eNews Jan. 14, 2020Tuesday, January 14, 2020 - 04:24pm
In this issue:
- Bills reported from the Senate Local Government Committee
- Bills introduced that could threaten local taxing authority
- House Transportation Committee set to consider extensive legislation
- Peer-to-Peer Vehicle Rental bills offered
- Senate Commerce and Labor Committee meets; refers bills
- CSA-special education day school bills introduced
- Senate Judiciary Committee reports gun-related bills
Bills reported from the Senate Local Government Committee
On January 13, the following bills were reported from the Senate Local Government Committee:
SB225 (Stuart) –Allows a locality to enact an ordinance and require the removal of vegetation that dangerously obstructs the line of sight for a driver within 5 feet of any public right-of-way. If the owner will not remove the vegetation, the locality may remove the obstruction and recover the costs. It is expected that there will be language dealing with liability added to the bill on the Senate Floor. This bill arose from the death of a teenager in Stafford County at a dangerous intersection that was obstructed by vegetation.
SB292 (Deeds) – Provides that a member of the board of zoning appeals may also volunteer as an officer of elections.
SB340 (Locke) –Gives the localities in Planning District 23 the ability to control overgrown vegetation on certain properties. The city of Hampton requested the bill.
SB465 (Reeves) – Gives voluntary fire-fighting services and/or nonprofit or volunteer emergency medical services agencies the ability to receive in-kind donations of contract management services for capital projects; assistance in preparing requests for information, bids or proposals and budgeting services from a locality. Currently localities have the authority to make gifts and donations to various charitable institutions.
SB588 (Hanger) – Brings tax parity to cities and counties. The administration supported the bill in the committee meeting. The bill was referred to the Senate Finance and Appropriations Committee.
SB647 (Boysko) – Allows a specific project that is coming into a new territorial jurisdiction by annexation, boundary line adjustment or otherwise to retain its zoning approvals, provisions, terms and conditions.
SB649 (Boysko) – Allows a county with the urban county executive form of government (Fairfax County) to enter into an agreement with a town located in the county to assess and/or collect taxes for real or personal property. The agreement may include collection and enforcement as well.
VML Contact: Michelle Gowdy, email@example.com
Bills introduced that could threaten local taxing authority
Or, “What the General Assembly gives, it can take back.”
Under the category of “You must be kidding” we bring these bills to your attention:
Mandatory personal property tax exemptions for disabled veterans: SJ58, SB446, and SB820 amend the Virginia Constitution and the Code of Virginia to exempt from local personal property taxes one motor vehicle owned by a veteran who has a 100 percent service-connected, permanent and total disability. Over 30 cities, towns and counties already provide partial or full exemptions for vehicles owned by the disabled, including veterans. SJ58 is the constitutional amendment passed in the 2019 Session. If the amendment passes again in the 2020 Session and is approved by the voters in November, it will be incorporated into the state constitution.
VML recommends that legislation to implement the amendment include means testing. Exemption from taxes on property owned by surviving spouses of members of the armed forces killed in action is not absolute. Only the portion of the assessed real property that is not in excess of the average assessed home in a given locality is exempt from real property taxes.
BPOL freeze: HB948 prohibits a locality from increasing the rate of any BPOL license beyond the rate the local government imposed as of January 1, 2020. In addition, the bill states that if a locality did not already have a BPOL program as of January 1, 2020, then it could not levy any business license taxes. VML urges members to oppose the measure.
Reducing tax Liability of new motor vehicles: HB1019 would reduce the state motor vehicle sales and use tax liability (“titling tax”) by declaring that the sale price for a new car would be reduced by the amount of any allowance given by the seller for a used motor vehicle taken in trade as a full or partial payment for the purchased motor vehicle. Although the proposal specifically targets the state tax, it could have ramifications at the local level because personal property taxes often use the sales price as the basis for assessing this local tax. VML does not support the bill.
Rejecting sales tax increase in the Historic Triangle: HB1270 would require that, unless approved in a referendum held and adopted within Williamsburg, James City County and York County, the additional one percent sales and use tax enacted by the 2018 legislative session will expire on July 1, 2026. Another bill, SB254, would eliminate the additional sales tax if the three localities do not each allocate 10 percent of the revenues received for the planning and construction of a shared sports facility by July 1, 2021.
VML Contact: Neal Menkes, firstname.lastname@example.org
House Transportation Committee set to consider extensive legislation
Introduced at the request of the Governor, HB1414 (Filler-Corn) touches upon every facet of transportation in Virginia. It codifies new public safety measures, creates new programs and authorities to increase public transit affordability and generates new transportation revenues. Here are some highlights:
Creates revenue sources
- Generates transportation revenue in large part by increasing the motor vehicle fuels tax by phasing in an increased rate each year over three years to 28.2 cents/gallon of gasoline and 27 cents/gallon of diesel and then indexing each tax to inflation.
- Establishes a highway use fee and mileage-based user fee for vehicles that use alternative fuels or are deemed to be fuel efficient.
- Increases the regional Transient Occupancy Tax in Northern Virginia from 2 percent to 3 percent.
Reduces the motor vehicle registration fee
HB1414 cuts the state’s motor vehicle registration fees while allowing localities to levy rates up to the amount the state levies currently. Since localities are not allowed to impose a motor vehicle license fee or tax at a rate greater than the state’s, this proposal effectively holds localities harmless by allowing them to impose a fee or tax on motor vehicles up to the rate imposed by the Commonwealth on January 1, 2020.
Establishes new entities
- Creates the Virginia Passenger Rail Authority as an independent authority to acquire rights of way, develop, manage, operate, maintain, and improve passenger rail facilities in the Commonwealth. This appears to be how the administration is proposing upgrading Long Bridge (over the Potomac River) as well as build on the Governor’s announcement last month to purchase railways currently owned by CSX. This has the potential to improve passenger and commuter rail options across the Commonwealth for decades to come.
- Creates a Transit Incentive Program for transit service in urbanized areas with populations in excess of 200,000 with the goal of reducing barriers to transit use for low-income persons.
- Creates the Commonwealth Transit Capital Fund to support capital expenditures establishing, improving, or expanding public transportation services for projects approved by the Commonwealth Transportation Board.
Introduces several safety measures
- Provides localities the authority to reduce speed limits to less than 25 mph.
- Bans the use of handheld communications devices (i.e. cellphones) while driving.
- Bans open containers of alcohol in vehicles while operating on roads and highways.
- Makes failure to wear a seatbelt in the front seat of a passenger vehicle a primary offense
Restructures transportation funding in the code of Virginia
This restructuring proposes consolidating the various funds created in the code for various transportation purposes and simplify them by organizing different funds under new sequential code sections. This type of reorganization is always difficult to assess as there are so many interwoven connections that are not readily apparent.
VML is working to understand how these changes will impact different transportation funds and programs and will keep you apprised as we learn more about how these changes may affect localities.
VML Contact: Mitchell Smiley, email@example.com
Peer-to-Peer Vehicle Rental bills offered
The General Assembly will consider two very different approaches to Peer-to-Peer Vehicle Rentals (P2P) this session. The app-based P2P (the motor vehicle equivalent of Airbnb) promises to be another economic disrupter affecting the business and bottom-line of traditional car rental companies like Enterprise and Hertz. Additionally, local governments, whose finances depend upon the motor vehicle daily rental tax, could end up getting short changed as well.
There are six bills to watch. Four of them protect local revenues and are supported by VML. These are HB891, HB892, SB749, and SB750. These measures maintain the current daily rental tax rate of 10 percent, of which 4 percent is dedicated to the localities where the rental companies conduct business. The state expects the 4 percent to raise $50 million in each year of the next biennium. Another 4 percent of the vehicle daily rental tax is dedicated for state transportation programs and the remaining 2 percent pays debt service on a telecommunications system operated by the Virginia Department of State Police.
The other two measures, HB1539 and SB735, would alter the tax rate to provide a competitive advantage to the P2P companies like Turo and Maven. These two bills shrink the tax rate imposed by the state for localities from 4 percent to 2 percent.
The Senate bills have been referred to either Senate Commerce and Labor Committee or Senate Finance and Appropriations Committee.
The House bills are awaiting referral.
VML urges members to support HB891, HB892, SB749, and SB750 and to oppose HB11539 and SB735.
VML Contact: Neal Menkes, firstname.lastname@example.org
Senate Commerce and Labor Committee meets; refers bills
The following bills were referred by the Commerce and Labor Committee to the Senate Finance and Appropriations Committee on Monday:
SB9 (Saslaw) – Adds colon, brain and testes cancer to the list of cancers presumed to be an occupational disease covered by Virginia Workers’ Compensation Act for firefighters. The other similar bills were rolled into this bill. This bill was reported out with a substitute (not yet posted on the website).
SB2234 (Chafin) – Allows school boards to elect to have their employees and retirees eligible to participate in the state employee health insurance plan instead of the state-administered local health insurance plan. The local school board would have to pay the difference.
SB561 (Vogel), SB924 (Cosgrove), and SB741 (McPike) – All of these bills relate to post-traumatic stress disorder (PTSD) for first responders. SB561 and SB924 were combined into SB561; they define firefighter and law enforcement officers to include volunteers, auxiliary or reserve police and members of the capitol police. These bills require a diagnosis from a board-certified psychiatrist or a psychologist who is experienced with these types of diagnoses and include a list of qualifying events that must occur in the line of duty on or after July 1, 2020. SB741 was left as a standalone bill. It defines law enforcement and firefighters in more specific terms – listing the Airport Authorities, Marine Police, dispatchers and others. This bill creates a presumption that PTSD is an occupational disease if there is a diagnosis from a qualified health care provider which includes a licensed physician, licensed clinical psychologist, licensed professional counselor or licensed clinical social worker. This bill also includes a list of critical events.
VML Contact: Michelle Gowdy, email@example.com
CSA-special education day school bills introduced
The increasing cost of special education private day school placements continues to be an issue for state and local governments. These placements are paid for through the Children’s Services Act (CSA). As such, bills have once again been introduced to allow more options for use of CSA funds in publicly funded settings. These bills include:
SB135 (Stuart) and HB762 (Cole, J.) – Allows the use of CSA pool dollars for children in special education programs in Planning District 16, who 1) transfer from an approved private school placement to a public school special education program in PD 16 that is able to offer comparable services, or 2) would have to go to a private school but for the availability of a public school special education program. Currently, CSA funds cannot be used for special education programs within a public school; they can only be used for wrap-around services outside of the school setting.
These bills have been introduced for several years running. SB135 has been referred to the Senate Education and Health Committee; HB762 is pending committee assignment.
SB128 (Sutterlein) – Requires the Virginia Department of Education (VDOE) to implement a four-year pilot program in two to eight local school divisions. Before doing so, the VDOE would:
- Partner with each school division to identify the resources, services and supports needed by children currently served in private day special education placements.
- Study potential transfers to public school settings.
- Complete a process for redirecting federal, state, and local funding, including CSA funding.
This bill has been referred to the Senate Rules Committee. A companion bill, HB49 (McNamara) is awaiting committee assignment in the House.
VML supports efforts to give local governments flexibility in meeting the needs of their CSA population.
VML Contact: Janet Areson, firstname.lastname@example.org
Senate Judiciary Committee reports gun-related bills
The Senate Judiciary Committee (formerly known as Courts of Justice) reported a number of gun-related bills on January 13. Bills reported included:
SB69 (Locke) – Limits the purchase of more than one gun a month with a number of exceptions – including law enforcement agencies and officers, private security companies, antique guns, private sales, people with valid concealed weapon permits, and people who have lost, traded in, or had a gun stolen from them.
SB35 (Surovell) – Authorizes a locality by ordinance to restrict the possession or carrying of firearms, ammunition, or weapon parts in a public space (including any building or part thereof, parks owned by the locality, public streets/roads/alleys, sidewalks or areas being used or adjacent to a permitted event or event that would otherwise require a permit).
SB240 (Barker) – Creates a new substantial risk order, whereby upon petition by an attorney for the Commonwealth or law-enforcement officer, a judge or magistrate may issue an ex parte emergency substantial risk order to prohibit a person who poses a substantial risk of injury to themselves or to others from purchasing, possessing, or transporting a firearm.
VML Contact: Janet Areson, email@example.com
State revenues at mid-year outpace projections
Fiscal Year 2020 is halfway over, and year-to-date collections are 8.3 percent above last year and are significantly higher than the annual forecast of 1.9 percent growth.
Payroll employment continues to lag the national job growth at a less-than-robust 1 percent in November. The November unemployment rate was unchanged at 2.6 percent which is 0.2 percentage point below a year ago. The tight labor supply is a matter of concern for the Northam Administration.
The Virginia Leading Index fell 0.4 percent in November following October’s 0.5 percent decline. Future employment and auto registrations declined while initial unemployment claims rose signifying the state economy may (or may not) be headed for a soft landing.
Notwithstanding the sluggish economic news, the money in the bank is what matters most in terms of labeling an economy as strong or in trouble. In his presentation before the Senate Finance and Appropriations Committee, Secretary of Finance Aubrey Layne stated that total revenues can decline by 3.1 percent for the remainder of FY20 and the state would still meet the projected 1.9 percent revenue growth included in the Caboose Bill (HB/SB29).
FY 2020 Actual Collections
FY 2020 Official Projections
|Individual Income Tax Withholding||5.8%||4.7%|
|Individual Income Tax Non-withholding||17.9%||(7.7%)|
|Corporate Income Tax||19.2%||2.2%|
VML Contact: Neal Menkes, firstname.lastname@example.org