News and Notes from the Virginia General Assembly

Points of Contact: Ira Agricola, Senior Vice President &
Candace Reid, Manager, Governmental Affairs
Representing: Hampton Roads Chamber of Commerce &
Greater Williamsburg Chamber &Tourism Alliance

  Monday, March 8, 2010

No portion of this communication may be retransmitted or reproduced without the expressed permission of the
Hampton Roads Chamber of Commerce

One Week Remains in 60-day Legislative Session
March 13 is the final scheduled day of the 2010 Virginia General Assembly Session.  HB30 and SB30 offer each side of the legislature’s version of the biennial budget for FY11 and FY12.  The Senate budget contains fewer cuts; however, it also contains substantially higher fees in a number of areas that impact business.  Budget conferees include:  Colgan, Houck, Saslaw, J. Howell, Wampler and Stosch on the Senate side and Putney, K. Cox, Sherwood, Joannou, Jones and Landes in the House.

A key budget issue for manufacturers is the potential loss of a $60 million dollar domestic production tax deduction allowed by Federal law.  The Senate has included the deduction and the House has not.

Other key budget issues include the accelerated sales tax and the dealer discount fee.  A broad group of business interests including the Chamber has requested the following:

• Accelerated Sales Tax – adopt Senate budget language
• Dealer Discount – reduce the dealer discount by 75 % and restore all non-general fund dealer discounts such as 911 fees, cigarettes, tire recycling and communications.

The Educational Services Mandate for Autism Spectrum Disorder (SB464–Howell) Defeated in a House Subcommittee.
The Chamber opposes all insurance mandates that increase costs.  This mandate would have been one of the most expensive in the history of health insurance in Virginia.

SB239 (Watkins) Defeated in House Commerce and Labor Subcommittee
SB239 that would have permanently expanded eligibility for some and increased your business costs to qualify for federal stimulus dollars was defeated in House Commerce and Labor Subcommittee on March 2, 2010.  The Chamber OPPOSED SB239 and worked for several weeks to defeat the measure.  Special thanks to Delegates Purkey, Hugo, Rust, Cline, J. Miller, and Loupassi.

Court Fees Bill (Opposed by Chamber)
SB329 (Stuart) increases fees to the General District and Circuit Court substantially.  The bill is opposed by a broad group of business associations including the Chamber.  Revenue from the proposed fees would be used for Sheriffs and Commonwealth Attorneys.  This bill will be heard in the House Courts of Justice Committee chaired by Delegate Albo.

Governor’s Economic Development Bills Advancing (Supported by Chamber)
SB184 (Colgan) – HB199 (Cox) – expands the scope of the Major Employment and Investment Commission.  SB730 (Reynolds) permits grants for local planning for major projects.  SB472 (Watkins) reduces the threshold for access to the Major Business Facility Jobs Tax Credit.  SB554 (Puckett) allows the Governor to waive the matching fund requirement for localities applying for Governor’s Opportunity funds grants.  SB623 (Hanger) provides a $500 income tax credit for “green” jobs.  SB327 (Watkins) provides for a wine promotion fund deposits from the wine liter tax, SB257 ( Lucas) provides income tax credits for film production over $250,000 and $3.6 million for marketing funds for the Virginia Tourism Corporation remains in the House budget, however, it was NOT included in the Senate version of the budget.

Land Acquisition Program for Oceana not Included in Senate Budget and Only Included for One Year in House Budget
A letter dated March 2 was sent to State Senator Charles Colgan, Chairman of the Senate Finance Committee and Delegate Lacy Putney, Chairman of the House Finance Committee from the four congressmen representing Hampton Roads expressing concern over the BRAC related funding requirement for Oceana land acquisition.  The letter supports $7.5 million in funding from the Commonwealth annually.

Hotel Tax Bill Carried Over
SB452 (Whipple) would have required on-line out-of-state vendors such as Hotels.com, Expedia and Orbitz to pay the tax on hotel rooms to both the Commonwealth and the city.  The bill was carried over until next year after being considered by the House Finance Committee.  The Chamber took no position on the measure.

Stormwater Bills Approved
SB395 (Wagner) and HB1220 (Hugo) delay the effective date of state stormwater regulations.

Offshore Energy Production Bill Approved
HB787 (Villanueva) conforms Virginia law to federal law in the area of offshore energy production.

Offshore Lease Revenues to Transportation
HB806 that dedicates offshore lease royalties to the Transportation Trust Fund was approved by the Virginia Senate and is on the way to Governor McDonnell for signature.

Additional bills in this area include:  HB389 (Janis) that creates the Virginia Offshore Wind Development Authority, HB1022 (Hugo) that gives electric utilities triple credit in their renewable energy standards and HB1300 (Kilgore) and SB577 (McEachin) that create an Offshore Wind Project Development Commission.

Budget Amendment Submitted to Support Passenger Rail Development in Hampton Roads
An $80 million dollar budget amendment requesting funds from the Rail Enhancement Fund for capital improvements to the Route 460 – Norfolk Southern line has been submitted.  A second request for $6 million dollars in operating funds has also been made.

The Chamber SUPPORTS the efforts of V.D.R.P.T. Director Thelma Drake and her staff in developing passenger rail service to Norfolk and improving passenger rail service to Newport News.

Senator Ryan McDougle Elected Caucus Republican Leader Pro Tempore
Senator McDougle replaces former Senator Ken Stolle in this position.

Governor McDonnell Provides Guidance to Budget Negotiators; Special Sessions Possible
Governor Bob McDonnell has said, “If there is a clear link between the fee and the service it supports or finances, it’s reasonable to consider.”  He has signaled that a number of fees included in the Senate version of the budget are unrealistic.

The Governor has indicated that once the legislative session ends, that his administration will work on a transportation funding package.  A special session will be called if consensus is reached prior to going into session.

The Governor also is looking to evaluate results from his Government Reform and Restructuring Commission.  This effort may also require a special legislative session if significant savings can be realized.