Monday, February 25, 2008

Virginia’s Brewing Budget Battle

The General assembly only has a couple more weeks to finish its business and pass a budget.

A big area of dispute will be the Budget, with the Republican House passing a budget which is very different from the Democrat controlled Senate’s proposed budget.

Sadly, the Senate has essentially rubber stamped Governor Kaine’s proposed budget, which includes higher taxes, more spending, and more debt. The vote in the Senate was a party line vote 21-19 with Democrats supporting the budget and Republicans opposing it. I have been told this was the first time a budget has passed on a straight party line vote, so much for bi-partisanship that Dems are always talking about.

Here are the highlights, or should I say lowlights:

the Senate budget redirects $180M that had been earmarked for transportation to other government programs, adds $2.6B in new state debt which will result in more than $200M a year in new debt service payments.

It also takes $65M in lottery money, which is meant to fund education, to subsidize spending on other programs. The intent of the Lottery was to help fund education. Not to subsidize other programs.

It takes $423M from the state’s Rainy Day fund, to pay for new government programs. Shouldn’t we refrain from using the rainy day fund until there is an economic downturn!

The differences in the budgets approved by the Senate and the House of Delegates will have to be resolved in Conference before the end of the legislative session on March 8.

We shall see what happens.

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