Governor Firm on Tax Reform

Governor Firm on Tax Reform

Virginia needed tax revenues to erase deficit and jumpstart the economy.

Gov. Mark Warner (D) had just finished telling about 100 citizens gathered for a community meeting about a 2004 tax reform package that erased Virginia's $6 billion budget deficit. He boasted of the bi-partisan votes that permitted both parties to do what was best for the Commonwealth.

"It was simply to pay the bills," he said.

As he walked away from the gathering, he became highly animated when asked about the Republicans' charge that he never needed to raise those taxes in the first place. Virginia ended up with a $1.2 billion surplus, GOP leaders say.

Warner stopped and turned around to debate. His aide whispered, "Governor, we need to keep moving."

But Warner stood firm. "We needed the reform. Absolutely," he said. "We'd have lost our AAA rating."

He said the tax reform package spurred economic growth, and persuaded the credit agencies to take Virginia off "credit watch." He went on to explain that the revenue also was needed for increases in education and Medicare spending. The General Assembly pumped $1.5 billion in new state funding for public education that session

Del. Richard Black (R-32) called the tax reform "a fraud" during an interview in March of this year.

"We were being told the sky was falling if we didn't raise taxes," he said.

During the community meeting, Warner told residents that the 2004 belt tightening triggered 20 percent cuts in every part of government except education and Medicaid. Some of those cuts made people angry, especially when they resulted in the shutdown of several Department of Motor Vehicle offices, he said.

The governor blamed the deficit on prior Republican administrations that spent too much money or cut too many taxes.

Regarding the future of education, Warner pledged additional funding for higher education and spoke of the National Governor's Association plan to catapult efforts to give college credits to high school students before they actually attend a college or university. The move would result in enormous tuition savings, he said.

He also supported expanding a pilot project aimed at students who are not destined for a college degree. "You work hard and we'll guarantee an industry certification," he said. Students will be certified as automotive technicians, nurses aides and other professionals.

"We raise your earnings $5,000 to $7,000, and you're on your way to a career."

Regarding the need for innovation, Warner said schools ought to require three to four years of math and science in high school. "We've got to raise the rigor," he said.

Warner also addressed transportation. The governor boasted of $850 million in new transportation funds, but conceded the region needs additional transportation help. "We still have a long way to go," he said.

The Virginia Department of Transportation, which had been a "broken agency," is now operating more efficiently, he said. Records for "on time" construction projects have risen from 20 percent to 80 percent. The "on budget" work has climbed from 55 to 60 percent to 82 percent.

"We finally have a dedicated source of funding for rail," he said.

Protesters picketed near the meeting, objecting to Warner's decision to double the tolls on Dulles Toll Road to fund Metrorail to Wiehle Avenue in Reston.

Warner said studies show that traffic congestion would be worse without mass transit.

"If we didn't have Metro, our third in the nation congestion would be much worse," Warner said. "You’ve got to have a multi-modal solution."

Virginia still needs a permanent source of funding for transportation, he said. The Commonwealth needs to balance land use with transportation needs. The bottom line is that transportation plans have to keep from killing "the golden goose," he said.

He said Northern Virginia has actually been a "net winner" for the past decade in terms of transportation dollars. Most of the money, however, has gone to the Woodrow Wilson Bridge and the Springfield mixing bowl. "We've done disproportionately very well in Northern Virginia," he said.

Martha Polkey of Catoctin Coalition and Cate Magennis Wyatt presented file folders containing information about the need to protect the scenic and historical Route 15 highway and to solve its traffic crisis.

Polkey asked if anyone could get beyond the Virginia Department of Transportation's "1950 solutions to 21st Century" problems.

Bill Replogo asked the governor how to keep the power lines off the W&OD Trail. Warner said state guidelines require the utility to use the least expensive option, but it might be time for the legislature to change that approach and support underground power lines. It's very expensive, but other counties have done it, he said.