Virginia General Assembly Update to February 7, 2011

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Virginia General Assembly Update  to  February 7, 2011

News and Notes from the Virginia General Assembly

 

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

 


Monday, February 7, 2011

Clarification HB 2467 (Greason)Autism Insurance Mandate – The January 31, 2011 “News and Notes” referenced a $6.1 million cost to the Commonwealth should HB 2467 become law.  The $6.1 million per year cost referenced is the estimated cost for PRIVATE INSURANCE PLANS in the Commonwealth.  HB 2467 now includes state employees and the measure appears headed for passage.  The Chamber OPPOSED HB 2467.

Crossover – The last day that bills can be considered in either Chamber before crossing over to the other is Tuesday, February 8, 2011.

 

Machinery and Tools Tax
HB 1636 (Purkey)
classifies as capital taxable solely by the state machinery and tools that have not been in service for more than three years, machinery and equipment used by farm wineries and idle machinery and tools.  This measure is expected to pass the House and move on to Senate Finance for consideration.

BPOL Bills Advance
HB 1437 (Cole) and HB 1587 (Iaquinto) have passed the House of Delegates.  HB 1437 allows localities the option to impose BPOL on gross receipts OR Virginia taxable income.  HB 1587 allows localities through ordinance to provide an exemption, refund, rebate or other form of relief from BPOL for businesses locating for the first time in a locality for a period of two years.  The Chamber SUPPORTS both bills.

ABC Privatization Plan Revised
HB 2456 (Brink) and SB 1417 (Obenshain) contain the Governors revised plan to privatize the ABC stores selling off the retail licenses but retaining the wholesale operation.  There is some doubt that the measures will move forward prior to “crossover.”  The Chamber elected not to take a position on ABC privatization.

Eminent Domain Bills
HJ 647 (Bell) and HJ 693 (Joannou) create new restrictions on eminent domain.  It is expected that one of these measures will report from committee.

E-Verify Bills
A number of bills requiring participation in a federal electronic work verification program have been introduced this session including: 
HB 1727 (Carrico), SB 1049 (Barker), and SB 1288 (McWaters).

SB 1379 (Stanley and Barker) lowers the investment criteria for grants and loans from the Governors Opportunity Fund.  Grants or loans with minimum investments of $5 million and 50 new jobs will now be eligible should the bill become law.

Tourism Bill Passes Subcommittee
HB 2285 (James) authorizes a local tourism project to access one percent of the sales tax revenue generated on the premises of the project for debt service.  The senate’s companion bill is SB 1193 (Norment).

Unemployment Insurance
SB 1401 (McEachin).  This bill expands eligibility for Virginia’s plan and will increase costs in the future in return for a one time investment of $125 million from the federal stimulus.  The Chamber is in a business coalition that OPPOSES the measure.

An additional UI bill is SB 1113 (Watkins) that allows individuals to receive UI and social security benefits at the same time.  The Chamber is in a business coalition that OPPOSES the measure.  This benefit will require additional trust fund borrowing.

Transportation Bills Move Forward
HB 2527 (Howell) and SB 1446 (Wampler/Colgan) are the major funding bills for the Governor’s Transportation package.  Each bill has cleared committee votes and appear to be headed for passage in floor votes.  The Chamber SUPPORTED the bills and has endorsed Governor McDonnell’s transportation plan.

Key provisions of Governor McDonnell’s transportation plan are as follows:

  • $1.8 billion in state-backed bonds to be issued over the next three years.  These bonds were authorized by the General Assembly in 2007, and were supposed to be issued at $300 million per year.  But the state lacked the cash necessary to meet debt service requirements.  The Governor wants to issue some $600 million a year for the next three years. 
  • A bond issuance of $1.1 billion to be backed by future federal allocations to Virginia for road construction.  The state match needed to qualify for the GARVEE bonds would come from credits earned by the state from public and private spending on toll roads. 
  • Creates the Virginia Transportation Infrastructure Fund and the Virginia Transportation Infrastructure Bank whose board of directors administers the Fund.  Up to 20 percent of the Fund may be used to make grants to localities for transportation projects as determined by the Bank, and the remainder is used to make loans to private or public entities for transportation projects as determined by the Bank.  The governor proposes initially capitalizing the bank with $150 million in FY11 from the general fund and $250 million in FY11 from the Commonwealth Transportation Fund (Item 452 governor’s budget amendments). 
  • Make annual deposits in the newly created infrastructure fund by altering the priorities for assigning any year-end general fund surplus.  Any surplus funds would continue to be set aside first for required deposits to the Revenue Stabilization Fund (Rainy Day Fund).  After that transaction, two-thirds of the remaining money would be assigned to the Virginia Transportation Infrastructure Fund.  Any surplus remaining after these priorities are satisfied would be directed to the Virginia Water Quality Improvement Fund and other commitments including certain public institutions of higher education. 
  • Increases the availability of the local Revenue Sharing funds, specifically eliminating the $1 million cap per project and the $50 million total limit on funds allocated by the Commonwealth Transportation Board (CTB).  In the near term the governor proposes a budget amendment (Item 452) that increases the FY12 appropriation for Revenue Sharing from $15 million to $50 million using Commonwealth Transportation Funds.  In a recent solicitation of interest in Revenue Sharing for FY 12 local governments indicated that they will request more than $44 million in the 50 percent matching funds under this program. 
  • Gives discretion to the Governor to submit in his proposed budget an appropriation of up to 2 percent of growth in general fund revenues to transportation projects when the projected revenues are at least 5 percent greater than the projected general fund revenues from the previous year. 

Redistricting Panel Meets with Governor
After the regular session of the General Assembly comes to a close in 2011, they will reconvene in special session to work on redistricting.

A bipartisan panel has been appointed by the Governor to advise legislators on how to redraw districts.  This work is conducted every 10 years and it is based on the federal census.

The work of the panel is expected to be submitted by April 1.


During the General Assembly session, please feel free to contact the Chamber’s governmental affairs team. Ira Agricola can be reached at 664-2570 or at iagricola@hrccva.com.You may contact Candace Reid at 664-2572 or at creid@hrccva.com to bring any business issue or concern to the attention of the Chamber

 

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