Even with another $1.8 billion sliced from the state's budget shortfall, Gov. Mark Warner (D) still faces a deficit as he tries to garner support for taxpayer spending.
Warner addressed two long-term capital funding mechanisms, including the bond issues and the sales-tax referendum that will be on the November ballot.
"What we're experiencing is an operating shortfall. These are long-term investments," Warner told the more than 250 people attending the Oct. 3 public policy luncheon hosted by the Loudoun County Chamber of Commerce.
The first "long-term investment" Warner mentioned involves two bond referendums. One of the referendums authorizes the state to issue $900 million in general obligation bonds for educational facilities, such as state-supported colleges, universities and museums, while the second referendum provides $119 million for parks and recreational facilities.
"Unless we make this capital investment now, we're going to fall further behind. We won't be able to remain competitive," Warner said about the education referendum. "It has been almost a decade since we've made this kind of investment."
WARNER'S SECOND INVESTMENT adds a half cent to the 4.5-cent sales tax, designating the increase for transportation projects in Northern Virginia. The half-cent tax, which excludes food and drugs, is expected to raise $5 billion in 20 years for improving existing roadways, transportation networks and transit systems in the Northern Virginia region, with Loudoun County's share slated at $600 million.
"We've had such explosive growth ... our ability to compete is deteriorating," Warner said, adding that "the firms that drive our economy" will not be able to expand in the region if the transportation infrastructure is not in place. "Is it a perfect solution? No. The alternative of doing nothing is unpalatable. It means more gridlock. It means unfavorable air quality. ... It means no economic recovery."
Warner said he knows he is asking voters to do something that is hard, which is raise their taxes.
In response, Jennifer Hoffman said that the tax increase is "a real bargain. We have not increased our sales tax in a number of years," said Hoffman, president of Net in Business in Potomac Falls. "We can't continue to offer the services we want ... without making them pay for something."
State Sen. William C. Mims (R-33) agreed. "Nobody likes a tax increase," he said. "Our economic future and our quality of life depends on it."
REGARDING the budget shortfall, Warner asked the state's departments to propose cuts by the end the year. He said agencies may be eliminated and other areas of state government consolidated. "We need to start putting some markers down now," he said. "The state government will improve because of what we're doing."
State Sen. Russell H. Potts Jr. (R-27) said, "We're in this together. We're not a Democrat today. We're not a Republican today. We're a Virginian today."