Assembly Week; No. 702

<v Chris Dickon>Here at the Virginia General Assembly in Richmond, it's the beginning of year five of <v Chris Dickon>trying to reconcile revenues and expenditures. <v Chris Dickon>We've got a new governor, but we've got the same old problem, the budget. <v Chris Dickon>On this edition of Assembly Week. [music plays] <v Chris Dickon>Welcome to Assembly Week from the Old City Hall building on Capital Square. <v Chris Dickon>I'm Chris Dickon. We've all been affected in one way or another by the budget adjustments <v Chris Dickon>of the last four years. Governor Douglas Wilder left office with general applause <v Chris Dickon>for the way he navigated through tough times leadership from the legislative side

<v Chris Dickon>during that time came from Senate Majority Leader and Finance Committee Chairman Hunter <v Chris Dickon>Andrews and from House Majority Leader and Finance Committee Chairman Dick Cranwell. <v Chris Dickon>Democratic governor Wilder's Secretary of finance was Paul Temmreck. <v Chris Dickon>When Republican George Allen was elected, he asked secretary Temmreck to <v Chris Dickon>stay on. Secretary Temmreck, I don't think people are as surprised <v Chris Dickon>that you were held over from a Democrat or Republican governor as they are curious about <v Chris Dickon>what it portends. Are you charged with staying the course of the last <v Chris Dickon>four years or with making small course corrections or perhaps taking some abrupt <v Chris Dickon>right terms? What does it mean? <v Paul Timmreck>I'm charged with helping Governor Allen and his team achieve their objectives. <v Paul Timmreck>Essentially going around has made it very, very clear that he wants to carry out a <v Paul Timmreck>fundamental reexamination of the way state government operates. <v Paul Timmreck>He wants to hold costs down. <v Paul Timmreck>He will not support increases in sales and income taxes. <v Paul Timmreck>So I'm there, too, to help them achieve his objectives. <v Chris Dickon>Does it mean, though, that his objectives are basically a continuation of the last

<v Chris Dickon>governor's objectives, or is that reading too much into. <v Paul Timmreck>Well, I don't. I wouldn't go that far. <v Paul Timmreck>What I would say is that I think Virginia has had a longstanding reputation for <v Paul Timmreck>fiscal prudence, fiscal conservative conservatism. <v Paul Timmreck>Governor Allen will maintain that that tradition and that in Virginia, <v Paul Timmreck>in practice, I think he is going to be looking for ways of freeing up <v Paul Timmreck>money so that he can move his priorities, particularly as it relates to the <v Paul Timmreck>abolition of parole and things of that nature. <v Paul Timmreck>So indeed, I expect some changes. <v Chris Dickon>Senator Andrews, when the Democrat, both the governor's office and <v Chris Dickon>the legislature together, they still didn't move with. <v Chris Dickon>Through this process, do you see more or less stress and strain between <v Chris Dickon>the legislative and the executive branch? <v Sen. Hunter Andrews>Well, I think we plan on cooperating with the executive branch. <v Sen. Hunter Andrews>We really don't know his programs yet. <v Sen. Hunter Andrews>Budget viewpoint we have we don't have the details on his program, but it's certainly our <v Sen. Hunter Andrews>intention to cooperate as far as the budget's concerned and other things.

<v Chris Dickon>That's always easily and nicely said at the beginning of this session. <v Chris Dickon>Is there going to be because we have this this different situation than we've had in <v Chris Dickon>the last 12 years? <v Sen. Hunter Andrews>I've served under three Republican governor and Mr. Cranwell has served with Republican <v Sen. Hunter Andrews>governors. And sometimes it's easier with Republican governors and <v Sen. Hunter Andrews>some of them without that party. <v Chris Dickon>You agree? <v Del. Richard Cranwell>I think that the legislative process, as I viewed it in the 20 <v Del. Richard Cranwell>years that I've been here, really doesn't break down along partisan lines. <v Del. Richard Cranwell>It's usually a struggle between city versus county or the <v Del. Richard Cranwell>highly populated areas versus the rural areas or business versus <v Del. Richard Cranwell>labor or the wealthy areas versus the poorer areas. <v Del. Richard Cranwell>I can't think of any issues that really break down along partisan votes. <v Del. Richard Cranwell>And, you know, I was here with with Leon Hulton Mills Godwin. <v Del. Richard Cranwell>John Dalton worked with all of them.

<v Del. Richard Cranwell>And I don't anticipate this being any different unless the incoming <v Del. Richard Cranwell>administration and the people in the administration react differently. <v Del. Richard Cranwell>And as long as that doesn't happen, I would expect it's going to be business pretty <v Del. Richard Cranwell>much as usual as it's been in terms of everybody sitting down and identifying what the <v Del. Richard Cranwell>priorities for the state are and folks-. <v Sen. Hunter Andrews>I'd like to follow up on what Dickie is saying. <v Sen. Hunter Andrews>I have said many times on the floor and elsewhere, 90 percent of what we do is not <v Sen. Hunter Andrews>Partisan unless you make it pass. <v Sen. Hunter Andrews>Now, if you want to make it Partisan and there are certain things will happen, and I <v Sen. Hunter Andrews>trust that neither one of us want to make something Partisan. <v Sen. Hunter Andrews>But if the other side makes something Partisan, we a perfectly capable of handling <v Sen. Hunter Andrews>that situation. We've been around a while. <v Paul Timmreck>The responses of these two gentlemen explains why in a number of occasions I've said <v Paul Timmreck>that we're not for the fact that I'm in Virginia. <v Paul Timmreck>I wouldn't be in this business. <v Paul Timmreck>Virginia's legislature and its governors have shown a way of making government work <v Paul Timmreck>for the benefit of the people.

<v Paul Timmreck>We don't have problems getting the budget balanced on time. <v Paul Timmreck>We don't have the kind of gridlock that you have in other states. <v Paul Timmreck>And, you know, irrespective of what party is in office, things do do get done and <v Paul Timmreck>progress gets made. So I'm very much looking forward to continuing to work with Senator <v Paul Timmreck>Andrews, and [unclear] <v Chris Dickon>What is the financial condition of the state right now relative to the last <v Chris Dickon>four years? Everybody thinks that things are getting a little bit better. <v Chris Dickon>A recession is easing somewhat. Where are we what do you think? <v Paul Timmreck>I think you have to differentiate between financial condition of the state in this and <v Paul Timmreck>the state's image. I think we've gotten very, very high marks in terms of what the <v Paul Timmreck>governor, the General Assembly have done to manage the budget and to deal with the policy <v Paul Timmreck>issues. But I think when you talk about the economy, for me, the single best example <v Paul Timmreck>of where Virginia's economy is relates to something that the Virginia Employment <v Paul Timmreck>Commission told us just a week or so ago. <v Paul Timmreck>And that is not until December of 93 that our economy, our state <v Paul Timmreck>of economy get to a point where it had once again, all the jobs that have <v Paul Timmreck>had in March of 1990 when the recession began.

<v Paul Timmreck>In other words, March of 1990, the county went off the cliff. <v Paul Timmreck>We lost 90000 jobs. It's taken that long to get those jobs back. <v Paul Timmreck>So in terms of job growth, we've been treading water for three years. <v Chris Dickon>This jobs of the same quality in terms of salary. <v Chris Dickon>I imagine there are different industries and occupations. <v Chris Dickon>And they were-. <v Paul Timmreck>They are they are somewhat different. But also, don't forget that some businesses are <v Paul Timmreck>looking for new lines of work and they're able to take what they used to be involved <v Paul Timmreck>in with defense, for example, and redirect that into civilian types of endeavors <v Paul Timmreck>and civilian enterprises. <v Del. Richard Cranwell>My guess would be the vast bulk of those jobs are are all within <v Del. Richard Cranwell>the same sector, I think. Paul, what was 52000 of the jobs were lost in the construction <v Del. Richard Cranwell>sector? <v Paul Timmreck>That's about right. <v Del. Richard Cranwell>So I suspect that you're seeing a substantial increase in the employment in the <v Del. Richard Cranwell>construction sector. So my guess would be that that you're picking up a lot of the same <v Del. Richard Cranwell>jobs that were lost because people ratchet back in the construction industry. <v Sen. Hunter Andrews>Chris, I think we've got to remember, we believe the economy is starting

<v Sen. Hunter Andrews>to turn around, but the 90s are not going to be the go go like the 80s. <v Sen. Hunter Andrews>And our gains are percentage wise off our lower base. <v Sen. Hunter Andrews>So we've got some real problems in the 90s to meet the needs. <v Sen. Hunter Andrews>I think we have to do defense cutbacks. <v Sen. Hunter Andrews>All of that. <v Paul Timmreck>Half speed growth Chris. In the 80s are average. <v Paul Timmreck>Annual increase in jobs was over four percent. <v Paul Timmreck>Now, you know, the official forecast is two percent each year. <v Paul Timmreck>So it's half speed growth and that means half speed revenue growth from the budget. <v Del. Richard Cranwell>Well we were averaging one anywhere from 9 to 11 percent. <v Paul Timmreck>We exceeded the nation. <v Del. Richard Cranwell>Sure. And they're going to be- <v Chris Dickon>What's it what's the gap that the assembly will be dealing with this session between <v Chris Dickon>revenues and expenditures? <v Chris Dickon>I mean, we always say-. <v Sen. Hunter Andrews>Well, I think when we examine Governor Allan's amendments, we can better answer <v Sen. Hunter Andrews>that question. We simply have not had time to examine those amendments. <v Sen. Hunter Andrews>And that casts a lot of light on what we have to do. <v Sen. Hunter Andrews>But but the budget is introduced had no gap it was perfectly in balance. <v Sen. Hunter Andrews>I mean, that was all eliminated because we had 206 million dollars worth of agency budget

<v Sen. Hunter Andrews>cuts. <v Chris Dickon>OK. Let's get to some specifics. <v Chris Dickon>Delegate Cranwell, the assembly has created a commission on equity and public education, <v Chris Dickon>which is the subject we could practically roll reroll a tape of discussions <v Chris Dickon>that we've had over the last four or five years about equity and education with you. <v Chris Dickon>It's one of your subjects. The disparity issue and all that kind of stuff. <v Chris Dickon>There is a move afoot to create lower class sizes for <v Chris Dickon>children to make better uses of educational technology to deal <v Chris Dickon>with this disparity issue between rural and urban in various urban school districts <v Chris Dickon>and how much it is. <v Del. Richard Cranwell>Well, it's really it's really between urban and rural and suburbia. <v Del. Richard Cranwell>The urban cores and the role for rural areas have a great <v Del. Richard Cranwell>deal in common. When you get to talking about the disproportionate spending. <v Del. Richard Cranwell>But Hunter is all in the study with me. <v Del. Richard Cranwell>And we've come out with a with four point recommendations that I think <v Del. Richard Cranwell>are going to go a long way toward not only dealing with the problem that you're <v Del. Richard Cranwell>mentioning, but I think we're all going to have an impact on the quality of education.

<v Del. Richard Cranwell>And I think down the road ten or twelve years out is going to have some benefit <v Del. Richard Cranwell>to us in terms of socially impact on on crime rate. <v Sen. Hunter Andrews>I agree with Dickie. I think when we're in agreement, we're waiting to implement the plan <v Sen. Hunter Andrews>with modern techniques of computers. <v Sen. Hunter Andrews>We can identify the actual schools where you have high percentages <v Sen. Hunter Andrews>of poverty. And we believe that poverty is best measured by <v Sen. Hunter Andrews>the free lunch program. <v Sen. Hunter Andrews>And we know that that is the most audited of the programs by the federal government. <v Sen. Hunter Andrews>And if we can zero in in these schools and help them reduce the teacher people ratio <v Sen. Hunter Andrews>and we agree, what we gonna try to do that also the at-risk four year olds. <v Sen. Hunter Andrews>But as Dickie pointed out, it is so important we have to stay the course. <v Sen. Hunter Andrews>This is a fundamental, basic change. It would help young people 10 years down the road. <v Sen. Hunter Andrews>But we've got to be willing to stay the course. <v Sen. Hunter Andrews>But we are such an impatient people. <v Sen. Hunter Andrews>We expect results overnight.

<v Chris Dickon>I've read a figure cost figure for beginning to do this over one hundred billion dollars <v Chris Dickon>in these tight times. Is that money there or is it? <v Chris Dickon>Is it blood out of a turnip? <v Del. Richard Cranwell>There you go. I think you know what Hunter said earlier on. <v Del. Richard Cranwell>The budget, as always, goes through a process. <v Del. Richard Cranwell>Paul will tell you. <v Del. Richard Cranwell>And it's going to be substantially different than what it is has introduced, but <v Del. Richard Cranwell>it's going to be substantially similar, if you can understand what I was saying. <v Del. Richard Cranwell>And I hope that in the process of working the budget through that, we can come up with <v Del. Richard Cranwell>the money to start the process, because I think what. <v Del. Richard Cranwell>Again, I think I agree on this. <v Del. Richard Cranwell>And I think the single most significant thing you can do in terms of improving <v Del. Richard Cranwell>the quality of education is to lower the pupil teacher ratio and earn a grade. <v Del. Richard Cranwell>And what this is designed to do is it reduces pupil teacher ratio in all schools. <v Del. Richard Cranwell>But in the at risk schools, you get down to two immediately to one to 18 <v Del. Richard Cranwell>people, teacher ratio. And we're shooting for the year 2000 to have it down to 116.

<v Del. Richard Cranwell>That my assessment is, if we can do that, he's going to have a tremendous impact <v Del. Richard Cranwell>on those students ability to compete in the education system. <v Del. Richard Cranwell>But I also think the at risk program for all four year olds <v Del. Richard Cranwell>is going to have a significant impact on what I call anti-social conduct, <v Del. Richard Cranwell>which is the envelope of the at risk problem. <v Sen. Hunter Andrews>What if you say this. At 17 hundred elementary school in Virgina. <v Sen. Hunter Andrews>We know five hundred of these have the high percentage of poverty and they're <v Sen. Hunter Andrews>all over some in Fairfax County. <v Sen. Hunter Andrews>So we really getting right to the meat andthe coconut of the rural areas and the core <v Sen. Hunter Andrews>cities and helping kids and Dicki and I are in agreement. <v Sen. Hunter Andrews>And I hope we can carry forward and get to support and implement it. <v Sen. Hunter Andrews>And we certainly hope governer Allen and comes on board. <v Chris Dickon>Where is Governor in all of this? <v Paul Timmreck>I haven't really been part of the discussions between Senator Andrews and Delegate <v Paul Timmreck>Cranwell about this. But, you know, a program like elementary or secondary education, <v Paul Timmreck>which is 35 percent of the budget. There's no way you can say that's not a priority of

<v Paul Timmreck>any governor in Virginia. So I'm sure he'll be very much interested in what they have to <v Paul Timmreck>say. <v Chris Dickon>Okay. Higher education. David Cranwell, you recently said that <v Chris Dickon>you didn't think education could take any more cuts in order for us to stay competitive. <v Chris Dickon>It seems that we've gotten to a point with higher education that we're going to create <v Chris Dickon>some formulas, criteria for performance and efficiency in some <v Chris Dickon>university. We'll get more money than the others, where are we with all of this? <v Chris Dickon>Is there more? <v Del. Richard Cranwell>Well, I listen to the president. <v Del. Richard Cranwell>The new president, V.P. this morning at a breakfast. <v Del. Richard Cranwell>And the one thing he went through is the things that are doing to VPI <v Del. Richard Cranwell>to streamline the operation if they've already cut a half million dollars out of <v Del. Richard Cranwell>administrative salaries. <v Del. Richard Cranwell>And they're fixing to push that all the way down through into the construction <v Del. Richard Cranwell>level. And I commend them all that effort. <v Del. Richard Cranwell>Paul Torgerson, who is President of VPI, is going back to Blacksburg Mackle. <v Del. Richard Cranwell>He teaching a course and he'll be teaching to more.

<v Del. Richard Cranwell>I commend all of those efforts. But this is a thing that I told you as I was leaving. <v Del. Richard Cranwell>I agree that we have to get the bang for the buck in higher education. <v Del. Richard Cranwell>But now is not the time. <v Del. Richard Cranwell>And America is not a place for us to start understanding the <v Del. Richard Cranwell>cost of higher education and not understanding the value of it. <v Del. Richard Cranwell>We have all the best education systems in the world at the college level, <v Del. Richard Cranwell>and it is it has allowed us to maintain the ability to compete worldwide <v Del. Richard Cranwell>if we start ratcheting that back too much. <v Del. Richard Cranwell>All we're doing is changing the face of America and its competitive position in the <v Del. Richard Cranwell>world. <v Del. Richard Cranwell>And I quite frankly, I know Paul and I may differ on this, <v Del. Richard Cranwell>but I think the cuts have gone too far. <v Del. Richard Cranwell>And I hope that in the budget process we can soften the impacts. <v Sen. Hunter Andrews>I couldn't agree with him more. <v Sen. Hunter Andrews>We have cut percentages for higher education from 16 <v Sen. Hunter Andrews>percent of the general fund to twelve. At the same time, North Carolina is increasing

<v Sen. Hunter Andrews>theirs. We have the highest tuition rate of any state in the nation except <v Sen. Hunter Andrews>Vermont. Our contributions per student, we rank with Arkansas, <v Sen. Hunter Andrews>Mississippi and West Virginia eight. <v Sen. Hunter Andrews>And I think we in a better category, I think we have a fine higher education system. <v Sen. Hunter Andrews>You can improve, but you cannot continue to cut that and cut back. <v Sen. Hunter Andrews>Now, I think some of the schools having to do the horn properly, <v Sen. Hunter Andrews>some of the schools have done a good job in tooting the horn and they got the attention <v Sen. Hunter Andrews>of their going administration. But there are three or four schools that have done <v Sen. Hunter Andrews>important things of ratcheting things around, but they're getting penalized for it. <v Sen. Hunter Andrews>And I hope we can correct that. <v Chris Dickon>Questions are on the floor whether you and the governor have the same sentiments. <v Paul Timmreck>Well, we do have the same sentiments. <v Paul Timmreck>I think I know the governor is going to be speaking to higher education when he unveils <v Paul Timmreck>his budget amendments very shortly. He did talk about them last Monday evening <v Paul Timmreck>during the state of the Commonwealth address on the issue of higher education.

<v Paul Timmreck>I would simply remind everybody that when you take higher education and 15 percent of the <v Paul Timmreck>budget in elementary and secondary at 35, you already have about half the budget- <v Del. Richard Cranwell>I think it's 12 percent isn't it? <v Del. Richard Cranwell>[arguing] <v Sen. Hunter Andrews>Yes, I know. Yeah. <v Sen. Hunter Andrews>used to be fifteen. <v Paul Timmreck>That is when we have in the past when we have exempted things like Medicaid from the cuts <v Paul Timmreck>and we've exempted elementary and secondary education. <v Paul Timmreck>There's not a whole lot left, you know, in terms of trying to balance the budget. <v Paul Timmreck>So I think that the higher education area continues to be a challenge. <v Paul Timmreck>The schools can do more to restructure and to be more efficient. <v Paul Timmreck>There's no question about that. Southern, some of them have done more than others. <v Sen. Hunter Andrews>Well, that's a relative term. It depends on how we will get into this. <v Sen. Hunter Andrews>I understand your party line, but we also Governor Allen has recommended <v Sen. Hunter Andrews>the increase in tuition should not exceed inflation, which means that you've got to come <v Sen. Hunter Andrews>up with the money. <v Paul Timmreck>On 1920-. <v Sen. Hunter Andrews>And I'm quite sure that you will find that money. <v Sen. Hunter Andrews>And if that happens and we'll have harmony for a momment.

<v Del. Richard Cranwell>I thought all the extra money was gonna go into a trust fund for retirees. <v Paul Timmreck>No, the governor said on Monday evening that he wanted to cap the tuition <v Paul Timmreck>at three and three point one percent in two years. <v Paul Timmreck>And so that's why-. <v Sen. Hunter Andrews>That's 19 million- <v Paul Timmreck>That's 19 million dollars. That's right. General fund money. <v Chris Dickon>Senatot Andrews-. <v Paul Timmreck>Good news for the taxpayers. <v Chris Dickon>You're beginning to sound like some of the people who attend the state hearings that you <v Chris Dickon>conduct across the state for the last three years before the general simply asking people <v Chris Dickon>to come and say what they want from the state and how it ought to be paid for. <v Chris Dickon>And for the third time in a row, you heard people say we can't take any more cuts in <v Chris Dickon>human services and mental health and arts and libraries and education. <v Chris Dickon>And we ought to pay more taxes in order to pay for these things that there's that <v Chris Dickon>sentiment coming from the people who also want to see that money come back. <v Chris Dickon>How is all of that cranked into the process? <v Sen. Hunter Andrews>Well, it's very important. <v Sen. Hunter Andrews>We think that public hearings have been very beneficial. <v Sen. Hunter Andrews>It gives the people an opportunity to express themselves.

<v Sen. Hunter Andrews>We listened to over 500 and some speakers and many <v Sen. Hunter Andrews>people come there espousing thier cause. <v Sen. Hunter Andrews>But that's democracy and that's right. <v Sen. Hunter Andrews>But you get a kind of insight into what the main issues are. <v Sen. Hunter Andrews>I said my name. You know, it is the usual thing. <v Sen. Hunter Andrews>Don't take from me, don't take from the take from the man behind the tree. <v Sen. Hunter Andrews>And one of the gentlemen said, well, there's a man behind the tree over that. <v Sen. Hunter Andrews>You take me and that we take Medicaid. <v Sen. Hunter Andrews>Well, of course, you can't do that. <v Sen. Hunter Andrews>But we think it's been beneficial. At some point, you got to bite the bullet and the <v Sen. Hunter Andrews>secretary is certainly bitten the bullet. Now he's going to bite a nineteen hundred <v Sen. Hunter Andrews>nineteen million shortfall on this and we gonna open up Mecklenburg Prison. <v Sen. Hunter Andrews>What's that? 14 million you've got to find that. <v Paul Timmreck>Over two years it'll be 15. <v Chris Dickon>Delegate Cranwell the difference between the Finance Committee in the Senate is that <v Chris Dickon>you're concerned with both revenue and spending and <v Chris Dickon>gathering money. right. <v Chris Dickon>The Finance Committee of the House is mainly concerned with the revenue side.

<v Chris Dickon>How do you get the money? <v Del. Richard Cranwell>We're, we're yeah- <v Del. Richard Cranwell>In terms in terms of a balance sheet, if you turn in liabilities versus assets <v Del. Richard Cranwell>were in the liabilities. <v Del. Richard Cranwell>But I mean-. <v Sen. Hunter Andrews>He's being very modest, he's no liability. <v Sen. Hunter Andrews>He has muscle. <v Del. Richard Cranwell>We're all on the liability side, I can tell you that right now. <v Chris Dickon>But in this in this no new taxes mode that we're in. <v Chris Dickon>Is there a lot of work for that for the House financial committe? <v Del. Richard Cranwell>Well. I'd like to get that in perspective. <v Del. Richard Cranwell>I really don't think we're in a no new tax mode. <v Del. Richard Cranwell>You know, we have increased income tax one time in 42 years in Virginia <v Del. Richard Cranwell>and we have increased the sales tax one time in 30 years. <v Del. Richard Cranwell>So I don't think there's any major risk <v Del. Richard Cranwell>out here floating around there's going to be any increases in income tax or the sales <v Del. Richard Cranwell>tax. <v Del. Richard Cranwell>So I don't think that that that has <v Del. Richard Cranwell>been any history in Virginia of excessive

<v Del. Richard Cranwell>taxation, We rank, what, forty fifth in the country? <v Paul Timmreck>[unclear] We've always ranked low. <v Del. Richard Cranwell>That's what counts. <v Sen. Hunter Andrews>The last increase in the income tax was another demonstration of my Republican friend, <v Sen. Hunter Andrews>Governor Holton, when we increased in 1972. <v Paul Timmreck>One quarter of one percent. <v Chris Dickon>Here's a proposed tax. The the the highway people say <v Chris Dickon>that between now and the year 2010, we're going to need 52 billion dollars <v Chris Dickon>in spending just to keep our highways up to speed. <v Chris Dickon>Thirty four percent of the bridges in the state right now are deficient, according to the <v Chris Dickon>federal highway Administration. <v Chris Dickon>The Virginia Association of County for one, is talking about an increased <v Chris Dickon>fuel tax of maybe five cents a gallon. <v Chris Dickon>We have very low fuel tax, relatively speaking, in this state. <v Chris Dickon>I think we've already heard that something like that will not be considered in this <v Chris Dickon>session. <v Sen. Hunter Andrews>He said not in this session. Right. <v Sen. Hunter Andrews>But we have just completed a two year legislative study of

<v Sen. Hunter Andrews>the highway needs and is matter of fact, the report just been out. <v Sen. Hunter Andrews>And I certainly hope the new administration keeps an open mind on the subject because <v Sen. Hunter Andrews>we've gone too far back to the very situation we had in Virginia in the early 80s, <v Sen. Hunter Andrews>where the maintenance costs of skyrocketing and new construction <v Sen. Hunter Andrews>moneys are not. Their cars are becoming more efficient and the use of gasoline <v Sen. Hunter Andrews>is decreasing relative to the car. <v Sen. Hunter Andrews>Yet the number of registrations are going up and we don't want to get to the point <v Sen. Hunter Andrews>that we did in the 80s. <v Sen. Hunter Andrews>This is my personal opinion, where we slow up construction, the construction <v Sen. Hunter Andrews>industry slows down. Jobs are lost. <v Sen. Hunter Andrews>And then in 1986, when we cranked it up, we had a time delay <v Sen. Hunter Andrews>in industry cranking up things. <v Sen. Hunter Andrews>And that's an economic stimulus. We have the lowest gasoline tax of any of our <v Sen. Hunter Andrews>surrounding states, six some percent in North Carolina, seven cents under <v Sen. Hunter Andrews>Maryland at some point.

<v Sen. Hunter Andrews>We are gonna have to find the funds to do it. <v Sen. Hunter Andrews>And I'm hoping and I'm confident that the new administration, when <v Sen. Hunter Andrews>they have time to reflect on the matters, that we can cooperate and solve it. <v Chris Dickon>Timmreck, is this a matter of making decisions about when <v Chris Dickon>falling behind on something might cause you to have to add <v Chris Dickon>more to get back up to speed than you would otherwise if things get too bad? <v Paul Timmreck>No, I don't. Chris, I don't think this will affect the governor's decision making at this <v Paul Timmreck>point. I think the issue for him is that he wants to go into the six year plans. <v Paul Timmreck>He wants to look at the projects that have been approved. <v Paul Timmreck>He wants to basically assure himself and others that every one of <v Paul Timmreck>those projects is absolutely essential, that there aren't more economical ways to address <v Paul Timmreck>those transportation needs. And I think, you know, once you get over that hurdle, the <v Paul Timmreck>governor's already indicated that he's not no forever to-. <v Sen. Hunter Andrews>No he has not. And I think he's entitled to have more time. <v Sen. Hunter Andrews>I don't think the door was shut. And I agree with Delegate Cranwell. <v Sen. Hunter Andrews>He said he's not favor of increasing income and sales tax, but there are a lot of other <v Sen. Hunter Andrews>ways to raise revenue like exemptions from sales tax.

<v Sen. Hunter Andrews>We've got the largest number exemptions from our sales in any state in the nation. <v Chris Dickon>Do you think- <v Sen. Hunter Andrews>[unclear] to this to that. <v Del. Richard Cranwell>We've got the lowest per capita sales tax rate, second lowest per capita sales tax rate <v Del. Richard Cranwell>in the country in terms of revenue collected per capita from sales tax. <v Chris Dickon>Well, one of the goals of the state is economic development. <v Chris Dickon>The governor said he would like to create one hundred twenty five thousand new jobs in <v Chris Dickon>the next four years of his term. <v Chris Dickon>Well, when you're looking at economic development through things like the discussion <v Chris Dickon>we've just had about education and highways come into that. <v Chris Dickon>The argument seems to be if we raise taxes, business will stay away. <v Chris Dickon>But another part of the argument is, if the roads aren't good, schools aren't good, <v Chris Dickon>business will stay away. <v Sen. Hunter Andrews>Well, I go ahead. <v Paul Timmreck>I mean, there are all kinds of studies about taxes and what not. <v Paul Timmreck>I think what's really important to a prospective business is the stability of the <v Paul Timmreck>climate, the predictability of the climate, the absence of any kind of anti or <v Paul Timmreck>punitive attitude toward the business community. <v Paul Timmreck>When discussions were held with Disney, it was very clear to us that they really did

<v Paul Timmreck>find a lot of attraction in the fact that Virginia had not increased those income taxes <v Paul Timmreck>since 1972. <v Chris Dickon>And you brought up Disney as we speak on Thursday after, this Disney day here <v Chris Dickon>in Richmond and people coming to talk about that. <v Chris Dickon>Those who oppose the Disney Disneyland in Northern Virginia say it could cost the state <v Chris Dickon>as much as two hundred million dollars for roads and highways and that kind <v Chris Dickon>of the infrastructure that's viewed to support it. <v Chris Dickon>I know the Governor Allen is very supportive of the Disney project. <v Chris Dickon>What do you think is that is the real potential cost of state. <v Paul Timmreck>The real cost, the real costs that are tied directly to the impact of Disney. <v Paul Timmreck>Disney itself, apart from all the other transportation improvements that are <v Paul Timmreck>already approved for that area up there, would total seventy eight point nine million <v Paul Timmreck>dollars. That's a far cry from two hundred million dollars. <v Paul Timmreck>And the other figures that you've heard about. <v Paul Timmreck>And that's a combination of transportation improvements, as well as certain operating <v Paul Timmreck>improvements that many of which will benefit all of Virginia in terms of tourism

<v Paul Timmreck>promotion. <v Chris Dickon>What do you think is the sense of the assembly on this? <v Sen. Hunter Andrews>Well, we haven't received the package. <v Sen. Hunter Andrews>We just had a briefing today, dog and pony show, you know, with <v Sen. Hunter Andrews>which is fine. It was very informative when the bills <v Sen. Hunter Andrews>are in and we will proceed. <v Sen. Hunter Andrews>And I guess I think they wanted acted on that in this session. <v Sen. Hunter Andrews>Am I correct, Paul? <v Paul Timmreck>Yes, absolutely. <v Sen. Hunter Andrews>So I hope they put the bills in shortly. <v Del. Richard Cranwell>It's like ask in' me if I like a book before I read it, I have to read it first and then. <v Chris Dickon>OK. Finally, in the meantime, there is a 500 million dollar gorilla sitting in the room, <v Chris Dickon>and that's the case with the federal pensioners. <v Chris Dickon>It's difficult to get a fix on what people think ought to be done or that should we wait <v Chris Dickon>until all the court things are. <v Sen. Hunter Andrews>Well, <v Chris Dickon>We wish we'd be. <v Sen. Hunter Andrews>Well, it's not what we think Governer Allen said he's going to proceed to settle the <v Sen. Hunter Andrews>case. And I assume when he reaches what he thinks is a proper <v Sen. Hunter Andrews>settlement, then he will come to us for the money and make proposals on where to get the <v Sen. Hunter Andrews>money.

<v Paul Timmreck>And in the meantime, Governor Allen has also said that he would like to basically propose <v Paul Timmreck>the establishment of a down payment on a reserve fund, which would be the source <v Paul Timmreck>of money for those payments. <v Chris Dickon>So are we looking at negotiation for this? <v Sen. Hunter Andrews>But is not in the hands of the gentleman is the point I'm trying to make-. <v Paul Timmreck> Exactly. He's instructed the attorney general basically to enter into those <v Paul Timmreck>negotiations. On the [unclear] case. <v Sen. Hunter Andrews>On the other side, you know, we won every phase of this case in court ever since <v Sen. Hunter Andrews>we've been in this for over four years, but now it's been taken away from us. <v Sen. Hunter Andrews>But I do think it will probably come back to us for money. <v Paul Timmreck>Because the governer perspective is it's not whether you want or not in court. <v Paul Timmreck>It's what's what's right to do beyond the <v Paul Timmreck>court decisions. And the governor believes that they were wrong that the federal <v Paul Timmreck>pensioners, both civilian or military pensioners were wronged in that in that case. <v Paul Timmreck>So he thinks the right thing to do is to enter negotiations, to arrive at a mutually <v Paul Timmreck>satisfactory-. <v Sen. Hunter Andrews>And he will tell us where to find the money. <v Paul Timmreck>Yes, sir. <v Chris Dickon>I think at that point of getting along together, we need to stop.

<v Sen. Hunter Andrews>We are gonna get along together. Look, this is the guy who deserves the credit for his <v Sen. Hunter Andrews>financial credit rating. <v Chris Dickon>All right. Secretary Paul Timmereck, Senator Andrews, Delegate Cranwell, thank you all <v Chris Dickon>very much. And thank you for being with us on this edition of Assembly Week.