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A service for our readers outside the Northern Shenandoah Valley... a sampling of The Daily's political coverage, plus unofficial, 'reporter's notebook' stuff. And occasional dry humor...

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Location: Strasburg, Virginia

Tuesday, September 06, 2005

Watchdog group to survey state’s biennial budget ; B2

By Garren Shipley
(Daily Staff Writer)

The commonwealth may be in fiscal high cotton, but a government watchdog group is planning to take a close look at the books for boll weevils.

Citizens Against Government Waste, a Washington, D.C.-based nonprofit that monitors federal spending for waste, is putting together a survey of Virginia’s biennial budget.

The group already puts out an annual “Pig Book” that catalogs projects and spending obtained by individual members of Congress that it says are of questionable priority.

It also puts out “Piglet Books” for a number of states.

“States always tend to look for more tax increases before they look for spending cuts,” said CAGW Spokesman Tom Finnigan.

The $1.6 billion tax hike in Virginia last year was just too big of a target to pass up.

“The tax increase really was the impetus,” he said. CAGW wants to take a hard look at where all the new money is going.

“There’s a number of things that we’re looking at,” he said. “Can the private sector do some of these things [that Virginia government is doing] more efficiently?”

Research for the book is done, and it will be published sometime in October. Previous states that have found their budgets in CAGW’s cross hairs include California, Ohio, Oregon, Arizona and Illinois.

Virginia’s budget does need some changes, Gov. Mark R. Warner told the state’s joint money committees this week. In particular, the actual document needs to be reorganized to make it more accessible to taxpayers.

The result will be the first major overhaul of the state’s budget in decades — and more accountability to taxpayers.

“Our goal is to put in place a performance management system that ties together dollars, services to people, policy objectives, and performance measures that show how we’re doing … into a single integrated system … for every citizen to see,” Warner said.

The long-term goal is to put state government into the same kind of performance-based budgeting that is prevalent in the private sector.

“Accountability is central to everything we do in government,” he said. “What better place is there to be accountable than in the documents that detail how we spend every taxpayer dollar?”

And there are a lot more dollars to spend.

Secretary of Finance John Bennett told the committees this week that the state ended fiscal 2005 with a surplus of $514 million in the general fund.

Most of the money will be eaten up by a required deposit in the state’s revenue stabilization, or “Rainy Day” fund, which will be close to reaching its constitutional cap of 10 percent of income and sales taxes in fiscal 2007.

The state’s balance sheet is in better shape than it has been for some time.

Fiscal 2005 was a record collection year for the general fund. State coffers took in some $13.7 billion, or 14 percent over last year’s collections.

Even so, Warner cautioned that the days of wine and roses won’t last forever. Virginia has seen boom followed by bust as recently as 2001.

“It would be exceptionally foolish for us to assume that unusually strong revenue growth from capital gains, corporate profits and the housing boom will continue indefinitely,” he said.

Growth may not continue at the same pace, but some are calling for future surpluses to be returned to the taxpayers.

Bills introduced in the 2005 legislative session by Del. William Janis, R-Glen Allen, and Sen. Stephen Martin, R-Chesterfield, would have put forward a constitutional am-endment that would require all surpluses $50 million above “Rainy Day Fund” deposits to be rebated to taxpayers.

Had the failed amendments been in effect for fiscal 2005, taxpayers would have seen a rebate of just more than $19 for every resident of the state, based on the most recent Census Bureau population figures for the commonwealth.

But some in the General Assembly have said automatic rebates are a bad idea.

“Clearly if the revenue is ongoing, we can choose to grant additional tax relief,” said Sen. John Chichester, R-Fredericksburg, chairman of the Senate Finance Committee, in a letter to Virginia newspapers.

But the state has needs that have been growing even faster than tax revenue.

The best decision is for the General Assembly to look at a surplus, and do their “fiduciary duty to weigh competing priorities and make the best choices,” he said.