- The Washington Times - Tuesday, January 15, 2002

RICHMOND Gov. Mark R. Warner began laying the groundwork last night during his first State of the Commonwealth speech for how he intends to grapple with budget deficits that could swell to $5 billion through 2005.
"I would like to tell you that our commonwealth's finances are sound, but everyone in this chamber knows they are not," Mr. Warner told a joint session of the General Assembly gathered in the House of Delegates chamber.
Mr. Warner, 47, called the state's budget "badly out of balance" and said the deficits did not come about overnight. The state is facing a $1.3 billion shortfall for the remainder of this budget year, which ends June 30, and a $2 billion shortfall in 2003-04.
"We have a fundamental gap between the commitments state government has made and the revenue available to pay for them," said Mr. Warner, a Democrat.
He blamed the state government for not heeding the warning signs of an economic downturn, saying the state spent as if revenue would continue to come in based on double-digit economic forecasts.
Any revisions and amendments Mr. Warner wants to make to the proposed budgets of former Gov. James S. Gilmore III are due by Jan. 22. He said he needed the help of Republicans and Democrats to put the state back on track.
Few of Mr. Warner's proposals to balance the budget were new, as he has announced specific cuts he would make in recent weeks.
He promised no new tax breaks or reductions, no new spending commitments that go beyond 2004 and conservative economic forecasting.
Mr. Warner, who has said he is open to laying off state employees to help plug the hole in the budget, said he wants to limit new hiring to only essential personnel.
The governor proposed cutting state agency spending by 8 percent in 2004, as The Washington Times first reported this week. Spending also would be reduced by 3 percent for the remainder of this year and 7 percent in 2003.
Some of the "one-time" budget fixes Mr. Gilmore had employed in his budget proposal delivered in December also would have to be used, Mr. Warner said. Among them: tapping $467 million of the nearly $1 billion "rainy day" fund and using $167 million from the Literary Fund to pay for school aid.
Mr. Warner also said he wants to have a six-year plan submitted along with every budget he and his successors submit. House Appropriations Committee Chairman Vincent F. Callahan Jr., Fairfax Republican, and Senate Finance Committee Chairman Sen. John H. Chichester, Fredericksburg Republican, are sponsoring legislation that would mandate the long-term forecast.
He said he wanted a "top-to-bottom review" of state government.
"There may be some things state government is doing that we can no longer afford to do," Mr. Warner said.
Among other items, Mr. Warner proposed:
Convening a Higher Education Summit to make at least 15 additional Virginia research programs reach the top five nationally.
Establishing a panel to appoint nonpartisan governing boards for state colleges and universities.
Extending health coverage to more children of the working poor.
Rewarding teachers who obtain national certification and encouraging vocational education in public schools through an executive order creating the Virginia Career Education Foundation.
Reinstating the Virginia Military Advisory Council to better coordinate the many military facilities in the state.
The Democrats' response to the governor's 45-minute speech was supportive and many, including Lawrence H. Framme III, the state party's chairman, said today's budget problems were exacerbated by Mr. Gilmore's handling of state budgets.
"The simple fact is that the previous governor failed to make government live within its means," Mr. Framme said.
Sen. Mary Margaret Whipple, Arlington Democrat, said the governor gave a "sobering message" to the state about the state's finances.
House Democratic Caucus Chairman Brian J. Moran, Alexandria Democrat, said that while the budget problems will be difficult to tackle, Mr. Warner laid part of the solution out in a way that should please everybody looking to restore fiscal conservatism to the budget.
"I don't think there is much that Republicans can complain about," Mr. Moran said.
Some Republicans lawmakers, like Delegate Leo C. Wardrup Jr. of Virginia Beach, did not think Mr. Warner delved deeply enough in the specifics of fixing the budget.
"I think it remains to be seen if this gentleman is ready for prime time," Mr. Wardrup said.
However, most Republicans and three legislators whose support he must have gave Mr. Warner high marks for stressing a theme of bipartisanship and fiscal conservatism.
"It had a very GOP-ish tone," Mr. Chichester said of the governor's fiscal policies outlined in the address. "He set the tone for how he would solve the budget problems."
There was also a "businesslike" quality to the speech, Mr. Chichester said reflecting the new governor's background as a businessman who made millions in the telecommunications industry.
House Speaker S. Vance Wilkins said the "devil is always in the details," but that Mr. Warner's vision for a more fiscally conservative and smaller government "ties in" with what the Republicans want to accomplish as they work on the budget.
And Mr. Callahan said Mr. Warner's delivery of the dreary budget news needed to be heard, even though it may have been painful to the ears of those listening.
"He told it like it was," Mr. Callahan said.

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