eNews

 

In this issue:

• Supreme Court overturns Quill Decision
• National economic trends demand closer scrutiny
• Virginia economy continues to hum
• VDSS to provide additional administrative funding in FY2019
• Medicaid expansion information available
• Public comment open on review of DEQ permitting, monitoring, enforcement
• Public comment open regarding revamp of CSA assessment tool policy
• State Board of elections ponders voting issues
• Code Commission discussed Section 15.2
• Evictions Workgroup meeting focuses on tenant rights
• FOIA meetings subcommittee defines public record and social media
• VLGMA elects officers and board
• Register now for 2018 VML Annual Conference

 

U.S. Supreme Court overturns Quill Decision

Policy Questions Must Be Answered Before Additional Sales Tax Dollars Can Be Collected.

By a slender 5-4 vote the U.S. Supreme Court reversed a decades-old previous court decision that basically prohibited any state from requiring on-line retailers who are not physically present in a state from collecting and remitting sales taxes. The Supreme Court overturned its 1992 ruling in Quill Corp. v. North Dakota, deciding in the new case (South Dakota v. Wayfair, Inc.) that the physical presence rule of Quill is both unsound and incorrect.

In a presentation to the Senate Finance Committee earlier in June, Secretary of Finance Aubrey Layne said a favorable ruling could boost Virginia tax revenue by up to $300 million a year. A 2013 Fiscal Impact Statement prepared by the Virginia Department of Taxation for HB 2313 estimated that local sales tax revenues could increase by $60 million a year.

It is important to note that this is not a new tax. Under existing state law, consumers already owe the tax. It is too impractical for the state tax department to collect sales taxes if an on-line retailer without a physical presence in Virginia chose not to do so. The Court’s decision removes the collection hurdle.

Before the new money makes its way into the state treasury, however, there are other obstacles and policy questions.

First and foremost is the possible action that Congress could take. Congress could write its own rules, defining what goods or services are subject to taxation, establishing a minimum threshold of sales transactions and/or gross dollar sales to exempt small businesses from collecting the taxes, junking the various states’ sales tax rates in favor of a single interstate tax rate, or setting up accounting, auditing and recordkeeping requirements different from state standards and practices. And, any federal law would pre-empt a state statute.

At the state level, Gov. Northam and the General Assembly would have to decide in the 2019 session or in a special session in the Fall if the allocation formulae for the on-line sales tax revenues spelled out in HB 2313 remain relevant; if the additional money should go to the state general fund or be dedicated for transportation purposes; or if any action taken on this issue be built into an overall tax reform initiative. The tax changes made at the federal level, the provider taxes approved by the General Assembly for Medicaid expansion, and the revenue surplus projected for FY 2018 might persuade state legislators (in an election year) that a reduction in motor fuels taxes would be a good policy objective.

 

National economic trends demand closer scrutiny

As the U.S. economy closes in on nine years of economic expansion there are potential signs of trouble ahead that could affect the Virginia economy. Here are three items to watch over the coming months.

Interest Rates:

The first item is the “yield curve.” The yield curve is the difference between interest rates on short-term U.S. government bonds like two-year Treasury notes and long-term government bonds like 10-year Treasury notes.

In a healthy economy, the interest rate on longer-term bonds runs higher than the rate for short-term notes. The higher rates are driven by the risk that strong economic growth over time could set off a broad rise in prices. Think inflation.

In a recent article in The New York Times, it was reported that long-term bond yields have been slow to rise, suggesting that bond traders are concerned about long-term growth even though the national economy continues to grow. At the same time, the Federal Reserve Bank has been raising short-term interest rates, resulting in a shrinking gap between short-term and long-term rates. Last week, the gap was roughly 0.34 percentage points. It was last at these levels in 2007 when the U.S. economy fell into the Great Recession.

If the yield curve is inverted, meaning long-term interest rates fall below short-term rates, economists view this as recession tripwire. Every recession of the past 60-years has been preceded by an inverted yield curve. According to the San Francisco Federal Reserve Bank, curve inversions have correctly signaled all nine recessions since 1955 and had only one false positive, in the mid-1960s, when an inversion was followed by an economic slowdown but not an official recession. In the past a recession has come as soon as six months or as long as two years after the inversion.

Federal Deficit:

The Congressional Budget Office (CBO) released earlier this week a report showing that government debt is on track to hit historically high levels and at its current growth rate will be nearly equal in size to the U.S. economy by 2028. By the end of calendar 2018, the ratio of federal debt to the U.S. gross domestic product will reach 78.0 percent, which is the highest ratio since 1950.

The previous record set in 1946 was driven by a spending push to fund World War II. The current bump comes amid a healthy economy, suggesting a major structural gap between the federal government’s revenues and spending.

The impact of federal tax changes approved in 2017 is debatable. Those changes included cuts to the individual income tax which are slated to expire before the end of the 2020 decade. If the tax breaks expire, the impact of the 2017 federal tax changes on the nation’s debt is projected to be modest. However, if the individual income tax cuts are extended, the projected additions to the federal deficit would increase dramatically. The CBO projects rapid growth in the amount spent on debt interest payments. Interest costs are expected to double as a share of the economy over the next decade and even overtake by 2048 the cost of funding Social Security, which is currently the greatest expenditure in the federal budget.

Trade:

More than 10.0 million American jobs, according to the U.S. Department of Commerce, are supported by exports. More than half of U.S. imports are considered intermediate inputs or capital goods, meaning American producers incorporate these items in their own manufacturing or commercial enterprises. A full-scale trade war with China, the European Union and the two other members of the North American Free Trade Agreement (NAFTA) will raise costs for businesses and consumers.

Trade wars are not good and are not easy to win. Most economists say it is unlikely that the U.S. economy would fall into a recession just on trade alone, but they do agree that a trade war is likely to curtail growth as businesses suspend hiring more workers, building new factories, or investing in additional equipment. Even the uncertainty that accompanies the talk of trade wars can affect economic activity.

Virginia has an important stake in international trade. The Port of Virginia reports that 374,000 jobs or 9.4 percent of the state’s resident workforce are employed in port-related jobs. Port-related economic development drove $1.6 billion in capital investment in 2017. Over 700 internationally-owned companies have located in the Commonwealth.

The Ports of Hampton Roads have the third largest market share of all the U.S. east coast ports and the sixth largest of all U.S. ports. Only the ports of New York/New Jersey and Savannah pull down larger market shares on the east coast.

2017 Total Cargo in Millions of U.S. Dollars
Rank	Exports	Value		Rank	Imports	Value
1	China	$3,065		1	China	$11,193
2	Brazil	$2,212		2	Germany	$6,189
3	Belgium	$1,947		3	India	$2,845
4	United Kingdom	$1,542		4	Italy	$2,432
5	Germany	$1,510		5	Japan	$2,124
6	Netherlands	$1,330		6	Malaysia	$1,556
7	Japan	$1,020		7	France	$1,555
8	India	$816		8	Vietnam	$1,491
9	Spain	$781		9	Brazil	$1,434
10	Austria	$685		10	United Kingdom	$1,262
Source: The Port of Virginia

 

When ground transportation is considered, exports from Virginia to Canada exceed those to China and Virginia exports to Mexico rank third largest.

Most of the nations listed as Virginia’s top traders are those targeted for higher tariffs by President Trump.

The top goods exported from Virginia are in the graph below. If China slaps on additional tariffs on soybeans and soybean products processed in Virginia, it will hurt the state’s agricultural and agribusiness community.

 

Virginia economy continues to hum

The Virginia Employment Commission released last week employment information for the month of May. The seasonally adjusted unemployment had dropped 0.1 percentage point to 3.2 percent. This is more than a half percentage lower than the rate a year ago. In fact, this is the lowest unemployment rate since the October 2007 rate of 3.2 percent.

The state labor force grew in May by 7,656, which was the fourth consecutive monthly increase, raising the number of working Virginians to a record-high 4,338,619. From May 2017 to May 2018, Virginia’s seasonally adjusted total nonfarm employment was up 53,000 jobs, or 1.3 percent. Over-the-year employment growth in the state has been positive for 50 consecutive months.

As for housing markets, housing starts in April were up 5.4 percent over the same period a year earlier. According to CoreLogic Information Solutions, Virginia homes appreciated 0.6 percent in April and rose 3.0 percent on a year-over-year basis.

Regarding military spending, both the U.S. House of Representatives and the U.S. Senate have passed their respective versions of next fiscal year’s defense spending authorization bills. Major provisions that affect Hampton Roads are included in the two bills known as the 2019 National Defense Authorization Act (NDAA).

The spending plan includes $12.3 billion for shipbuilding projects that benefit Virginia, with the bulk of the money going to Newport News Shipbuilding. There is also funding for the Norfolk Naval Shipyard in Portsmouth to expand its civilian workforce, perhaps by as many as 500 more workers. And, there is funding for projects at Oceana Naval Air Station and its Dam Neck Annex as well as for Joint Base Langley-Eustis.

Also, in the news was Gov. Northam’s announcement earlier in the week of a partnership with Newport News Shipbuilding to support a major hiring initiative – 7,000 people including the creation of 2,000 new jobs in the City of Newport News over the next five years.

What appears to be the only cloud in the sky is the statistic showing Virginia’s labor participation rate stuck at below the pre-Great Recession level. Without new workers moving to Virginia it may prove difficult to meet job demand in an expanding economy.

 

VDSS to provide additional administrative funding for coming fiscal year

On June 8, Virginia Department of Social Services (VDSS) Commissioner Duke Storen officially notified local social services directors that the state will provide additional administrative funding to assist local DSS offices with increased eligibility caseload  due to Medicaid expansion during Fiscal Year 2019.  This funding will not require a local match during FY2019 only.

In addition, each local DSS director was notified on June 8 the amount of the additional administrative funding to their office.

Local allocations were determined using three equal factors:

1. Distribution of current funding versus current workload for benefit program specialists
2. Projected increase in workload due to Medicaid expansion (minimum allocation of $45,000)
3. Historical staff and operations (budget lines 855 and 858) spending

This funding is only appropriated for Fiscal Year 2019, which means local governments will need to address with the state any additional assistance after that fiscal year.

Contact: Janet Areson (jareson@vml.org)

 

Medicaid expansion information available

On June 7, ​Governor Ralph Northam signed into law the State’s 2019-20 biennial budget, which included expanded eligibility for new health coverage to approximately 400,000 Virginia adults.  Coverage will begin on January 1, 2019.

The Cover Virginia website is designated as the main source of information for consumers and stakeholders about the new coverage.

Initial information has already been posted at www.coverva.org.  Virginia Medicaid will continue to post regular updates as new details become available; you can bookmark the address and check in regularly to see the latest information available on the roll out of the program. You can also put this link on your website so that residents interested in finding out more about the program can link directly to it.

Contact: Janet Areson (jareson@vml.org)

 

Governor invites public comment on review of environmental agency’s permitting, monitoring and enforcement activities

On April 4, Gov. Ralph Northam signed Executive Order 6 which requires the Department of Environmental Quality (DEQ) to review its performance and report to him by April 30, 2019 with recommendations. The executive order directs the state agency to report monthly to the Secretary of Natural Resources on the progress of the reviews.

The executive order states that public health, recreational opportunities, safe drinking water, economic vitality, and quality of life are directly linked to a health environment. “It is critical that the Commonwealth’s natural resource agencies have the tools necessary to protect and improve our environmental quality.”

Under the Executive Order, the DEQ Director will take these actions:

• Review DEQ’s permitting, monitoring, and enforcement activities across the air, water, and solid waste programs;
• Evaluate every proposed federal regulatory or guidance modification released after January 20, 2017, regarding air, water, and solid waste to determine the impact on public health, drinking water supplies, and land and water protection; and
• Work with stakeholders to improve communication with the public and the regulated community and provide more opportunities for proactive education, especially among underserved and lower income populations.

The public is invited to comment on the review through August 31, 2018. (Click here.) Comments submitted thus far have singled out issues concerning stormwater regulations, regulatory stability, adequacy of DEQ funding, agency transparency, and greenhouse gas monitoring.

 

State Board of elections ponders voting issues

The State Board of Elections met on June 19^th and discussed the misassigned voters in Virginia.   First, they discussed who is responsible for drawing what lines as well as the structure at the local level.  Each County and City has an electoral board which is appointed by the Chief Judge, is comprised of 3 people, 2 of which are of the prevailing political party having the highest number of votes in the Commonwealth for the last election for Governor and the third from the second highest number of votes. The Electoral Board appoints a general registrar. Then there is the State Board of Elections which is 3 members appointed by the Governor from qualified voters and again with the political party representation the same as the local electoral board; they are subject to confirmation by the General Assembly.

For the law; the Code of Virginia does not provide any single entity the authority to modify local election district lines. The General Assembly draws the Congressional, House and State Senate District lines, the localities draw local office district lines and voting precincts (not the Registrar, the governing body). To add to the mix, changes to locality lines or precincts after 2011 cannot be considered when looking at voting precincts. (See VA Code 24.2-302.2(c))

They also discussed the role of the Department of Elections (ELECT) who is the conduit for the district lines and voting precincts but has no authority or oversight in ensuring that voters are properly placed. ELECT uses GIS mapping software along with the US Census block data to assist in this process.     The study identifying potential mis-assigned voters were mostly “edge cases” meaning that they were on the outer limits of the districts. Reasons for the miss assignments appear to be human error, historical disputes of county lines and a misunderstanding of the use of precinct descriptions along with informal agreements between localities or the incorrect use of county information (where taxes are paid, or utilities are servicing a property).   There is regulation that says that you “vote where you sleep” (1 VAC 20-40-30(E)) states that if your house straddles a jurisdictional boundary line that you vote where your usual sleeping area is.

At the end of the State Board of Elections meeting, it was clear that they wanted to fix this matter but pondered who ultimately was responsible for the errors … there was no answer.   Chris Piper, Commissioner of the Department of Elections committed to working with localities and the Board on this issue but indicated that the responsibility currently lies in a lot of places. VML and VACo will be meeting with Mr. Piper on Friday to ask for further guidance on this matter.

Here are the relevant materials. https://www.elections.virginia.gov/Files/Media/Agendas/2018/20180619BWP.pdf

Contact: Michelle Gowdy (mgowdy@vml.org)

 

Code Commission discussed Section 15.2

The Code Commission met on June 18^th and further discussed the items in Section 15.2 of the Virginia Code that are not set out in the code. The list is in the link below along with the recommendations from staff.   http://codecommission.dls.virginia.gov/documents/2018/06-18-2018MeetingBinder.pdf. This will be discussed further at their next meeting which is on August 6^th; they wanted to wait until all of their members were present before taking action.

Contact: Michelle Gowdy (mgowdy@vml.org)

 

Evictions Workgroup meeting focuses on tenant rights

The Housing Commission created an evictions workgroup which met on June 19^th to discuss the following questions:

1. Should there be more than one right of redemption if the tenant pays in full during a 12-month period?
2. Should the landlord’s pay or quit deadline be extended from 5 days to something more?
3. How can we facilitate or incentivize the rental of residential properties by landlords to low-income and moderate-income individuals?

The group consisted of housing advocates, apartment owners or their association, the homebuilders of Virginia, local government and realtors. After a lengthy discussion, everyone agreed to continue discussing question 1 and agreed that there was no consensus on questions 2 & 3. There will be another meeting in the fall.

Contact: Michelle Gowdy (mgowdy@vml.org)

 

FOIA meetings subcommittee defines public record and social media

The FOIA Meetings Subcommittee met on Wednesday of this week to discuss the definition of public record and social media as well as trade secrets and proprietary records.  Senator DeSteph who patroned SB730 in the 2018 General Assembly Session was not able to attend so the subcommittee did not discuss the definition of public record and social media.   The draft of the revised bill only applies to the General Assembly members, but I urge you to review it here: http://foiacouncil.dls.virginia.gov/subcom_mtgs/2018/LD0055.pdf

With regard to trade secrets and proprietary records, staff reported that this has been discussed at over 30 meetings and no consensus has been built.   After a lot of discussion, primarily centered around fracking and the disclosure of chemicals, the subcommittee asked that two drafts be presented at their August 8^th meeting – one draft related to the fracking issue and one with a general trade secret exemption.

Contact: Michelle Gowdy (mgowdy@vml.org)

 

Public comment open regarding revamp of CSA assessment tool policy

Local officials have until August 10, 2018, to comment on whether the State Executive Council for the Children’s Services Act (CSA) should revise its policy governing the use of the Child and Adolescent Needs and Strengths (CANS) assessment tool. CANS is a uniform assessment tool mandated for use by local government staff and others who work with children served under CSA.

The State Executive Council (SEC) approved the public comment period at its meeting on June 21 in Richmond. The public comment being sought is whether policy revisions should be advanced (no revisions are yet known; a policy draft from the Office of Children’s Services will be given to the SEC at its September meeting); public comment may also offer suggestions for the substance of the policy.

The Code of Virginia requires that localities use a uniform assessment instrument to identify levels of risk (and subsequent progress or not) of CSA youth, and to report client-specific assessment information in the CSA database. A locality’s reimbursements from the CSA funding pool depends on its demonstrated use of an assessment instrument. CANS is the assessment tool most recently adopted by the SEC for use by localities; it has been in use for approximately nine years.

SEC policy regarding the use of CANS is minimal; it states that CANS shall be the uniform assessment instrument for children receiving services funded through the CSA pool of funds. Additional guidance from the Office of Children’s Services has been developed over the years regarding administrative aspects of the use of CANS, such as frequency of administration, entry of information into the state’s database, and certification requirements for those performing the CANS assessments.

Along with OCS policy and guidance, localities must also abide by Medicaid requirements for timing and frequency of CANS assessments if a child receives Medicaid-funded services.

The Office of Children’s Services has convened a workgroup to try to clarify guidance for local government regarding the use of CANS, such as time frames for its administration, the appropriate use of the comprehensive version versus the reassessment version, and the purpose and timing of the discharge CANS (done when a child is leaving CSA coverage or moving out of a locality). Information from this workgroup will likely inform the policy draft that will be given to the SEC in September.

Comments can be submitted via the Public Policy Comment Forum on the CSA website (preferred method) (www.csa.virginia.gov) or via US Mail to the Office of Children’s Services at 1604 Santa Rosa Rd. Suite 137, Richmond VA 23229 or e-mail to: csa.itsupport@csa.virginia.gov. The public comment period for this Notice Stage will end at 5:00 PM on August 10, 2018.

Contact: Janet Areson (jareson@vml.org)

 

VLGMA elects officers and board

Chesterfield County Administrator Joseph Casey will lead the Virginia Local Government Management Association (VLGMA) as its president in the coming year. Casey takes over from Charlottesville City Manager Maurice Jones, who served as VLGMA president for 2017-2018. The election of officers and board members took place during the Association’s annual conference in Virginia Beach last week.

Joining Casey as an officer in the Association are Rocky Mount Town Manager James Ervin as president-elect; Falls Church Assistant City Manager Cindy Mester as first vice president; Montgomery County Administrator Craig Meadows as second vice president; Vienna Town Manager Mercury Payton as third-vice president, and Augusta County Administrator Timothy Fitzgerald as secretary. Maurice Jones will become Immediate Past President.

New board members for the Association are Roanoke County Assistant Administrator Richard Caywood; Scottsville Town Administrator Matt Lawless; York County Deputy Administrator Vivian McGettigan; Manassas City Manager Pat Pate; Lexington City Manager Noah Simon; and King George County Administrator Neiman Young.

These new board members join current board members: Alexandria Deputy City Manager Debra Collins; Chesapeake Deputy City Manager Laura Fitzpatrick; Winchester City Manager Eden Freeman; New Kent County Administrator Rodney Hathaway; Madison County Administrator Jack Hobbs; and Staunton Deputy City Manager Steven Rosenberg.

VLGMA, a state affiliate of the International City/County Association (ICMA), is an affiliate organization of VML; Janet Areson serves as its executive secretary.

 

2018 VML Annual Conference and Mayors Institute – plans are under way

On-line registration is open; Preliminary agendas posted

Don’t forget to register for the 2018 Annual Conference, to be held Sept. 30 through Oct. 2 at the Hampton Convention Center! Conference updates, preliminary agenda, hotel information, and on-line registration are here. Also, the conference concludes Tuesday evening with a reception and banquet dinner.

Prior to the conference, you may also want to attend the 2018 Mayors Institute on Saturday, Sept. 29, and will conclude at noon on Sunday, Sept. 30. This two-day program exposes mayors and vice mayors to issues essential to their roles as local government leaders. The Virginia Mayors Institute includes a reception and dinner and is held in conjunction with the VML Annual Conference.

Contact: Leslie Amason (lamason@vml.org)

 

Institute for Local Officials begins July 19 – register now

The Institute for Local Officials will be held July 19-20, 2018, at the Hilton Richmond Downtown. The Institute offers key training for newly elected officials, as well as, veteran officials and will include topics such as council manager relations; Freedom of Information Act, budgeting basics and understanding the conflicts of interest law. More information and registration for the Institute for Local Officials may be found here 2018 Institute for Local Officials Registration

Contact: Leslie Amason (lamason@vml.org)

 

 

In this issue

• Register now for 2018 VML Annual Conference
• Institute for Local Officials scheduled for July; Policy committees meet July 19
• Draft annexation study released; Public hearings scheduled
• VDOT Local Assistance Division Newsletter posted
• FY2018 state surplus may exceed $400 million: State’s AAA bond rating affirmed
• Information on state payments, local required shares for K-12 released

 

Register now for 2018 VML Annual Conference

On-line registration is open; Preliminary agenda posted

On-line registration is now open for the 2018 Annual Conference, to be held September 30 through October 2 at the Hampton Convention Center! Conference updates, preliminary agenda, and on-line registration are here. Please note that the conference concludes Tuesday evening with a reception and banquet dinner.

If you haven’t reserved a room, reservations may be made on-line here.

Also, don’t forget the 2018 Mayors Institute, which will begin bright and early Saturday, Sept. 29, and conclude at noon on Sunday, Sept. 30, prior to the opening of the Exhibit Hall and the start of the annual conference.

 

Institute for Local Officials scheduled for July 19-20

VML will hold its Institute for Local Officials starting the evening of July 19 and all-day July 20 at the Hilton Richmond Downtown, 501 East Broad Street, Richmond, VA 23219. Register on-line here. A draft agenda is posted there as well. This conference will be an excellent overview for newly-elected officials and incumbents as well. Topics to be covered include council/manager relations, the Freedom of Information Act, the Conflict of Interests Act, budgeting and more.

Policy committees scheduled for July 19

Also, don’t forget: VML’s six policy committees will meet July 19 at the Greater Richmond Convention Center for a day of briefings and policy developments. These six policy committees create policy statements that guide VML’s lobbying efforts and steer VML’s legislative process. The committees on general laws, human development and education, and transportation will meet from 9:30 a.m. to 12 noon. The committees on community and economic development, environmental quality and finance will meet from 1 to 3:30 p.m. Lunch will be available for all committee members from 12 to 1 p.m. Having these meetings on the same day allows our members to have time to talk with each other and share rides. If membership on the committees has changed due to elections on May 1 (or other reason), let Joni Terry know (jterry@vml.org). For more information on the policy process, click here.

 

Draft annexation study released; Public hearings scheduled

The Commission on Local Government will hold a hearing in the Richmond area on Tuesday July 10, 2018, to solicit public comment on its draft study on annexation. The COLG was directed to evaluate the structure of cities and counties, evaluate the impact of annexation and consider alternatives to the current moratorium.

More details and the draft report can be found on the Virginia Department of Housing and Community Development website: http://www.dhcd.virginia.gov/index.php/commission-on-local-government/commission-on-local-government-annexation-study.html.

A public hearing will be held at 10:00 a.m. on July 10, 2018, in the Board Room at the Virginia Housing Center (4224 Cox Road in Glen Allen, VA, 23060).

An additional hearing will be held at 2:00 p.m. on September 4, 2018, in the Board Room at the Central Shenandoah Planning District Commission (112 MacTanly Place in Staunton, VA, 24401).

Any person wishing to testify before the Commission at the public hearing may register in advance through the Commission’s offices at (804) 371-8010 / Virginia Relay 7-1-1 or david.conmy@dhcd.virginia.gov.

Written testimony must be submitted or postmarked by September 3, 2018 and mailed to the Commission’s offices at: Commission on Local Government, Department of Housing and Community Development, Main Street Centre, 600 East Main Street, Suite 300, Richmond, VA, 23219. Electronic testimony may also be submitted by September 3, 2018, to the following email address: david.conmy@dhcd.virginia.gov.

Anyone requiring special accommodations for the hearing should contact the Commission’s offices at (804) 371-8010 / Virginia Relay 7-1-1 by July 1, 2018.

 

VDOT Local Assistance Division Newsletter posted

The Spring 2018 newsletter from the Virginia Department of Transportation’s Local Assistance Division is posted at http://www.virginiadot.org/business/resources/local_assistance/SPRING_2018.pdf.

The purpose of the newsletter is to communicate general information about local programs to local government and VDOT staff. The Spring 2018 newsletter highlights the 2018 Local Programs Workshop and Dashboard 4.0 scheduled to go live by July 1st.

The newsletter also provides key information for locally administered projects including requirements for inspection at fabrication facilities (Source Inspections). Finally, the newsletter includes a high-level summary of several of the programs that the Commonwealth Transportation Board will be approving funding for at their June action meeting.

 

FY2018 state surplus may exceed $400 million

State’s AAA bond rating affirmed

Strong collections of individual withholding payments in May drove year-to-date growth in state revenues, according to the May revenue letter released June 13 by Secretary of Finance Aubrey Layne.

Total general fund revenue collections rose 1.4 percent in May. On a fiscal year-to-date basis, total revenue collections rose 6.1 percent through May, ahead of the annual forecast of 3.4 percent growth. Collections in June must total $1.8 billion to attain the forecast; as a reference point, collections in June 2017 were $2.2 billion. Layne projected that the FY2018 surplus will exceed $400 million, assuming June receipts are close to forecast. The surplus will be used to increase cash reserves.

Net individual income tax collections, which are 70 percent of state general fund revenues, were up 7.7 percent over last year, ahead of the annual estimate of 3.4 percent growth. Individual income tax refunds remain a question mark, however, with Layne noting that because many high net worth taxpayers have not filed their 2017 tax returns, and, therefore, uncertainty in this area remains

The state received welcome financial news last week from S&P Global Ratings. The agency affirmed Virginia’s AAA bond rating and upgraded the Commonwealth’s financial outlook to stable. The agency had downgraded the state’s outlook from stable to negative in April 2017. The upgrade followed the adoption of the state budget that allocates more funding for the state’s primary reserve funds.

 

Information on state payments, local required shares for K-12 released

The Superintendent of Public Instruction released on June 8 a memorandum containing links to a narrative description of the budgets signed by Gov. Northam as they relate to K-12 education. Information on each school division, including the expected state payment and required local shares, can be found by following this link in the memorandum. http://www.doe.virginia.gov/school_finance/budget/calc_tools/2018-20/1820-calculation-template.xlsm.

 

In this issue

• It’s finally a wrap: Governor signs budget bill
• Legislative summaries available
• Banquet is Tuesday night at 2018 VML annual conference
• Deeds subcommittee discusses Medicaid, diversion, and capital needs
• Big changes coming for foster care system, with impact on CSA
• Proffer party update
• Updated summer meals program toolkit; Recording of May 24 conference call available
• Intercity passenger rail issues explored

 

It’s finally a wrap: Governor signs budget bill

Governor Ralph Northam signed the budget bills on the Capitol steps Thursday afternoon to an enthusiastic crowd of legislators, staff and lobbyists, including VML Executive Director Michelle Gowdy.  He thanked all the people that for years had told their stories about the need for expansion and credited former Governor McAuliffe for beginning this journey.  To no one’s surprise, Senator Emmet Hangar received many accolades for his work.

While it is good that the budget bills were signed, VML is aware of the Communications Sales and Use Tax Trust Fund “grab” to take $2.0 million each year from the Trust Fund for transfer to the state general fund. We have asked the Governor to submit amendments at the 2019 General Assembly session to rectify this action.

Make sure you’ve read VML’s article on the budget, which was sent out in the June 6 eNews.

Other information is available as well. The Superintendent of Public Instruction has posted a memorandum containing links to a narrative description of the budgets and their effect on K-12 education. The sheets for individual school divisions that detail state and local required shares is presented differently from previous years, however. Follow this link http://www.doe.virginia.gov/school_finance/budget/calc_tools/2018-20/1820-calculation-template.xlsm  to get to those sheets. At the bottom of this page, you can click to continue, and you will be taken to a different page where you can select your school division.

The State Compensation Board has sent out information on FY19 budget estimates for constitutional officers; that is posted here.

VML contacts: Michelle Gowdy, mgowdy@vml.org; Neal Menkes, nmenkes@vml.org and Janet Areson, jareson@vml.org

Legislative summaries available

VML has produced two reports on the 2018 session that should be of use. The first report details the bills affecting local government that were enacted or failed by subject area (such as conflicts, land use, etc.). The second report is a guide that identifies bills that require or allow localities to take some kind of action. Please note that this report is only a guide. The local government attorney and staff should be consulted before any action is taken. If you need either report as a word document, please email Mary Jo Fields at mfields@vml.org.

Also, the state Division of Legislative Services produces an excruciatingly detailed report on all legislation introduced in the session, organized by title of the Code of Virginia. Note that the document is 288 pages long and may take a bit of time to download.

Banquet is Tuesday night at 2018 VML annual conference

Make your room reservation now, conference registration opens soon

The 2018 Annual Conference begins on Sunday, Sept. 30, 2018 and concludes with a reception and banquet dinner on Tuesday night, October 2, 2018. Make sure you’ve made your reservation for the right days! If you haven’t reserved a room, reservations may be made on-line here.

Also, the 2018 Mayors Institute will begin bright and early Saturday, Sept. 29, and conclude at noon on Sunday, Sept. 30, prior to the opening of the Exhibit Hall and the start of the annual conference.

Registration for the annual conference will open soon.  We will send out information when it opens.

Deeds subcommittee discusses Medicaid, diversion, and capital needs

Saying that the recently-passed state budget was the most significant budget the state had seen for mental health in “maybe 200 years,” Senator Creigh Deeds, chair of the Joint Subcommittee to Study Mental Health Services in the 21^st Century, stated that the real work is just beginning for the group.  The work to be done includes incentives to build the work force to meet the needs of the state’s behavioral health system at every level, and “rightsizing” of the system to ensure that people are served in the community as well as in state facilities.

The subcommittee met on June 5 at Central State Hospital in Petersburg.  They began with a tour of the facility, which by any measure needs replacing to ensure basic health and safety for consumers and staff, as well as better accessibility for treatment needs and modern health record-keeping capability.

A total of $3 million was put into the state budget for planning; estimated costs for replacement of facilities was pegged at between $200 – $300 million.  Senator Emmet Hanger said that he thought that some of the new buildings could be modeled after Western State, which previously underwent a reconstruction, and which used modular building construction.  He expressed his wish that replacement work start sooner than later.

The criminal diversion workgroup of the subcommittee met briefly to review its proposed workplan for the year, including identifying for further analysis and study the barriers to community services boards (CSBs) providing services to jails, and reviewing data on recently approved improvements including the mental health jail screening tool, forensic discharge planning, and alternative transportation.  Members of the workgroup expressed interest in looking at the issue of limiting use of restraints in local/regional jails, and diversion of individuals with mental health issues prior to custody.  Senator Hanger said that the approved language in the budget to streamline Medicaid enrollment of inmates and overall expansion of Medicaid could allow the workgroup to look at better coordination of services with CSBs.

In the full subcommittee meeting, Senator Deeds noted that with movement to solve issues around transportation and supervision of people taken in on a temporary detention order, it could be time to look at lengthening the period of time a person could be kept for an evaluation.  Although Virginia increased the number of hours someone could be kept for evaluation, it is still one of the most restricted time periods of any state.

The subcommittee also heard presentations from the Department of Medical Assistance Services and Department of Behavioral Health and Developmental Services regarding their roles in the public health system, and in DBHDS’s case, how the Department interacts with community services boards.

The subcommittee is attempting to meet at state facilities across Virginia; the next meeting is tentatively set for Catawba Hospital.

VML contact: Janet Areson, jareson@vml.org

Big changes coming for foster care system, with impact on CSA

The federal budget signed into law by President Trump in February contained a big change for the national foster care system.  The Family First Prevention Services Act will change the priorities of the foster care system and try to keep children in their homes and out of foster placements or residential placements whenever possible.

The State and Local Advisory Team (SLAT) of the Children’s Services Act (CSA) heard on June 7 a briefing on the new law by Carl Ayers, director of family services for the Virginia Department of Social Services.  The new law may have substantial impact on CSA.  In all other states, foster care is handled by the state social services department, but in Virginia, CSA plays a major role.

Under this new federal act, which represents the first major revision of the Title IV-E foster care program since 1981, states and localities will be allowed to use federal IV-E funds for prevention as well as for foster care placements.  Prevention funds could go towards services for the child and family, not just the child.  Some Virginia local governments operate prevention programs for children through CSA, but it is not done statewide, nor is it a uniform set of programs. With this new law, the state will have to develop a statewide prevention program platform.  The federal program calls for three major service buckets within prevention:  substance abuse; mental health; and in-services such as parenting assistance and other home visiting.

All prevention programs under the new federal program will have to be evidence-based.  Ayers said that the federal government will have to create an evidence-based clearinghouse of allowable services, but in the meantime, people could look to California, which currently has such a clearinghouse.

States will also have to define what it means to be “at risk of removal” from the home, in order to use the prevention services allowed under the new law.  Ayers said that Virginia used to have a broad definition of this term, but it was subsequently narrowed significantly.  He said the state may need to reexamine the need to broaden its definition.

The IV-E program will continue to require a 50/50 state-federal match.  Ayers said that while there is no local match for IV-E, there was an open question of whether that would continue to be the case.

He said that new guidelines for use of funds could mean a savings for CSA, because every dollar that can be used for the new IV-E program could save some CSA match money.

While access to prevention money may become easier, using funds for residential placements will face new requirements and restrictions.  Again, the focus of the new act is to encourage family preservation and discourage out-of-home placements unless absolutely necessary.  As such, private providers will face new certification requirements, and judges will have to approve residential placements.  In addition, family-based follow-up services will be required for six months following a child’s discharge from a residential/congregate care program.  Ayers warned that if the IV-E funds were not allowed for these services, CSA funds could not be used either.

More will be known about the new federal requirements when guidance is issued, likely in October of this year.  Virginia Social Services is also convening a steering group to start looking at changes needed in Virginia.  This multi-agency, multi-stakeholder group will include representatives from VML and VACo.

Contact:  Janet Areson (jareson@vml.org)

Proffer party update

VML continues to be involved in the work on possible changes to the proffer statute. The Senate Local Government Committee has charged localities and the homebuilders to work out proposed changes.

Senator Peake’s aide recently hosted a private party on proffers that included representatives from VML, VACo, Goochland County and the Thomas Jefferson Planning District. The basic upshot of the meeting was that local governments and homebuilders were told to meet and develop sensical changes to the proffer statute. Andrew Clark of the Virginia Home Builders Association committed to working on a solution by mid-August for all parties and providing monthly updates on the status of his proposal.

Here is the update from Clark sent on June 7^th:

“My apologies for the delay in responding – been on the road for the last week.

We are continuing to have internal discussions with our legislative committee and members from around the state about the concerns that have been expressed by local governments.  We are considering several concepts but as of this moment, those draft concepts are not ready for distribution.  But the progress thus far is promising.  Will continue to provide everyone with updates on our deliberations.”

VML contact: Michelle Gowdy, mgowdy@vml.org

Updated summer meals program toolkit; Recording of May 24 conference call available

During the summer months, children from low-income families lose access to school breakfast and school lunch.

The Summer Meals Program helps fill this gap.  Unfortunately, only 15% of Virginia children who rely on free or reduced-price school lunches are also getting free meals during the summer.

The Local Government Toolkit and Checklist for the summer meals program has been updated and is posted here.

In case you missed the May 24 conference call with First Lady Pamela Northam and Richmond Mayor Levar Stoney on the summer meals program, you can listen to it here: https://attendee.gotowebinar.com/recording/5406241890130635521

VML contact: Janet Areson, jareson@vml.org

Intercity passenger rail issues explored

More people are choosing to take the train over driving or flying than at any time in the past 50 years and Virginia has emerged as one of Amtrak’s most successful state partners, according to a recent University of Virginia News Letter. The Lynchburg-Charlottesville-Washington-New York train is Virginia’s best-performing single daily train among the state-supported regionals. The best-performing station on the route is Charlottesville, with more boarding and alighting passengers annually (84,394 in 2017) than any other station on the entire route, including Washington, DC, and New York.

This News Letter is Part 1 of a two-part series that also examines evolving state and national transportation policies and the potential for expansion of passenger rail. The second part of the series is to be published this month. The author, Meredith Richards, a former vice mayor and member of the city council in Charlottesville, is the founder and chair of CvilleRail and the Piedmont Rail Coalition.

 

• eNews February 8, 2018 – ACTION ALERT   Call delegates before noon on three measures Please call your delegate this morning, before noon, to oppose three bills: HB1258 (Kilgore), HB1427 (Kilgore) and HB1204 (Hugo). These bills are on the House floor at the noon session today.   HB1258 strips local control over the installation and operation of wireless infrastructure. Talking points for […]
• eNews February 7, 2018   In this issue: Wireless bills reported from committee Online checkbook registry bill reported Landscape materials bills need your input! Planning process bill amended; reported FOIA update Affordable dwelling unit bill reported School construction bill moves upstairs Procurement update Stormwater/airports bill recommended for striking Proffer measures carried over to be studied   Wireless bills reported […]
• eNews February 6, 2018   In this issue Pretrial services bills to be heard tomorrow Delinquent tax collection measure moves forward Transportation bills are in the works Regional charter school bill to be heard in Finance   Pretrial services bills to be heard tomorrow A bill (HB997-Gilbert)to repeal the pretrial services act in the Code of Virginia is on […]
• eNews February 5, 2018   In this issue Heavy trucks FOIA public comment On-line checkbook registry Landscape materials Reduced planning review timeframe Grievance procedures Your voice is needed on several bills This is a busy week and we need your help on bills dealing with public comment under FOIA, heavy trucks, landscape materials, on-line checkbook registries, reduced planning review […]
• eNews February 5, 2018 – ACTION ALERT   Stormwater/airports bill will be heard Tuesday Action needed: Oppose HB1004 HB1004 (Byron) requires localities to waive stormwater fees for public airport taxiways and runways. The bill will be heard in the House Agriculture, Chesapeake and Natural Resources Subcommittee #3 at its Tuesday, Feb. 6, meeting at 4:00 p.m. If the subcommittee recommends the bill, […]
• eNews February 2, 2018   In this issue Act now: Wireless infrastructure will be on the House floor on Monday “By right” solar bills strip local authority On-line checkbook registry bill to be heard Feb. 6 FOIA bills: Some are moving, and some are gone Fireworks update Cooperative procurement bill advances Election legislation update Update on other bills affecting […]
• eNews February 1, 2018 – ACTION ALERT   House Finance Subcommittee endorses new Unfunded State Mandate Action needed: Oppose HB1204 House Finance Subcommittee #1 approved on Wednesday a Delegate Tim Hugo measure (HB 1204) that requires local assessing officials to provide for use value assessment of real estate dedicated to open-space. Under the Code of Virginia (§58.1-3230), any local government which has […]
• eNews Jan. 30, 2018 – Legislative Day Edition   VML Legislative Day eNews In this issue: Calls needed on landscape materials bill Update on wireless infrastructure bills “By right” solar bills strip local authority Stormwater bills pose problems Budget amendments House bill threatens to upend local land use valuations On-line checkbook registry bill to be heard Jan. 30 FOIA update School board authorization […]
• eNews January 30, 2018 – Action Alert   Calls needed today and tomorrow on landscape materials bill Action needed: Oppose HB1595 (Wilt) The House Counties, Cities and Towns subcommittee #2 will consider HB1595 at its Feb. 1st meeting, which starts at 4:00 pm.  This bill prevents localities from passing local ordinances to regulate landscaping materials.  It is limited to real property owners who […]
• eNews January, 29, 2018   In this issue: This eNews is a special issue focusing on budget amendments.   Budget amendment packages to be released Feb. 18 Since January 10, the subcommittees for House Appropriations and Senate Finance have been meeting regularly and conducting hearings. The senators and delegates have listened to presentations explaining former Gov. Terry McAuliffe’s budget […]