STATEWIDE

PROPOSED CONSTITUTIONAL

AMENDMENT 1:

PERSONAL PROPERTY TAX RELIEF FOR ELDERLY OR DISABLED PERSONS

Question: Shall the constitution of Virginia be amended to authorize lower tax rates on personal property belonging to persons 65 and older, or permanently and totally disabled, in defined cases?

Explanation: The Constitution of Virginia in Section 1, Article X now provides that property taxes must be applied uniformly. This requirement means that the same tax rate will be applied to all like personal property. For example, most automobiles are treated as one category of personal property under state law, and a county or city must tax those automobiles at the same tax rate. It cannot tax an automobile belonging to a senior citizen at a lower tax rate than an automobile belonging to someone younger.

At the November 6, 1990 election, the voters of Virginia are being asked whether they approve amending this provision of the constitution to create a new exception to this general requirement for uniform tax rates.

The proposed amendment will allow the General Assembly to enact a law that will authorize local governments to set a different tax rate for any one or more categories of tangible personal property in limited situations. Categories of tangible personal property include automobiles, boats, machinery and similar items. This amendment does not affect homes or other types of real property.

The amendment will allow a lower tax rate to be applied to tangible personal property if it is owned either by persons who are age 65 or older or by persons who are permanently and totally disabled. In addition, the amendment authorizes this tax relief only for elderly or disabled persons who have limited income and assets and who find it more difficult to pay the taxes.

The Constitution now contains a somewhat similar provision that allows relief from property taxes on homes belonging to and occupied by the elderly or disabled. Counties, cities and towns have been authorized by state statute to provide tax relief for elderly or disabled homeowners and to provide exemptions from property taxes or deferral of the tax payments. This existing state statute sets out limits on the amount of income and on the net worth of the elderly and disabled who may benefit from the tax relief provided by the localities.

PROPOSED CONSTITUTIONAL

AMENDMENT 2:

LITERARY FUND PROCEEDS; LAW ENFORCEMENT FUNDING

Question: Shall the provision in the constitution of Virginia pertaining to the Literary Fund be amended so that proceeds from property seized and forfeited to the Commonwealth for drug law violations can be used to promote law enforcement?

Explanation: The Literary Fund is a special state fund for education that was first established in 1810 and was given constitutional status in 1870. Article VIII, Section 8 of the present constitution of Virginia provides that the Literary Fund is a permanent school fund to be administered by the state Board of Education. The fund is a source for low interest loans for school construction and for contributions to the teachers' retirement fund.

Article VIII, Section 8 specifies that certain state revenue must be deposited in the Literary Fund. Fund revenue includes all of the proceeds from the forfeiture and sale of property seized in connection with violations of state criminal laws, all fines collected for state criminal law violations and interest earned on the fund.

According to a report (1989 House Document No. 7) of the Virginia State Crime Commission, the Literary Fund received approximately $67 million in the 1987-88 fiscal year ($27 million from all fines and forfeitures, $26 million from loan repayments, $10 million from unclaimed property and $4 million from interest earnings). The commission estimated that revenue from all types of forfeitures generated only $150,221 in 1987-88 and that drug law forfeitures were only a portion of that amount. Therefore, the proposed consitutional amendment would reduce the Literary Fund's total receipts by less than $150,221, which is less than 0.2 percent.

At the November 6, 1990 election, the voters of Virginia are being asked whether they approve amending this provision of the constitution so that the General Assembly will be able to exclude from the Literary Fund the proceeds from the sale of property seized and forfeited in connection with drug law violations.

If this proposed amendment is approved and the General Assembly does exclude these proceeds from the fund, the amendment requires that these proceeds must be spent for the purpose of promoting law enforcement.

PROPOSED CONSTITUTIONAL

AMENDMENT 3:

LOCAL DEBT FOR TRANSPORTATION PURPOSES

Question: Shall the Constitution of Virginia be amended to authorize a new category of local debt for transportation purposes, which would be secured by pledged local tax revenue, subject to limits on the amount of the debt, and exempt from county voter approval requirements and municipal debt limits?

Explanation: Article VII, Section 10 of the Constitution of Virginia sets out the types of debts localities can issue.

At the November 6, 1990 election, the voters of Virginia are being asked whether they approve amending this provision of the Constitution to provide for a new category of permissible local debt.

This new category is defined by several specific characteristics and requirements:

1) The money borrowed can be used only for transportation purposes.

2) The debt of bonds must be payable exclusively from local revenue that is pledged or set aside to be used to pay off the debt.

3) State law will provide what types of local revenue and receipts may be pledged to pay off the debt or bonds, but in no case shall real property taxes be pledged to pay off the debt or bonds.

4) Bonds that meet the requirements for this new category can be issued by the locality without the local voter approval that otherwise would be required for county bonds and without being subject to the overall limit on debt otherwise applicable to municipal debt.

5) For each locality, the dollar amount of this new category of debt that can be issued and outstanding at any one time is an amount equal to 1.15 times the average annual local revenue of the locality over the prior three years from all sources other than local real property taxes.

PROPOSED CONSTITUTIONAL

AMENDMENT 4:

STATE DEBT FOR TRANSPORTATION PURPOSES

Question: Shall the Constitution of Virginia be amended to authorize a new category of state debt for transportation purposes, which would be secured by pledged tax revenues, subject to limits on the amount of the debt, and not require voter approval?

Explanation: Article X, Section 9 of the Constitution of Virginia now limits the types and amounts of debt the state can issue.

At the November 6, 1990 election, the voters of Virginia are being asked whether they approve amending this provision to add a new category of permissible state debt.

This new category is defined by several specific characteristics and requirements:

1) The money borrowed can be used only for transportation purposes.

2) The debt will be secured by state revenue that are pledged or set aside to pay off the debt.

3) The only state revenue or taxes that can be pledged are: a tax on retail sales of not more than one-half cent per dollar; and any taxes or revenue related to motor vehicles, aircraft or watercraft or the fuels used to operate them. Existing taxes or revenue may be pledged.

4) Bonds that meet the requirements of this new category can be issued without voter approval.

5) The dollar amount of debt that can be issued is limited in two ways: (a) There is a ceiling on the amount of the debt that can be issued in any four-year period. The ceiling is 25 percent of an amount equal to 1.15 times the average annual revenue over the prior three years from the state income and retail sales and use taxes. This ceiling applies to the combined total of the transportation debt covered by this new category and other state debt issued for capital projects and subject to voter approval under Article X, Section 9(b). (b) There is a ceiling on the total amount of debt that can be issued and outstanding at any one time. This ceiling is an amount equal to 1.15 times the average annual revenue over the prior three years from the state income and retail sales and use taxes. This ceiling applies to the aggregate total of the transportation debt covered by this new category and other state debt issued for capital projects and subject to voter approval under Article X, Section 9(b).

6) The bonds issued and secured by pledged revenue will have a prior claim on that revenue. The pledged revenue must be appropriated to pay off the bonds.

The amendment also exempts all state debt issued under Section 9 from provisions contained in two other sections of the constitution. First, there is an exemption from the provision that the General Assembly cannot appropriate revenue to be spent over a period longer than 2 1/2 years (Article X, Section 7). Under this exemption, the General Assembly will be able to appropriate pledged revenue over a longer period, typically 20 years, to pay off transportation bonds. Second, there is an exemption from the provision that laws enacted by the General Assembly are always subject to future amendment or repeal (Article IV, Section 15). This exemption will permit legislation to be adopted that pledges future revenue to pay for transportation bonds and which prohibits the future amendment or repeal of that legislation.

(Explanations provided by the State Board of Elections)