Virginia legislators got an $11.6 million present yesterday -- in the form of a higher revenue forecast -- as they headed into a weekend in which House and Senate money committees each decide how to divvy up an $18.5 billion two-year budget.
Finance Secretary Stuart W. Connock, briefing the House Appropriations Committee, said that while general fund projections for fiscal 1987 have dipped $400,000 since a Jan. 9 estimate, the overall tax outlook for fiscal 1988 has improved by $11.6 million.
Connock expressed concern about lagging sales tax revenues, which declined for the third consecutive month in January. The January figures, which reflect December sales, were up 7.8 percent over the preceding year, but short of the 10.1 percent growth needed to fund the current level of state spending.
"The sales tax gives us a lot of concern," said Connock, noting that it accounts for about one-fourth of all general fund revenues. Other revenues, including corporate income taxes, are likely to run ahead of estimates, and that "together they will balance off in the closing months," he said.
Del. Arthur R. (Pete) Giesen Jr. (R-Augusta) said Connock was being too conservative. "I feel better about it the economy ," Giesen said.
"Virginia has been conservative for 300 years," answered Appropriations Committee Chairman Dorothy S. McDiarmid (D-Fairfax).
The House Appropriations Committee will meet in a marathon session tomorrow to decide how to cut up the spending, and its counterpart, the Senate Finance Committee, will adopt its version on Sunday.
After the two chambers pass their respective versions next week, legislators will spend much of the final three weeks of the current session wrangling over the differences in the two spending plans.
One unknown factor in the budget fight this year is a debate over a revised ethics bill that would nullify a strict interpretation of a Virginia Supreme Court ruling on the state's conflict-of-interest law. The ruling sharply narrowed when legislators may vote on issues affecting their personal interests.
House Speaker A.L. Philpott (D-Henry) has threatened to keep the House from voting on the budget by Wednesday's deadline if the ethics bill, pending in the Senate, is not decided. The measure has been approved by the House but faces stiff opposition in the Senate, where several members say they think the House went too far in weakening the ethics law.
The Senate takes its first formal look at the ethics bill today, but has not indicated it will take any quick action.