RICHMOND Legislative budget committees offer an anxious state a first look today at their blueprints for covering Virginia’s $3.8 billion funding shortfall for the next 29 months, and the cuts, savings and financial maneuverings they entail.
The Senate and the House face a midnight deadline for releasing their plans for closing a $1.3 billion gap in the remaining 4 months of the present fiscal year and another $2.5 billion shortage in the two-year budget cycle that ends June 30, 2004.
Gov. Mark Warner has already offered his proposals to have agencies make operating cuts of 3 percent this year, 7 percent in fiscal 2003 and 8 percent the year after. Last week, with January revenue figures down an alarming 9.1 percent from the previous year, he announced an additional 2,100 job cuts most through attrition, 700 through layoffs.
Now, state employees, people who rely on state services for the ill, ailing and needy, non-state organizations such as private museums and parks that need state assistance and people who pay state fees and taxes wait to learn if the news from legislators is any worse.
“There’s no way you take $3.8 billion out of the state budget and not feel pain,” Senate Finance Committee Chairman John H. Chichester, a Republican, said last week.
The trick is in how the budget is balanced.
Virginia will make the first use of a rainy day fund approaching $1 billion that was established after a recession ravaged the state’s economy in the early 1990s and crippled the state’s finances. This year’s budget will use $467 million, or about half of the fund the most state law allows in any one year.
The governor and legislators also agreed to freeze the car tax phaseout through 2004 for a savings of about $120 million, just as some fees for such things as vehicle registration, recording deeds and septic tank inspections are going up.
Beyond that, things get less certain.
House Speaker S. Vance Wilkins, Amherst Republican, said Friday that the House Appropriations Committee had done an exceptional job locating pockets of fat in the budget allocations added long ago for reasons now not clear or obsolete.
“There were really hundreds of things stuck in the budget that had no accountability, no statewide application and no core function. They were just stuck in there because somebody was able to stick it in there,” said Mr. Wilkins.
“They’ve gone through there and rooted out a lot of those things that have no direct accountability and filled a lot of holes in the budget. I knew there were a lot, but even I’ve been amazed at how many they’ve found,” he said.
State employee raises are highly unlikely into 2004, but lawmakers want to cushion the blow by sweetening benefits such as health care coverage.
The state will make more use of borrowing: separate bills to authorize bond use for higher education, state park needs and capital improvement have already cleared key House and Senate votes. Tuition at state-supported colleges frozen for years by the state will be allowed to climb sharply.