January 24, 2012 News & Features » Cover Story


Cut and Run 

With no money, no taxes and conservatives in control, the General Assembly is about to change your life.

The General Assembly session, which ends March 10, will boil down to a simple question: How will Gov. Robert F. McDonnell and the Republicans fill the state's growing budget gaps without raising taxes?

Here's how: by shifting money around and forcing already cash-strapped localities to bear more of the burden. Schools budgets will be cut even further, and road maintenance will get down-shifted to the local level. A presidential election looms, and McDonnell is entering his last budget cycle, so we can expect lots of creative accounting in the statehouse.

But it's not just about shrinking budgets and crumbling roads. A whole host of gun bills might become law, and the government might be allowed to take your next-door neighbor's property. Here are five realities:

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1. Roads aren't getting fixed.

If your roads seem rougher and older than ever, there's a reason. Since 2005 the state has shorted its highway construction budget by $2.8 billion to cover routine maintenance.

One fix pitched by Gov. McDonnell is to raise transportation's share of the 5 percent sales tax that the state collects from half a percent to three-quarters of a percent and earmark it for road repairs.

The result? An extra $110 million in this budget for road maintenance. But there's a catch: Schools would get shorted in the process. That prospect has brought howls of protest from the education sector. Critics say that once again, McDonnell is trying to maintain his reputation as an anti-tax hawk, meeting the state's needs by shuffling the deck and avoiding tax increases.

To be sure, there are other schemes afoot to deal with the lack of road-maintenance funds, such as approving plans to funnel more of any year's surplus to transportation. Such ideas could generate about $100 million to $150 million for road repair. Problem is, no one can guarantee a surplus.

Other measures to deal with roads are even more controversial.

The simplest one is to increase the state gasoline tax. Virginians now pay 17.5 cents per gallon to the state — the 39th lowest rate in the country. Delegate Vivian Watts, D-Fairfax, proposes to raise the gas tax by 5 percent, or nearly a penny and a half per gallon, to help maintain roads. The extra tax would cost the average Virginia family about $200 more a year, Watts says. Northern Virginia, where road problems are especially acute, would pay an extra half a percent gas tax for regional maintenance.

Because Republicans now control both houses of the General Assembly and are dead set against any tax hikes, it seems that Watts' proposal is dead on arrival. That leaves another possibility to deal with road maintenance — shifting the burden to counties.

As it stands, Virginia has a tangle of funding formulas for road maintenance. Cities take care of their own streets, as do Henrico and Arlington counties. The remaining counties have the state do it for them. All get state funding through different formulas.

Although there haven't been any specific bills proposed, there's been talk in the McDonnell administration about shifting the burden of road maintenance to all counties. In county seats, the idea has flown like a lead balloon. Chesterfield County issued a statement opposing the idea as soon as it came up. "The county believes that road maintenance is a state responsibility. Period," says Don J. Kappel, the county's director of public affairs.

However McDonnell slices it, transportation is one of his biggest challenges. Although there may be no definitive action during this legislative session, McDonnell and Transportation Secretary Sean Connaughton have undertaken an aggressive campaign to build more roads and tunnels. By selling bonds and using public-private partnerships, McDonnell hopes to build a new superhighway to replace U.S. 460 running from Petersburg to Suffolk and retool the Mid-town Tunnel connecting Portsmouth and Norfolk. More work is expected on high-occupancy toll lanes near Washington.

In all, the governor expects to spend $4 billion over three years to build new roads. The question is whether he can do so without raising taxes, as he's promised, and whether he can get away with passing the tax buck to localities.

"At some point, the various stakeholders are going to have to come together and, No. 1, admit that we have problem," Chesterfield County Administrator James Stegmaier says. "And then talk about how you are going to solve the problem rather than just, 'Who are we going to pin the problem on?'"

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2. Your kid's school will become more crowded.

Education's underfunded. Schools need more money. The state's not paying enough for education.

It's a familiar refrain, one repeated every legislative session for as long as anyone can remember. But the buck stops this year. Local school districts are considering losing programs, laying off staff and increasing class sizes.

In his proposed budget — which will be considered, amended and voted on by legislators in the weeks to come — the governor trumpeted an additional $438 million for primary and secondary education. He later added $60 million for specific school programs.

But what McDonnell giveth with one hand, he taketh away with the other. Most of that additional money is going not to classrooms but to the Virginia Retirement System, the state's emaciated pension fund.

"We get more money from the state, but we have to pay two times as much, three times as much, back to the VRS," says Pat Russo, superintendent of the Henrico Public Schools. Sure, school administrators and teachers want the retirement system to be sustainable, he says, but it makes more sense to restore funding gradually. "The problem is, frankly ... the governor's asking for too much, too quickly."

How did we get here? Some blame McDonnell. Some point to entitled teachers. Truth is, the problem with the retirement system has been two decades in the making. The state has ponied up the full annual amount due to the system only four times since 1992, and not once since 2001. Moreover, it's borrowed from the retirement fund to meet other needs. Is it any surprise the retirement system faces a $19 billion shortfall?

Virginia Lottery money, which the state uses to meet its basic obligations to the schools, is coming up $86.5 million short in the next two years. Federal stimulus money has helped school systems, such as Richmond's, fill in the gaps during the last two years. But that money's gone. Richmond's school system also predicts that its health-care costs will rise by about 20 percent in fiscal year 2013.

The bottom line: There's no doubt that the pain will be felt in classrooms. At a Richmond School Board meeting last week, Superintendent Yvonne Brandon laid out possible options to make up a $23.8 million shortfall, which included: increased class sizes, laying off 100 people, requiring a three-day furlough and cutting pay by 2 percent.

Henrico, in its third year of budget cuts, will present its preliminary plan Feb. 9. Money-saving options could include increasing class size, laying off staff and reducing services, Russo says. The Chesterfield County school system was set to release its budget this week.

In 2010 Education Week ranked Virginia fourth in the nation for the quality of its schools. There's no way it can hold that position without paying for it, Russo says.

The alternatives? If you won't give us funding, at least give us flexibility, superintendents are telling the state. One bill would allow school systems to set their own annual calendar. Another would grant permission for schools to test alternative assessments beside the Standards of Learning. "We just don't think that a one-time multiple-choice test should be used to determine if a child is proficient or not, or a school is accredited or not," Russo says.

Another bill proposes to toughen the criteria for teachers. It would measure teachers by their students' progress, put all teachers on annual-contract status, essentially eliminating tenure, and require two-year probation for all new teachers and principals.

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3. The government might take away your property.

Let's say that you wind up living next door to a deathtrap. In this hypothetical situation, your one-time neighbors have abandoned their home to squatters or rats. In their absence, its roof has caved in. Its frame has begun tilting unsettlingly toward yours. And the waist-high grass has been invaded by things that frighten small children.

What can you do? Moreover, what can your city officials do?

Exaggerations aside, thousands of homeowners across the state face this dilemma. Abandoning a house isn't illegal. And with a worsening economy, the desperate are chucking their credit ratings and walking away from their mortgages in record numbers.

In Richmond, a city with an already aging housing stock, officials say the problem is even more acute. According to an August survey, there are more than 2,200 properties listed by the city's Department of Planning Review as vacant or abandoned. That's despite various urban-blight reduction programs instituted by the city Department of Economic and Community Development.

Here's the proposed fix: Legislators in both the Senate and House of Delegates — Sen. John Watkins, R-Powhatan, and Delegate Joe Morrissey, D-Richmond, respectively — have introduced similar bills advocates say will give cities an additional tool to combat blight. It's called a "receivership" program, in which local governments could petition a court to be appointed as the temporary possessor of a property. Following that, the government could hire a contractor to complete the repairs necessary to bring a property up to code.

Unlike similar programs in other states, Virginia's policy would apply only to properties where eminent domain has been granted under existing blight-abatement laws. Owners would have the option of paying off back property taxes and the cost of the repairs, or selling the house, with the city pocketing the difference. "If we can find a way to help people pay for the investment while retaining ownership of their home, it's a win-win," says Suzette Denslow, chief of staff to Mayor Dwight Jones.

If this is such a great idea, why hasn't it already been adopted?

Municipalities in more urban areas, including Richmond, are supportive of the measure, Denslow says, "but Virginia is a big property-rights state." Legislators in more rural areas haven't been as quick to embrace the idea.

"I think there's been a lot of misunderstanding on the part of folks who see this as a way for cities to add ways to seize a property," says Bob Newman, vice president of the Virginia Housing Coalition, which has been advocating for receivership legislation the last two years.

The bottom line: It's a tossup whether the legislation will, even with the city of Richmond's backing, be adopted or discarded. Meanwhile, neglected properties are driving down home values.

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4. Guns will be everywhere — soon.

One Republican lawmaker, Delegate Robert G. Marshall, R-Manassas, wants to make state colleges safer. How? By allowing professors to carry concealed weapons into their classrooms. His logic is simple: If, say, a professor is packing and a gunman pulls out a weapon or opens fire on campus, then the professor can pull out his piece and shoot back, in hopes of preventing a massacre like the one at Virginia Tech in 2007.

More guns equate to less violence, the pro-gun lawmakers say. So with Republicans in control, a whole slew of gun bills have bubbled up — guns on campuses, guns in airport terminals and courthouses; doing away with permits for concealed weapons and the law that restricts handgun purchases to one a month.

"I don't hold a lot of hope out in this area of legislation," says Sen. Donald McEachin, D-Henrico County, of the firing squad on Capitol Square. "Unless Republicans show some restraint, I suspect they are all going to pass."

Will the streets become more dangerous? No one really knows for sure. That's the difficulty with fighting the pro-gun lobby, says Dana Schrad, executive director of the Virginia Association of Police Chiefs. Weighing the effect of gun laws on criminal activity is hard, she says, although many have tried.

"It's difficult to measure the negatives," says Schrad, who was on the state crime commission in the mid-'90s when the commission attempted to assess the impact of the 1993 law restricting gun purchases to one a month. The number of Virginia guns traced to criminal activity outside of the state decreased after 1993, when the law passed, but then it spiked again in recent years. In a study released in September 2010 by Mayors Against Illegal Guns, Virginia ranked second for exporting interstate crime guns, behind only Georgia.

That's why Schrad is focusing her efforts on fighting other bills, such as gun-toting professors and the elimination of fees for criminal history checks administered by the Virginia State Police. Without the fees, there's no funding, which likely would cripple the program.

Meanwhile, be ready to live with more guns.

"It really represents a step backwards to think that we would continue to loosen these laws so that you have guns in bars, and guns just everywhere," says Mayor Dwight Jones, during a Jan. 10 news conference with Richmond Police Chief Bryan Norwood and Commonwealth's Attorney Michael Herring. It was a celebration of the city's declining violent crime, of course.

"We've developed a paradigm, we've developed a strategy that no matter what the variables are, we continue to use that strategy to solve crimes and work to bring the crime rate down," Jones says. "I think we'll do that no matter what happens at the General Assembly."


5. Newt can't save us.

When the session ends and the new laws are in place, a presidential election will be in full swing. And because of Virginia's archaic election laws, voters will be unable to cast their ballots for Newt Gingrich.

In late December, Virginia was thrust into the national political spotlight for having the most restrictive laws in the country regarding its presidential primary ballot. Candidates Gingrich and Rick Perry (who dropped out of the race last week) wouldn't be on the ballot in the state's Republican primary March 6 because they failed to get the 10,000 signatures required.

On top of this, the state came under fire for allowing the GOP to require signed loyalty oaths from any voter participating in the Republican primary, stating that he or she would vote for the party's chosen presidential candidate. Even Gingrich, a resident of McLean, had trouble with that one. He's sworn he'll never vote for Ron Paul, who made it onto the primary ballot.

The Mother of Presidents looked idiotic, if not downright repressive. University of Virginia analyst Larry Sabato has said that laws like these are designed to keep voters from participating in the democratic process. But will General Assembly do anything about it?

The answer is no, at least when it comes to changing primary registration rules. Justin Riemer, deputy secretary of the State Board of Elections, says that despite all the hoopla, "there have been no bills proposed yet to change the ballot requirements. I've not seen anything."

The law is ripe for change. Virginia has the stiffest requirements for getting on the ballot. Indiana comes next, but it requires only 4,500 signatures on petitions.

The loyalty oath is another matter and several bills are afoot to get rid of it. Critics say that it's an affront to free speech and smacks of dictatorship. It's also pointless, because it's impossible to enforce.

But altering it could bring on huge changes in how elections are run. Virginia has an open system for primary voting and is one of 20 states that don't require registration by party to vote in primaries. One version would leave it up to the voters, requiring them to write on the ballots whether they're Democrat or Republican. Those who write nothing will be listed as independents.

Whatever happens, the Republican loyalty oath is toast. The Republican State Central Committee dumped it Jan. 21. S

Correction: In earlier print and online versions of this story, Style incorrectly reported the state gas tax is 20 cents. It's actually 17.5 cents a gallon. We regret the error.



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