RICHMOND — A bipartisan bill aimed at luring companies to economically distressed parts of Virginia by offering tax breaks to their employees has advanced in the General Assembly, passing the House of Delegates on Tuesday after a similar measure cleared the Senate the day before.
The measure, dreamed up by Del. James W. “Will” Morefield (R-Tazewell) as a Hail Mary attempt to help rural and disadvantaged areas that seem to be forgotten, drew unusual debate in both chambers. Lawmakers grappled with an idea that appears extreme but has drawn passionate support outside the usual partisan lines.
Morefield prefaced his presentation of the bill in the House by praising a colleague who has helped him build support across the aisle — Del. Lashrecse D. Aird (D-Petersburg).
While Morefield is from an area that’s heavily white, Republican and rural, Aird is from a majority-black city that is a Democratic stronghold. But they have been allies on the bill, united by the poverty experienced by people in their home towns.
“If [she] is an example of the future of this body, we are in good hands,” Morefield said of Aird, drawing applause.
The measure would let suffering areas offer corporate and personal income-tax breaks for companies that agree to locate there, as long as they meet certain criteria. The bill contained a list of 39 counties and six cities and was modified Monday to add another county.
Several Democrats spoke in favor of the bill during debate Monday and praised Morefield for his effort to come up with a creative way to seek economic development in troubled areas. But he drew tough questions from some senior Republicans, including Del. S. Chris Jones (R-Suffolk), the chairman of the Appropriations Committee.
Jones said he felt the 10-year term of the tax breaks was too long. Ordinarily, he said, measures with a “sunset clause” would have a term of three to five years.
Morefield countered that he had interviewed multiple companies in preparing the bill and was told that a 10-year term would be more likely to attract potential employers.
Del. R. Steven Landes (R-Augusta) argued that the bill should be considered “special legislation” and handled differently because it applies to only a few localities. But House Speaker M. Kirkland Cox (R-Colonial Heights) ruled that it was not.
The House passed it Tuesday by a vote of 87 to 12.
The Senate passed its version the day before. Debate there took a different turn, with criticism coming from several Democrats in wealthy districts.
Sen. William M. Stanley Jr. (R-Franklin), who carried the Senate version, went through a long litany of ways that Southwestern Virginia and other rural areas are less fortunate than “the gold crescent” — the area from Northern Virginia to Richmond and over to Hampton Roads.
In the Southwest, he said, people have a lower life expectancy, less health insurance, less education and greater likelihood of opioid addiction. Stanley quoted Glenn DuBois, chancellor of Virginia’s Community Colleges, who said two years ago that “if it were its own state in educational attainment, the rural areas would be dead last, dead last in the nation.” The other parts of Virginia would rank second nationwide, he said.
Senators from wealthier areas peppered Stanley with questions and criticisms. Sen. Richard L. Saslaw (D-Fairfax) pointed out that someone who already lived and worked in one of the 39 counties and six cities specified in the bill could simply switch jobs to a new company and no longer have to pay state income tax.
Sen. Jennifer L. McClellan (D-Richmond) said that someone could live in a wealthier area and commute to a job in one of the distressed areas to avoid taxes. Sen. J. Chapman “Chap” Petersen (D-Fairfax City) suggested the bill might violate the state constitution by giving special treatment to one class of people.
Stanley answered the questions patiently before saying: “We don’t need a handout. We don’t need more government assistance. We’ve got that. We’re just asking for a hand and a chance.”
The bill passed the Senate 29 to 11.