Gov. Mark. R. Warner (D) warned local elected officials today to expect a sharp decline in support from state government, even as county supervisors from across Virginia vowed to launch a public relations war to blame the state's General Assembly for fewer county services and higher local taxes.
Warner told county supervisors at the annual meeting of the Virginia Association of Counties that he and state lawmakers will slash an additional $1 billion from Virginia's budget when the assembly convenes in January, forcing local governments to rethink what services they provide.
"To think that we are simply going to batten down the hatches as we go through the next billion [dollars] of budget cuts without change is wishful thinking," Warner told more than 500 supervisors. "We need to start the kind of debate we haven't had in years in Virginia. That's the debate about what we really expect from government."
Citing what he called the largest single revenue drop in the 40 years tracked by the state tax department, Warner said the local governments will have to rethink the way they provide mental health services, libraries, services for the elderly and other programs that traditionally have been supported by both state and local money.
"They really haven't gone through that process at the local level," he said in an interview. Noting that state government now employs 6,000 fewer people than it did when he took office in January, he said, "There have not been the layoffs [in local government]. There has not been the restructuring."
Local and state governments in the Washington region and across the nation confront similar issues, as revenue shrinks and the cost of services continues to rise. Maryland, which spends $21 billion annually, projects a budget shortfall of $1.7 billion over the next two years. The D.C. government recently closed a gap of $323 million in its budget of $5.8 billion.
Warner also promised to renew efforts to find a way to improve transportation, despite the rejection last week of sales tax increases in Northern Virginia and Hampton Roads that would have paid for road and transit projects. "Are we going to throw up our hands?" he asked. "Or are we going to go back to work and say we have to fund an adequate transportation system?"
Meanwhile, county supervisors here said they were prepared to wage a statewide, political-style campaign to convince residents that state delegates and senators are avoiding increases in state taxes by forcing more financial burdens on local governments.
"They are so proud of being a low-tax state. Then we slobs in the trenches have to raise taxes," said Fairfax County Supervisor Gerald E. Connolly (D-Providence), chairman of the group's finance committee. "We're tired of the accountability being put on our doorstep and the General Assembly getting away scot-free."
William B. Kyger Jr., the Republican chairman of the Rockingham County Board of Supervisors, said of the GOP-led General Assembly: "If we go toe-to-toe with them in their environment, we lose every time. They divide and conquer us, whether it's rural versus urban or Republicans versus Democrats. Let's take this battle to the public."
The dueling messages here indicate the intensity of the state's financial struggle. Virginia operates on a two-year budget cycle, spending about $25 billion a year.
During the 2002 legislative session, the governor and the General Assembly reduced spending plans by $3.8 billion. Then declining revenue created a new shortfall of almost $2 billion. Warner closed about half of it last month by cutting services and firing workers. In two months, Warner and lawmakers will go even further.
Their actions during the next session will set the stage for county and city budgets. Local governments have raised property taxes to compensate for falling revenue, and elected officials expect pressure from advocates for schools, police, libraries, social services and transportation to do so again.
In anticipation of elections next year for all 140 state lawmakers and most local officials, members of the county association's board of directors approved a sharply worded resolution aimed at the assembly. The entire membership of the association will vote on the resolution Tuesday, and the organization's leaders said they expected to hire a public relations firm soon.
"Local governments can no longer accommodate the state's unwillingness to fund state mandated programs and the reduction of state revenues to localities," the resolution said. "We call upon all citizens to hold the General Assembly accountable."
Legislators dismissed the resolution. "Are they saying we ought to raise taxes?" asked Del. Vincent F. Callahan Jr. (R-Fairfax), chairman of the House Appropriations Committee. "Why don't they come out and say it? Don't just blame us without coming up with a solution. See if they have the guts to do it."
Sen. Richard L. Saslaw (D-Fairfax) said: "It's not the first time they've tried to pass their problems onto us. To say they have no culpability is just frankly absurd."
Sen. William C. Wampler Jr. (R-Bristol) also rejected the criticism. "We don't have room to point fingers at each other as to how we got here or who's at fault," said Wampler, who chairs the Commerce and Labor Committee and serves on the Finance Committee.
Many of the county supervisors, who gather at the Homestead resort each year to plot strategy and share information, praised Warner's speech, the first by a sitting governor to the group in 12 years.
Arlington County Board member Barbara A. Favola (D) said she believes Warner's call for a new debate about services will lead to a discussion about the need to raise state taxes as well as local taxes.
"He's going to cut everything he can cut and then, when it's painful enough, we'll talk about what to add back in and who's going to pay for it," Favola predicted.
Wampler said a discussion of tax increases is unlikely.
Warner declined to talk about a tax increase, saying only that he was disappointed that a legislative study on revamping the tax code was postponed. "We're still going through the process of looking for savings, looking for cuts," he said.