Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, February 7, 1991 TAG: 9102070430
SECTION: EDITORIAL PAGE: A-11 EDITION: METRO
SOURCE: RAY L. GARLAND
DATELINE: LENGTH: Long
Gov. Douglas Wilder announced an additional revenue shortfall of $176 million, which brought the total current estimate of money the state won't collect in the 1990-92 biennium to almost $2.2 billion. If this amount were actually taken off the top of the $26.4 billion budget as adopted last year, it would represent a rather stunning reduction of 8 percent, and would bring state spending in this budget very close to levels prevailing in 1988-90.
But there won't be an 8 percent reduction in state spending, or anything close to it. Much of the $2.2 billion shortfall is to be covered by moving the lottery profits from capital projects and by "borrowing" from the Virginia Retirement System and other honey pots.
If the state Senate has its way - and Wilder has said it won't - a further $463 million would be raised from general-obligation bonds. If Wilder has his way - and the Senate may not go along (the House almost didn't) - $162 million would be taken out of the Literary Fund to make payments to the retirement system. The Literary Fund, which provides low-interest loans for public-school construction, would be replenished by issuing $175 million in bonds secured by future revenues.
No wonder a senior member of the Senate Finance Committee, Dudley J. Emick, D-Botetourt, refused to vote for the Senate's version of the 1991 amended budget, saying it contained too many initiatives paid for with "funny money."
One of the "funny money" ideas sailing through the assembly would allow state employees with 25 years' service to retire at age 50 with the same pension, along with other "sweeteners," that they would attain after 30 years. The expectation is that this will save the state money now by leaving positions unfilled - or by filling them with younger workers at less money. But the plain truth is that these costs merely will be transferred to the retirement system. And money might not be the only cost if experienced people are lost during years of what should be peak performance.
The College of William and Mary sounded an alarm, but nobody heard. Officials pointed out that 61 senior faculty at the school would be eligible for the early-retirement option and that if any considerable number took advantage of it, their program would be seriously undermined. Such sober objections were brushed aside in the mad rush to claim another $10 million or so to cover the shortfall. But what you have to understand is that the ultimate cost of this particular "savings" will be paid for several times over.
One legislator who believes he has at least a partial cure for the problem is Del. Clinton Miller,R-Shenandoah. Miller is an odd duck among the 140 legislators, a clever country lawyer who is also a pretty fair country singer; and a Democrat-basher who gets along well with colleagues of that persuasion. He manages to do this because he is simpatico and because he enjoys bashing Republican icons almost as much.
Miller has even astonished himself by persuading the House to approve an amendment to the state constitution allowing the legislature to recess for about three weeks as soon as the House and Senate money committees complete their work on the budget. The idea is to allow the public and the 105 legislators not on those two committees to "understand" the budget and propose changes in it.
Now, this is a long way from becoming an accomplished fact. It will have to be approved by both houses next year and then by the people in a referendum. While the idea has a certain superficial appeal - and it's certainly a fact that the assembly is trying to cram too much activity into too short a time - I put Miller's proposal down as a case of the game not being worth the candle.
The history of amendments to change the budget once it has emerged from the money committees is an almost unbroken record of failure. When legislators are given the opportunity to suggest amendments, they almost always ask for more money. Such cuts as are from time to time suggested generally come under the heading of "small beer/good politics."
When a genuine money steamroller comes down the pike, it is usually powered by a political engine such as the state employees' lobby or the teachers' lobby. It may lock taxpayers into billions of additional costs stretching into the indefinite future, but rare is the legislator who will attempt to derail it - and he is often not heard from again.
Even the vaunted money committees generally nibble only at the edges of budgets as presented by the governor. That's understandable. The vast bulk of state's spending is based upon fixed costs and prior commitments that form a base line for anticipated annual increases.
And those who believe that Virginia's busy four-year governors understand and can justify all aspects of the budget are likely to believe a great many other things equally fantastical. As the legislature is largely the captive of gubernatorial budget-makers, so is the governor largely the captive of the bureaucracy.
The legislature could have three weeks or three years to "study" the budget and it wouldn't know much more than it did to start. Unless, that is, it actually got on the inside and studied the workload, productivity and necessity of every employee and agency.
That being so obviously impractical, Virginia needs a thorough management study by outside experts and should have started one when this fiscal crisis first appeared. It wouldn't be cheap, quick or very palatable, but it is the kind of thing that private enterprise does all the time, and often with astonishing results.
by CNB