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WHEN LAWMAKERS return to Richmond in January, they’ll have lots of work to do.
By Kathryn Watson | Watchdog.org Virginia Bureau
ALEXANDRIA — With the holiday season upon us, the last thing on the average person’s mind is the 2013 legislative session of the Virginia General Assembly, which kicks off Jan. 9.
But days from now, legislators from around the state will gather in Richmond to debate, compromise and develop strategies for issues that touch every Virginia household.
With transportation funding short $500 million a year, state pensions with unfunded liabilities of $24 billion by conservative estimates, and state employee health care and education consuming ever-growing proportions of the budget, taxpayers have a lot at stake come 2013.
But money-specific issues aren’t the only notable items on the table. So far, legislators have suggested scores of bills that reconsider legislative and gubernatorial power, voting access and the very definition of free markets.
Here’s a compilation — by no means a comprehensive list — of some bills to watch after the holiday decorations come down and life returns to some version of normal in January.
TAXES
1. SB 692 Eliminates corporate income tax
Introduced by: Sen. Steven Martin, R-Chesterfield
What it does: Martin’s bill would effectively eliminate the state’s corporate income tax rate of 6 percent beginning in 2014.
Why it matters: Martin isn’t the first to propose such a bill. But his legislation would likely force state lawmakers to discuss how to fairly tax Virginia’s businesses. A November 2011 report by the Joint Legislative Audit and Review Commission, the watchdog arm of the General Assembly, indicated that Virginia doled out roughly $12 billion in tax incentives in 2008. That’s nearly as much as it reaped in revenue ($14.3 billion). You can bet that, even if Martin’s bill goes nowhere, tax incentives and structures will occupy much of the Legislature’s time.
Notes: Sen. Richard Black, R-Leesburg, proposes a less radical version of Martin’s bill. It would commission JLARC to study the potential effects of eliminating the corporate income tax. The tax raised only $860 million in revenue in fiscal 2012, calling its necessity into question.
2. HB 1409 Alters motor fuels tax rate to a percentage calculation
Introduced by: Delegate James Scott, D-Merrifield
What it does: HB 1409 would change the current rate of 17.5 cents per gallon of fuel to a set percentage per gallon, to be decided by a state commissioner.
Why it matters: Scott’s is just one of the handful of bills filed for 2013 that would alter the gas tax in a way that increases revenue. But there’s something new on the horizon this legislative session — Gov. Bob McDonnell may be desperate enough to relieve the commonwealth’s construction and maintenance backlog by pinning the tax to inflation. “I can tell you that every other major tax in Virginia — the sales tax, the corporate income tax, and the (personal) income tax — all fluctuate with economic activity, because they’re a percentage,” McDonnell said at a meeting with legislators and business leaders in November. “… We’re looking at whether or not … it should fluctuate with economic activity, like every other tax in Virginia.”
3. HB 1402: Adjusts elements of individual income tax for inflation
Introduced by: Delegate Mark Cole, R-Fredericksburg
What it does: Cole’s bill would adjust the brackets, return filing thresholds, standard deductions and personal exemption amounts of the individual income tax, according to inflation. The adjustment would be calculated every two years starting in 2015.
Why it matters: Currently, a Virginian only has to earn $17,000 or more a year to qualify for the highest income bracket of 5.75 percent, per archaic thresholds determined years ago. Cole’s bill has the potential to put less of a tax burden on low earners. But the full implications of Cole’s bill would require a far more extensive analysis.
LABOR UNIONS
4. HJ 536 Places right-to-work law in the Virginia Constitution
Introduced by: Delegate Richard Bell, R-Staunton
What it does: Bell’s bill enshrines Virginia’s right-to-work law — which prohibits employees from being forced into unions against their will — into the Virginia Constitution.
Why it matters: With recent cases such as Michigan’s passage of right-to-work laws, the issue is gaining traction and attention in statehouses. Right to work may already be the law of the land in Virginia, but Bell’s bill — if it passes the constitutional test — would make it practically impossible for future state legislators to revoke right to work. Laws can be changed overnight, but alterations to the state’s constitution take years.
Introduced by: Sen. Bryce Reeves, R-Spotsylvania
What it does: Reeves’ bill adds a provision to the Bill of Rights to ensure employees have the right to a secret ballot in voting over labor union-related issues. That includes ballot measures and votes to select or authorize representation. Reeves proposed it to block what are known as “card checks,” which streamline the way to unionization.
Why it matters: The bill, supported by groups such as the Virginia Chamber of Commerce, allows employees to keep their labor-related votes secret. Perhaps Reeves said it the most eloquently: “We want to protect everyone’s rights from encroachment by union bosses and thugs.” His comments came in Dec. 14 interview with Watchdog.org.
Notes: All constitutional amendments have to circle twice through the General Assembly’s legislative cycle, and go to the people for a vote. So, SJ 88 couldn’t really become law for a couple years. Delegate Barbara Comstock, R-Mclean, filed a similar bill — HB 1385.
PENSIONS
6. HB 1331: Adds retirement benefit option for local employees
Introduced by: Delegate Peter Farrell, R-Henrico
What it does: Farrell’s bill allows any locality to create and maintain a defined-contribution retirement plan — instead of say, a defined benefit plan — for employees hired on or after July 1, 2013.
Why it matters: Whereas the employees pay into defined, matched contribution plans, the employer — in this case, ultimately, the taxpayer — pays into defined benefit programs. And defined contribution plans, unlike the status-quo defined benefit plans, don’t have government-guaranteed rates of return and outcomes. So, defined contribution plans are less costly to taxpayers.
And while defined benefit plans generally sound great to employees, the government is having troubles paying its bills. The Virginia Retirement System, which includes roughly 600,000 members, is underfunded by $24 billion, by conservative estimates. And taxpayers are on the hook.
BALANCE OF POWER
7. HJ 537, HJ 564: Calls for constitutional amendment increasing the powers of the General Assembly (first reference)
Delegate Greg Habeeb, R-Salem; Delegate Christopher Head, R-Roanoke
What it does: These two bills, practically identical twins, would allow the General Assembly to suspend or nullify any administrative rule or regulation by a simple majority vote.
Why it matters: The bills would vastly increase the powers of the Legislature — and allow some of that power to be concentrated in the hands of a few members. When the General Assembly isn’t in session, the proposed constitutional amendment would permit a smaller committee to take the vote. It may not seem important at first, but the Roanoke delegates’ bills are a piece of the legislative-vs.-executive power struggle that promises to play out in 2013.
Notes: All constitutional amendments have to circle twice through the General Assembly’s legislative cycle, and go to the people for a vote. So, the Constitution couldn’t change for a couple of years, at least.
8. HJ 549 Calls for constitutional amendment allowing the governor to run for two consecutive terms
Introduced by: Delegate Harry Purkey, R-Virginia Beach
What it does: If Purkey’s bill passes the constitutional amendment test, Virginia will no longer be the only state in the Union in which governors cannot run for two consecutive terms.
Why it matters: The current law, with roots in the Reconstruction era, limits some of the power and prestige for governors. Proponents of the as-is law say it’s a needed restraint on gubernatorial power, while Purkey and other advocates of change say it hampers a governor’s ability to fully carry out his platform. Purkey’s bill would apply only to those who take office in 2017 or later.
CONGRESS
9. HJ 565: Requests a balanced budget amendment requirement to the U.S. Congress
Introduced by: Delegate James LeMunyon, R-Oak Hill
What it does: LeMunyon’s bill would formally ask Congress to convene for the purpose of drafting a constitutional amendment requiring a balanced federal budget.
Why it matters: Perhaps Delegate David Albo, R-Fairfax, one of the bill’s 16 patrons, said it best: “Because the country’s going broke,” Albo told Watchdog.org in a December interview. If Virginia formally asks Congress to draft the amendment, it will add its name to 19 other states that have already done the same. A total of 34 are needed to call for a drafting convention, and balanced budget advocates see states’ momentum to do so growing. LeMunyon said he expects to see 10 to 15 states introduce similar proposals in their 2013 legislative cycles.
Notes: This isn’t the first time such a proposal has reached the Virginia General Assembly. LeMunyon said he has introduced similar legislation each year since entering office in 2010.
ELECTIONS
10. HB 1361: Extends eligibility for voting absentee
Introduced by: Delegate James Scott, D-Merrifield
What it does: There are almost more bills to expand voting access than a person can count on one hand, but Scott’s bill sums it up — eliminate the state’s current requirement that those who vote early offer one of a dozen-and-a-half pre-approved excuses.
Why it matters: Voting access became one of the most discussed issues in the 2012 presidential election, as the proliferation of Virginia bills on the matter shows. Virginia has some of the strictest early voting laws in the country. Those who oppose legislation like Scott’s cite cost.
11. HB 1340, HB 1341: Requires the state to foot the bill for presidential primaries
Introduced by: Delegate Lee Ware, R-Powhatan
What it does: These two bills, essentially a package, call for the state to reimburse local registrars for presidential primaries.
Why it matters: There was perhaps unprecedented pressure on Richmond from local registrars over this year’s presidential election to pay up. Ware’s bill highlights an even larger struggle between the state and local governments, as localities say the state demands more of them while providing inadequate funding.
EDUCATION
12. HB 1389 Requires a set amount of higher education dollars to go toward classroom instruction
Introduced by: Delegate David Ramadan, R-Dulles
What it does: Ramadan’s bill requires governing bodies at every public place of higher education to funnel 65 percent of revenue from in-state tuition and 65 percent of state funding toward instructional expenses.
Why it matters: Virginia’s public universities are throwing increasingly more money towards non-instructional or administrative expenses, and at an alarming rate. And some experts say it’s driving up the cost of higher education. In the six years leading up to the 2008-09 academic year, all but one of Virginia’s 15 four-year public institutions upped their spending on administration — and by an average of 65 percent, according to a January 2012 report by the American Council of College Trustees and Alumni.
Contact Kathryn Watson at katie@watchdogvirginia.org
