Thursday, January 15, 2015
Governor McAuliffe touts economic development
In his State of the Commonwealth Address, Governor Terry McAuliffe urged the Republican-controlled General Assembly to support his administration’s economic development efforts and to continue the bipartisan work on reforms to education, transportation and ethics.
“Folks, just one year ago, I stood at this very desk and shared my vision for a stronger, more independent Virginia economy,” McAuliffe said to a joint session in the House Chamber. “One year later, I am proud to say that optimism was well-founded.”
McAuliffe noted that Virginia has closed 267 economic development deals that resulted in $5.58 billion in capital investment in the first year of his administration.
“We traveled the globe selling Virginia agricultural products, everything from apples to wine, to soybeans to peanuts,” McAuliffe said. “I even ate my fair share of fried cicadas and chicken paws. But I will eat anything if it means more jobs and investment here at home.”
However, the governor warned that mandatory federal budget cuts or sequestration could return in October. He cited a George Mason University study that reported Virginia lost $9.8 billion in military contracts between 2011 and 2013 and that 154,000 jobs are in jeopardy.
Governor McAuliffe said Virginia’s days of relying on federal spending to buoy the state’s economy – in good times and bad – are essentially over. He added that to preserve Virginia’s position as a global economic leader, lawmakers must open new avenues for growth that are not dependent on federal spending.
“We must grow, strengthen and diversify,” he said.
Governor McAuliffe said his budget proposals do not contain cuts to K-12 education and no additional cuts to higher education, which is good news to localities. Another potentially favorable proposal includes the elimination of tax preferences to help close some of the $2.4 billion budget shortfall.
The governor reiterated his desire to give state employees a 2 percent raise, which was eliminated from last year’s budget. He said he wants to compromise with legislators on some pay increase.
“If you come to me with a plan to raise state employee pay, I will give it the consideration it deserves, provided that it does not require cuts to education, healthcare or other essential services,” he said.
The governor also spoke about stricter limits on gifts to elected state officials – a measure many in attendance agreed is necessary. He encouraged lawmakers to pass ethics reform that puts a $100 cap on gifts to public officials, and to establish an advisory committee to investigate and rule on possible violations.
Governor McAuliffe called for two reforms that faced harsh opposition in the past – Medicaid Expansion and gun control measures. Both are likely to be hotly debated during the General Assembly Session.
“If we are going to build a new Virginia economy, we must get those hard-working men and women the healthcare they deserve,” Governor McAuliffe said. “And the truth is, we have already paid for it. With one vote this session, we can get health care for 400,000 of our fellow Virginians, create up to 30,000 new jobs and save our current budget $105 million.”
VACo Contact: Dean Lynch, CAE
Proposed legislation pushes for change in PPTA
On January 13, Governor Terry McAuliffe announced legislation that would change the state’s process to deliver projects under the Public Private Transportation Act (PPTA) and simplify the highway formula for transportation funding distributions. The transportation package is a bipartisan effort between the governor and Delegate Chris Jones, Chair of the House Appropriations Committee and Delegate Tom Rust, Chair of the House Transportation Committee.
In terms of reforming the PPTA process (also known as P3), the governor’s office states the legislation would provide the following changes:
- Private partners must disclose risk that is transferred to the Commonwealth. The intent is to minimize risk for taxpayers by selecting projects that the private sector is willing to make the appropriate investment in expectation of getting a reasonable return.
- The transportation secretary will be accountable by signing a finding of public interest before a P3 deal is finalized, certifying that the risk transfer and all other findings are still valid. This would prevent situations like the U.S. 460 P3 deal where procurement changed over the course of the project, yet no one was held accountable. There will be no way to duck responsibility for transportation decisions. The bill will protect taxpayers from undue risk, while using the P3 process in the intended way to deliver projects that move Virginia’s economy.
- Representatives from the General Assembly will be on the P3 steering committee that determines whether or not a project should move ahead as a P3 project. They will assess if there is truly a risk and reward relationship between the public and private sectors.
The bill also completely replaces the former 40-30-30 highway funding formula with a new one. The old system provided funds directly to localities that were broken up into several small distributions. Under the legislation, 40 percent of the money will go to the rehabilitation of structurally deficient bridges and deteriorating pavement, 30 percent will be allocated to projects of statewide importance and 30 percent will go to a construction district grant program.
The legislation also focuses on using resources to fix aging bridges and paving, improving oversight for project expenditures and providing stability in funding to transit projects.
VACo Contact: Beau Blevins
Register for the 2015 County Government Day at the General Assembly on February 5
The Virginia Association of Counties invites county officials to VACo County Government Day at the General Assembly on February 5 at the Richmond Marriott.
VACo staff will report on legislation affecting local governments, then county officials are encouraged to go to the Capitol to participate in committee meetings and advocate state legislators. In the evening, county officials are strongly encouraged to invite their state legislators to dinner.
9 a.m. – VACo Board of Directors’ meeting
11 a.m. – Registration
Noon – Keynote Speaker | VACo staff legislative briefings (box lunch provided)
Afternoon – Visit Capitol and advocate legislators
Evening – Make plans to take your state legislators to dinner
Also please plan on joining VACo members at the Rural Caucus Reception and Dinner on February 4.
VACo Contact: Carol Cameron