibility of 20 school divisions) for participation in the at-risk add-on program, for a savings of $2.6 million in each year; removes funding for data coordinators included in the introduced budget for a savings of $2.1 million in FY10. (Item 139 #2h, Item 139 3h, Item 139 #4h, Item 140 #140h; Item 140 #6h).
Senate: Restores $100,000 for Jobs for Graduates; removes funding in the introduced budget for Communities in Schools for a savings of $500,000 in FY10; and removes funding for data coordinators included in introduced budget for a savings of $2.1 million in FY10 (Item 139 #3s; Item 140 #18s, Item 140 #15s)
School meals
House: Decreases funding by $1.0 million in FY09 and in FY10 and sets 2006 as the base year for computing reimbursement for FY09 and FY10. (Item 140 #7h)
Senate: Adds $682,042 in FY10 to provide 5.0 cent reimbursement for school lunches. (Item 1490 #22s)
Health & Human Resources
Secretary of Health & Human Resources
Transfer of adult services and licensing
House: Language directs the Secretary, in cooperation with the Commissioners of the Departments of Aging and Social Services, to develop a plan to transfer adult services and adult services licensing from the Department of Social Services to the Department for the Aging by Fiscal year 2011. (Item 282 #1h)
Senate: Not addressed.
Auxiliary grants for additional housing purposes
House: Directs the Secretary to provide a report on the programmatic, regulatory, and statutory changes needed to develop and implement a budget-neutral housing program on a pilot basis that would allow mentally-disabled consumers to use Auxiliary Grant payments for housing arrangements other than assisted living facilities. Report due 12/1/08. (Item 282 #2h)
Senate: Requires by 11/1/08 the implementation of a program to allow the use of Auxiliary Grants to pay for housing of consumers who receive case management services from a community services board (CSB) and who are eligible for or are already receiving auxiliary grants. (Item 282 #1s)
Comprehensive Services for At-Risk Youth and Families
Local administrative costs
House: Does not address
Senate: Directs the Secretary of Health & Human Resources to work with VML, VACo, local social services executives and state agencies to review and develop options for revising the funding formula for local administrative costs for the CSA program. Report is due to Senate Finance and House Appropriations by 12/1/08. (Note: localities currently pay at least 90 percent of the administrative cost of this program.) (Item 282 #2s)
State-local match rate workgroup
House: Directs the Secretary of Health and Human Resources to establish a workgroup (including local government representation) to assist in the implementation of a system of differential match rates for community-based and residential services for children in CSA to encourage greater use of community-based services. Language calls for a more gradual phase-in of changes in local match rates for community-based services (beginning July 1, 2008), and for residential services (beginning Jan. 1, 2009) than was in the introduced budget; also changes the criteria for raising the local match for residential services than in the introduced budget. (Item 283 #1h)
Senate: Directs a workgroup (similar to House approach) to be established for similar purposes; requires guidelines regarding CSA match rates by 1/1/09. Also calls for annual reports from the State Executive Council on incentives and disincentives, as well as technical assistance and other help to localities for transitioning individuals to community-based care. Language calls for a more gradual phase-in of changes in local match rates for community-based services and for residential services than in the introduced budget, and also changes the criteria for increasing the local match for residential services than was in the introduced or in the House budget. (Item 283 #1s)
Foster care maintenance payments
House: Does not address (retains the amounts from the introduced budget).
Senate: Reduces the amount from the introduced budget for maintenance payments made to CSA foster family homes by $380,293 in FY09 (a five percent decrease) and by $549,697 in FY10. The introduced budget included a 15 percent increase in the first year and a 10 percent increase in the second year to help foster care families and encourage retention of these families in the system. (Item 283 #2s)
Foster care recruitment & retention
House: Eliminates $2.2 million each year in new funding from the introduced budget for recruitment and retention of foster care parents. (Item 342 #1h)
Senate: Subtracts $1.7 million each year (general fund) and $.6 million each year (non-general funds) from the $6.9 million in additional funding in the introduced budget to be used for recruitment and retention of foster parents. The funding in the introduced budget was intended for foster family recruiters, funding for localities to support foster families, equipment, and coordinators. This retains $3.5 million each year for these purposes. (Item 339 #1s) Another amendment reduces by $1 million each year funding to increase the number of visits caseworkers make to foster families. (Item 342 #2s)
Use of Medicaid
House: Adds language requiring community policy and management teams (CPMTs) to use Medicaid-funded services whenever available for the appropriate treatment of children in CSA. Prohibits use of state pool funds for CSA services that can be funded through Medicaid. States that this would save the state $2 million in the second year. (Item 283#2h)
Senate: Does not address.
CSA trust fund
House: In the second year, supplants $965,579 in general funds with TANF funds for those communities that funding from the CSA trust fund. There is no reduction in the amount of the trust fund. (Item 283 #1h)
Senate: Does not address.
Children's mental health services
House: Specifies that new funding for children's mental health services shall be used to allow access to outpatient clinician services for both CSA mandated and non-mandated children referred to community services boards (CSBs) for treatment by family assessment and planning teams (FAPTs) through CSA. The introduced budget opened services only to non-mandated children. (Item 316 #3h)
Senate: Does not address (keeps language from introduced budget).
Foster care training programs
House: Eliminates $2.2 million in new funding each year from the introduced budget for training of foster care and adoption workers. (Item 342 #2h)
Senate: Reduces funding by $1.6 million the first year and $1.2 million the second year from the new funding in the introduced budget for training of foster care and adoption workers (Item 339 #2s)
Mental Health, Mental Retardation and Substance Abuse Services
Mental retardation waivers
House: Adds $1.6 million each year to fund 800 new mental retardation waiver slots over the two years to help individuals in need of services and housing in the community. (Item 316 #1h)
Senate: Does not address (retains amounts from the introduced budget).
CSB standards and monitoring
House: See next item.
Senate: Reduces funding and one staff position in FY10 in DMHMRSAS that was to help develop core standards and service improvement plans for services provided through community services boards. Retains $300,000 each year for this function. (Item 312 #2s)
Mental health reform issues
House: Deletes language from the introduced budget that allocated specific funding for community mental health services. Instead, pools the $13.3 million the first year and $20.6 million the second year and directs the Commissioner of mental health to determine, with a work group, how to allocate the funding to meet the needs for new requirements regarding emergency services, crisis stabilization services, case management, and inpatient and outpatient mental health services. The new requirements come from HB 559, HB 560, and HB 267. (Item 316 #2h)
Senate: Language directs the Commissioner to work with CSBs to develop standardized reporting mechanisms to track CSB performance in crisis intervention, emergency custody, temporary detention, and commitment procedures. (Item 316 #1s) Another amendment requires the Commissioner to report on the allocation formulae used to distribute new funding from the introduced budget and report annually on the outcomes achieves from additional funding for emergency services, case management services, and outpatient mental health services for children and adults. Does not redirect funding as in the House amendment. (Item 316 #3s)
Availability of psychiatrists
House: Does not address.
Senate: Language directs the Commissioner to review and report on the availability of psychiatrists in Virginia, their role in emergency custody orders, temporary detention, etc.. Also report on methods to increase recruitment and retention of psychiatrists. Report due 12/1/08 to House and Senate budget committees. (Item 316 #2s)
Veterans' behavioral health services
House: Does not address.
Senate: Contingent on passage of SB 297, provides $500,000 in the first year to address the mental health needs of veterans who are not eligible for behavioral health services through the federal Dept. of Veterans Affairs. (Item 315 #3s)
Housing and other services for people with intellectual and developmental disabilities
House: Does not address.
Senate: Directs the Department of Mental Health, Mental Retardation and Substance Abuse Services to work with statewide groups and state agencies to develop a report on investment models and best-practices for the development of affordable and accessible housing for this population, as well as access to transportation and use of informal and formal support services critical to the success of maintaining residences in the community. Report is due 10/1/08. (Item 315 #4s)
Social Services
Offender re-entry pilot programs
House: Eliminates the funding from the introduced budget for new case managers to supplement services in five reentry pilot programs that offer specialized assistance to ex-offenders. (Item 338 #3h)
Senate: Does not address.
Required consolidation of local social services offices
House: Directs the Commissioner of Social Services to work with local governments to consolidate the administrative operations of local social services offices in localities with 2007 provisional population estimates of less than 20,000. This affects approximately 45 localities that currently operate a single-jurisdiction department of social services. This amendment states that the commonwealth could save $1 million dollars in the second year through consolidations. (Note: A past study concluded that no real savings would accrue from such consolidation). (Item 339 #1h).
Senate: Does not address.
Domestic violence programs
House: Provides an additional $200,000 each year for established (not new) local domestic violence programs for the purchase of crisis and core services for victims, including 24-hour hotlines, emergency shelters, and other crisis services. (Item 341 #1h)
Senate: Does not address.
Auxiliary grants
House: Reduces funding to this program by $1 million each year, to reflect revised spending estimates for this program. (Item 341 #2h)
Senate: Same as the House (Item 341 #1s)
Title IV-E Foster Home Payments
House: Does not address.
Senate: Reduces funding by $1.1 million the first year and $1.6 million the second year (general fund) and $.8 million the first year and $.9 million the second year (non-general fund) for maintenance payments made to federal Title IV-E foster family homes. A similar amendment reduces payments for CSA foster care payments. (Item 342 #1s)
Office of Immigrant Assistance/Office of Newcomer Services
House: Redirects $200,000 each year in new funding for the Office of Newcomer Services to be used instead for a new Office of Immigrant Assistance, pursuant to HB 1174. (Item 343 #1h)
Senate: Eliminates the $250,000 each year from the introduced budget for an Office of Newcomer Services. (Item 343 #1s)
Judiciary / Drug Courts
House: Eliminates $2.95 million each year in general fund support for 14 current drug court programs. (Item 38#1h)
Senate: Does not address.
Natural Resources
Water Quality Improvement Fund Interest Appropriation – Department of Conservation and Recreation
House: Eliminates the funding scheme proposed by the Governor. In its place, approved $6 million from the general fund and $9 million from the WQIF reserve fund in fiscal year 2009. For the second year, sets aside $15 million in a special revenue reserve fund that can be tapped for WQIF if FY 2009 revenue collections meet or exceed the official revenue projections. Contingent on the passage of HB 1335, these funds would be deposited into the newly created Virginia Natural Resources Commitment Fund for the implementation of agricultural best management practices. (Item 361 #2h, Item 361 #3h and Item 473.1 #1h)
Senate: Replaces $6 million from the general fund with $6 million in interest earnings on the WQIF. (It is projected that the fund will earn $12.5 million in interest in FY 2008 and $2.5 million in FY 2009.) These funds would be deposited to the Virginia Natural Resources Commitment Fund if SB 511 is enacted. (Item 361 #10s)
Virginia Water Revolving Loan Fund – Department of Environmental Quality
House: Eliminates $1.2 million in general fund support to match federal dollars for the Virginia Water Facilities Revolving Loan Fund (Item 368 #2h).
Senate: Not addressed.
Non-state agencies and miscellaneous
House and Senate: Removes funding for 36 non-state agencies included in the introduced budget, at a savings of $5.75 million in FY10. (Item 493 #1h, Item 493 #1s)
George Mason University
House and Senate: Includes language to specify that if the administrative building on the Fairfax Campus of George Mason University is built on land not owned by the university the Commonwealth's exemptions from local oversight will continue. (Item C-35 #1h, Item C-35 #1s)
Public Safety
Jail capacity and staffing
House: Language directs the Compensation Board, with the Secretary of Public Safety and certain state departments, to determine the resources needed to establish standards for operational capacity and staffing standards for each local and regional jail, when these facilities are under and over capacity. (Item 76 #3h)
Senate: Similar to House language. (Item 76 #2s)
Report on jails and mental health issues
House: Does not address.
Senate: Language directs the Compensation Board to annually report on the number and diagnoses of inmates with mental illness in local and regional jails; the treatment services provided; and expenditures on jail mental health programs. (Item 70 #4s)
Criminal Justice Services
Training in Spanish and immigration law
House: Does not address.
Senate: Provides $150,00 each year to the Virginia Center for Policing Innovation for basic training for local law enforcement agencies regarding immigration law and the Spanish language. (Item 395 #1s)
Regional criminal justice training academies
House: Supplants current funding with $1.1 million in state assistance to local law enforcement (HB 599) each year to help support these academies. (Item 395 #2h)
Senate: Provides an additional $275,000 each year from non-general funds for these academies. The additional funds reflect anticipated revenues from court fees, which are allocated by law to the academies. (Item 395 #7s)
School resource officers
House: Supplants current state funding with $1.5 million in state assistance to local law enforcement (HB 599) each year to pay for school resource officer incentive grants. (Item 395 #3h)
Senate: Does not address.
Juvenile Justice
Study of gang activity
House: Does not address.
Senate: Directs the Department of Juvenile Justice to study the effect of juvenile gangs on the operation of court services units, local and regional detention facilities, and state juvenile correctional facilities. Also report on programs the department has developed to address gang activity and recommendations for further action. Due 9/1/08. (Item 410 #1s).
Study of VJCCCA and other prevention programs
House: Does not address.
Senate: Directs the Department of Juvenile Justice to prepare a report on the level of federal, state, and local and other funding of current juvenile delinquency prevention programs in Virginia, and an assessment of the current state of evaluation research in juvenile delinquency prevention, both in Virginia and nationally. This report shall include a review of the current use of funds provided through the Virginia Juvenile Community Crime Control Act (VJCCCA). Report is due 9/1/08. (Item 410 #2s)
Transportation
Taxes
The Senate budget package includes $147.2 million of additional motor fuels taxes pursuant to SB 713. The additional dollars are appropriated to the Highway Maintenance and Operating Fund. However, the House Finance Committee tabled the measure on February 25th, nullifying the Senate's action.
The House budget package does not include any new or increased taxes. The House amendments do not address the maintenance issue.
General funds and debt
Both the House and Senate budget amendments remove $180 million of general fund dollars from transportation. The House approved amendments authorizing the Commonwealth Transportation Board to issue $180 million of bonds to pay for transportation projects approved by the 2007 session of the General Assembly. The Senate did not address the funding issue for these specific projects.
Transit
Both the House and Senate budgets reduce the appropriations providing financial assistance for public transportation by $12.9 million in fiscal year 2009 and by $8.6 million in fiscal year 2010. The reductions reflect declining revenues in the Transportation Trust Fund and recordation taxes.
The House package includes a policy directive in HB 29 requiring the Secretary of Transportation to resolicit competitive proposals for the design-build of the Dulles Corridor Metrorail Project. The Senate package does not include a similar amendment.
Vehicle Registration Fee
The House did not accept the governor's proposal to continue the additional $1.00 vehicle registration fee initially assessed to support the Jamestown 2007 Commemoration. The funds were to be used to implement the federal Real ID Act, marketing and advertising initiatives of the Virginia Tourism Authority, efforts to improve security and reduce driver's license fraud, and land conservation. The Senate agreed to the governor's proposal.
New construction
Neither package includes new revenues for road construction.
Because of declining revenues and the elimination of the abusive driving fees, the current Six Year Program will be reduced by $1.1 billion. Transit allocations will be reduced by some 10 percent. Primary, secondary and urban highway construction will be reduced by approximately 44 percent.
Local issues
Each chamber provides specific items of interest to localities. The House amendments include language clarifying that projects developed under local design-build provisions are eligible to receive grants from the Transportation Partnership Opportunity Fund.
Other transportation amendments of local concern are:
McLean: sound wall on Route 123 Chesterfield: interchange improvement at Meadowville Technology Park Loudoun County: access road connecting Shaw Road to Route 28 McLean: sound wall on Route 123 Henrico County: changing rate of maintenance payments Powhatan County: improvement study on intersection of Route 522 and 617 Virginia Beach: improvements to Lessner Bridge Alexandria: improvements to Edsall Rd
III. Proposed Changes to FY08 (caboose budget)
Direct Aid to Education
Lottery profits.
House and Senate: Language to use $31.8 million of unanticipated lottery profits in FY08 to help pay the state's share of basic aid in education. The amount, but not the language, was included in the introduced budget. Typically about $12 million of the $31.8 would be distributed directly to localities and school divisions. (Item 135 #1h, Item 135 #2s)
Sales tax
House and Senate: Decrease projected distribution of sales tax revenues to reflect updated revenue forecast, for a savings of $5.7 million in FY08. This is a net figure that reflects the increase in state aid for basic aid payments. When sales tax goes down, the state and local required share of basic aid goes up. (Item 135 #4h, Item 140 #1s)
Hold harmless
House: Allows localities that have met their required local effort to carryover into the next fiscal year any remaining state fund balances available to help minimize any revenue shortfall related adjustments that may occur in state funding. (Item 135 #5h)
Senate: No action.
Health & Human Services: Comprehensive Services Act
House: Directs the Secretary of Health & Human Resources to establish a work group to prepare for the implementation of a differential match structure for community-based and residential services. The work group also is directed to consider future actions to improve the quality of care, maximize cost effectiveness, and achieve administrative efficiencies in the CSA program, such as: 1) using a managed care approach to care coordination/utilization management; 2) using community services boards for care coordination and monitoring of children with behavioral health diagnoses; 3) better communication and cooperation on issue related to special education and development of individualized education plans (IEPs) as it affects CSA; 4) better communication and coordination with court services units, J&DR judges, and the state juvenile justice department regarding plans of care for "children in need of services" as defined through the interagency guidelines released in 2007. This study would continue into the new biennium. (Item 279 #1h)
Senate: Does not address.
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