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Va. House, Senate Panels Split on Rail, Roads Funds

Both Spending Plans Offer Food-Tax Cut, Bay Help

By Michael D. Shear and Chris L. Jenkins
Washington Post Staff Writers
Monday, February 7, 2005; Page A01

RICHMOND, Feb. 6 -- Lawmakers in Virginia's Republican-controlled Senate and House of Delegates unveiled competing spending plans Sunday that provide an election-year tax cut and money for the environment but diverge sharply on how much to invest in the state's transportation network.

Less than a year after Republicans in the legislature waged a civil war over taxes, lawmakers pledged to resolve their differences by Feb. 26, the end of the 2005 General Assembly session and the start of intense campaigns for a new governor and all 100 House seats.

"Some of [the governor's] programs went up like a lead balloon in subcommittee ," said Del. Vincent F. Callahan Jr. (R-Fairfax). (File Photo)

Getting Around Washington: Washington Post Staff Writers Steve Ginsberg and Lyndsey Layton were online to answer your transportation questions.
How Virginia's Budget Could Be Revised

Key committees in the Senate and House of Delegates approved budget changes yesterday.

In both chambers: The amendments propose reducing the grocery tax, cleaning up the Chesapeake and raising teachers' and state workers' salaries.

Senate version: Would provide about $100 million for transit and about $150 million to finance new roads; also adds money to pay off deficits on old projects. Adds a total of about $670 million to the current budget for transportation.

House version: Would pump more than $1 billion into road and transit projects during the current two-year budget. Includes $40 million for public-private road construction partnerships, $103 million for two new funds for mass transit, and more than $532 million for new roads. Spending commitment continues into the future.

Governor's version: Gov. Mark R. Warner (D) proposed a one-time boost of $824 million in transportation funding, a cut in the food tax and raises for teachers and state employees. House and Senate amendments followed many of his proposals.

What's next: The budgets approved by the committees will be debated and voted on by the House and Senate this week. Then they'll review each other's plans and work out a compromise.

On the Web: Washington Post stories about Virginia's tax and spending plans, audio, live discussions and other special features are available at www.washingtonpost.com/vagovt.

_____Virginia Government_____
Senate Panel Approves Indoor Smoking Ban (The Washington Post, Feb 3, 2005)
Va. Assembly Passes Mine Safety Bill (Associated Press, Feb 2, 2005)
Virginia Bill Would Alter Rules on Church Property (The Washington Post, Feb 2, 2005)
Overhaul Sought on Va. Telecom Taxes (The Washington Post, Feb 2, 2005)
Full Report

"I think we'll be fine. I'm optimistic," said House Speaker William J. Howell (R-Stafford).

Negotiations on the state's two-year, $60 billion budget broke down last year over differences on the need for a tax increase. The tug of war now will be over how to spend the $1.2 billion in unexpected tax collections generated by a booming economy in Northern Virginia and huge spikes in taxes from corporations and home refinancings.

Gov. Mark R. Warner (D) presented a spending plan in December that recommended a one-time boost of $824 million in transportation funding, a cut in the food tax and raises for teachers and state employees.

On Sunday, House and Senate committees approved budget amendments that followed many of Warner's recommendations, including the food tax cut and the raises, but they axed some of the governor's key initiatives. The committee proposals become the road map to a final budget deal.

In a statement, Warner commended lawmakers for spending most of the revenue on one-time costs that will not bust future years' budgets.

"In this time of extraordinary growth in some of our most volatile revenue sources, I am pleased to see the legislators adhere to the fiscally conservative approach we took in the introduced budget," Warner said.

The Senate and the House propose using the windfall to reduce the tax on groceries from 4 percent to 2.5 percent, spend more than $50 million to clean up the Chesapeake Bay, increase salaries for teachers and state workers, and eliminate budget-balancing gimmicks the legislature used during the economic downturn of the past several years.

But the plans also include plenty to argue about when the small group of senior lawmakers who deadlocked for more than two months last year begin negotiations again this month.

"Last year, we were in complete turmoil. The turmoil is gone, and that helps," said Sen. Charles J. Colgan (D-Prince William), one of the likely negotiators. But Colgan said he fears that lawmakers have not recovered "the Virginia way" of budgeting. "We still have to do what's best for Virginia and not what's best for our political parties."

Lawmakers and lobbyists said the biggest hurdle will be money for roads and rail.

The Senate's transportation plan is purposely modest, senior lawmakers said. The budget would provide about $100 million for transit and about $150 million for new roads and would pay off $250 million in deficits on completed road projects. Senators would add a total of about $670 million to the budget but commit to little extra money in future years.

Senate Finance Committee Chairman John H. Chichester (R-Stafford) said the legislature should wait a year to make a major investment in what he called a "bill stuffed deep in the back" of the state's budget drawer. He hinted that he would consider new taxes next year to increase transportation spending.

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