Virginia Gov. John N. Dalton, despite his reputation as a conservative, budget-cutting chief executive, called on the General Assembly today to spend the state's budget surplus to supplement inflation-racked programs and to boost state employes' paychecks substantially. i
In a statistic-strewn, emotionless speech marking the opening of the 1981 legislative session, the Republican governor dismissed pleas from some lawmakers to return at least some of the estimated $184 million surplus to taxpayers either through income tax cuts or for partial repeal of Virninia's 4 percent tax on groceries and nonprescription drugs.
Dalton, whose speech also marked the start of his last year in office, cited inflation and the demands of "proliferating" federally mandated programs such as Medicaid as the chief culprits preventing any tax cut. And he invoked last November's landslide Republican electoral gains as proof "our people . . . expect us to approach the decade of the '80s as an era of accountability" in government.
As expected, Dalton's address provoked derision from some members of the Democrat-dominated assembly, who said they would attempt to enact some tax relief despite the governor's opposition.
"It's a wonderful thing that John Dalton, the great fiscal conservative, the great friend of the taxpayer, is telling us to spend all of this money instead of having a tax cut," said Del. Warren G. Stambaugh, an Arlington Democrat who has perennially led a fight to repeal the food tax. Stambaugh branded Dalton's plan "spend, spend, spend" and added, "the delicious irony of this whole thing is going to work to the advantage of those of us who want to reduce taxes."
Dalton's speech was also attacked by Del. Archibald A. Campbell (D-Wythe), chairman of the influential House Finance Committee, who contended his own analysis of state revenues indicates the surplus could run twice as high as the governor has projected. "Certainly there's room enough there for some tax relief," Campbell said.
But the governor appeared to have solid backing from most of the assembly's leadership, which last year helped ram a statewide gasoline tax increase through a reluctant legislature as Dalton's behest and can be expected to assist him again this time.
Del. Richard Bagley (D-Hampton) and Sen. Edward E. Willey (D-Richmond), chairmen of the powerful House Appropriations and Senate Finance committees, respectively, both hailed Dalton's approach as "realistic" and "responsible." Del. Thomas W. Moss of Norfolk, majority leader of the House of Delegates -- whose members are under the pressure to pass a tax cut because they must run for reelection in the fall -- also indicated his likely support for the governor.
"You have to be a realist," Moss said. "Everybody would like a tax cut. But if we can avoid any increases and still take care of the needs . . . then I think we've done a fantastic job."
The lawmakers, faced with a massive pile of bills to be dealt with during a 38-day session that is one of the nation's shortest, began their task today by eliminating a number of measures. Willey's finance committee effectively killed one bill to repeal the state nonprescription drug tax, while another committee chaired by House Speaker A.L. Philpott effectively killed a proposal to establish an independent commission to ride herd over legislators' ethics.
But today's main event was the governor's 50-minute message, delivered in the flat, businesslike style that has become the hallmark of the Dalton administration. Many lawmakers were yawning in the crowded, over-heated House of Delegates chamber and some said it was the first time in memory that a governor's message was not interrupted once for applause.
"It was typical of Dalton -- all business and no creativity," said Mary A. Marshall (D-Arlington). "It had all the moving verve of a report to the board of directors meeting of a bank."
In last year's 60-day session, the assembly approved a two-year state budget totaling nearly $12 billion. This year's "mini-session" will attempt to carve up the $184 million surplus that administration officials say is largely the result of an inflation rate that has increased taxes faster than state spending. Of the major areas where Dalton proposed to spend the extra funds:
About $65 million is earmarked for the Medicaid program to cover a massive deficit that state officials failed to anticipate when they hammered out the budget last year. Dalton originally had threatened to cut nearly $30 million from the program but backed down after his analysts determined the cut would merely cause costs to be transferred to other state social welfare programs.
Dalton's present proposal cuts only $3 million from Medicaid but the governor warned that without major changes in the future, the program could cost the state as much as $5 billion annually by the year 2000. The governor also pledged to veto any effort to extend Medicaid benefits, including a controversial proposal to fund abortions for victims of rape and incest.
The governor proposed $48 million for eduction, much of which would go toward raising the state's basic aid to local schools.
Another $47 million would go toward an across-the-board 9 percent increase in state salaries. The assembly last year budgeted only half that amount, but Dalton said the boost was necessary to keep state workers from falling further behind their counterparts in private industry. The proposal also calls for an increase of $20,000 in the governor's salary, currently $60,000, beginning in 1982 and even higher jumps for the lieutenant governor and attorney general.
About $26 million is budgeted for the overcrowded state prison system, which faces an explosion of new inmated and the threat of federal court action. Included would be nearly $13 million to localities whose jails presently serve as "holding pens" for inmates who are supposed to be in state facilities, plus money to hire 200 new prison guards.
Dalton in a recent background briefing defended his spending proposals as conservative and necessary. His chief financial aide, Secretary of Finance and Administration Charles B. Walker, said, "We're not expanding any programs or starting any new programs. We're simply maintaining the current level of funding for the programs we've already got."
Walker took sharp issue with Finance Chairman Campbell's claim that the administration is hiding a larger surplus. "He isn't really arguing with the administration, he's arguing with the 24 top business leaders of the state who were virtually unanimous in agreeing that our figures were correct," said Walker.
Most Republican legislators, many of whom fought with the governor over last year's gasoline tax increase, expressed their support for this year's proposals. "This stuff about a tax decrease is just political propoganda by a few Democrats," said Del. Vincent F. Callahan, a Fairfax Republican.
But some were less certain. Said Del. Clinton Miller (R-Shenandoah): "We have to constrain ourselves from spending the money just because it's there. I don't think a salary increase is an emergency. I know state employes are hurting, but so are the taxpayers."