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Money, Taxes, Spending -- And Redistricting?
By Stephen J. Rossie

Square2017 imageRICHMOND, VA – Money, taxes and spending have unexpectedly topped the news around Mr. Jefferson’s Capitol during the waning but oppressive days of summer. That isn’t unusual as state revenues start to pour in and official reports are issued. What’s different is that they are dominating the headlines — and that people are paying attention at a time when they normally prepare for school, take a final vacation or lay low while the heat index pops.

It started two weeks ago when Senator Bill Stanley (R-Franklin County), chairman of the Senate Local Government Committee and who formed a sub-committee this year to study school construction, floated a plan to fund building new schools. The funding would come in large part from the expected $300 million in new revenue from the now allowed Internet sales tax.

However, there are problems. Of the expected windfall, only about $89 million would be for unrestricted use. The rest is committed to education, localities and transportation, per the 2013 transportation tax law. But that law only triggers the use of that money after Congress repeals its ban on that tax. It is legal now only because of a recent U.S. Supreme Court ruling. Also part of that trigger was a $17 million reduction in the state’s wholesale gas tax because it was anticipated the Internet sales tax would more than make up for that road dedicated revenue.

Shortly after, Governor Ralph Northam proposed spending the massive surpluses generated by the Trump tax cuts on, essentially, subsidies to low income Virginians whose state income tax liability is zero after taking Virginia’s version of the Earned Income Tax Credit. Republicans immediately countered that the so-called refunds can’t be refunds if nothing was paid.

Northam’s plan would squeeze more taxes out of working families to fund a new expenditure program that redistributes hard earned money from one group to another. House Speaker Kirk Cox (R-Colonial Heights) said House Republicans want an equitable tax reform that lowers taxes on the middle class, who are "taxed enough already.”

Cox may be on to something. Northam’s plan hasn’t been well received. While Cox may have seriously jeopardized the viability of his thin majority because of his Obamacare Medicaid expansion deal with Northam, this unforced gubernatorial error may have given the GOP an opening to reengage its dispirited base and working class voters.

Northam, perhaps realizing this, quickly changed the subject to — speaking of House control — redistricting. He called lawmakers back to Richmond for a special session beginning August 30 to redraw House lines to comply with a federal court order issued in a case brought by Democrats. The court ruled that the current House lines unconstitutionally pack black voters into districts to the advantage of Republicans in neighboring districts.

The GOP is appealing, but Northam wants a new plan before that is considered. The court itself has given a deadline by which it said it would redraw the lines if the General Assembly does not act. But new legislative maps aren’t drawn by a finger snap. It’s a complex process and committee meetings and public input are required.

So much for coasting into the start of fall. While the air temperature finally will abate, the political temperature is poised to soar.

Stephen J. (Steve) Rossie is a Richmond-based public and government relations’ consultant. He has been a General Assembly lobbyist since 2006 and has written about Virginia government since 2007.


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