THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Friday, February 3, 1995 TAG: 9502030601
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY DAVID M. POOLE AND WARREN FISKE, STAFF WRITER
DATELINE: RICHMOND LENGTH: Long : 111 lines
Gov. George F. Allen suffered the biggest setback of his year-old administration Thursday when Democrats on two General Assembly money committees repudiated his tax-cut initiatives.
The rejection capped a day in which the legislature thumbed its nose at virtually every element of Allen's attempt to overhaul government, with the Senate also snubbing welfare reform and charter schools and trimming Allen's request for money to build prisons.
Democratic lawmakers showed no election-year trepidation in bucking a plan that they say would provide modest tax relief at the expense of law enforcement, higher education and mental health services.
``I'm not willing to sell out the future of Virginia for 33 pieces of silver,'' declared Senate Finance Chairman Hunter B. Andrews, referring to the $33 in state income tax relief Allen's bill would mean to a middle-income family of four.
With virtually no hope of reviving his signature proposal this year, Allen vowed to press forward in hopes of exacting revenge against Democrats this November when all 140 legislative seats will be on the ballot.
Allen said Democrats acted cowardly by dispatching the tax cuts in ``smoke-filled committee rooms'' and denying him a hearing before the full Senate and House of Delegates.
The Republican chief executive said he would use every means at his disposal to force a floor vote in both chambers.
``The people of Virginia will know where everyone stands,'' said Allen, flanked by GOP lawmakers at a news conference minutes before the money committees met.
Allen refused to say whether he would compromise. Democrats, angered by the governor's description of them as ``elitist and status-quo dictators,'' were in no mood to extend an olive branch. Many seemed thrilled that they ruined the governor's day.
``Why compromise when you're ahead?'' asked House Speaker Thomas W. Moss Jr., D-Norfolk. ``If anyone should be offering a compromise, it's him.''
Moss said there was nothing insidious about killing bills in committee, a process that was in place when Allen served in the state legislature.
``Bull crap,'' Moss bellowed when told of Allen's claim that Democrats feared a floor vote. ``That's not a problem. I've gotten about 300 letters from home, and maybe two or three were for the tax cuts.''
Still, Moss said he was not inclined to look favorably on efforts to circumvent the Assembly's committee system. ``Why should I give him what he wants?'' Moss said of Allen.
``The fact that he wants it makes me against it.''
The quick demise of the five-year, $2.1 billion reduction in state individual income taxes and local business receipts taxes left some lawmakers wondering how Allen came up with the idea in the first place.
Del. Lacey I. Putney, a Bedford lawyer and the Assembly's lone independent, noted that Allen mentioned nothing about cutting taxes during the gubernatorial campaign in 1993 or his first 11 months in office.
The first indication, Putney said, came in December after Allen hosted a Williamsburg conference of Republican governors where the mood was euphoric following the GOP's massive victories in congressional elections.
``Something tells me that his tax cut may have been spawned at that meeting,'' Putney said.
State Sen. John H. Chichester, a Republican from Fredericksburg, faulted Allen for not consulting with GOP lawmakers before announcing his tax proposals last December.
``I don't think the philosophy of the bills was well thought out,'' Chichester said. ``. . . No one can pull off these kinds of reforms without first bouncing it off the people who have to carry the ball.''
In closed-door meetings, some Republican lawmakers complained that the tax relief would lead to $149 million in spending cuts for popular programs in their districts such as schools, museums and cooperative extension services.
Thursday, Allen provided a rambling answer when asked to explain his basis for thinking that his mandate included cutting taxes.
Allen said his goal from the start was to slow the rate of growth in state government spending; that creating jobs was a top priority; that people should be able to keep more of what they earned; and that the only way to control growth was to limit the amount of tax revenue.
Allen refused to consider the possibility that tax cuts that have proven wildly popular in other states failed to ring true in Virginia, which has not raised income tax rates in more than a decade.
Allen sidestepped questions about a recent letter from three of his predecessors - Mills E. Godwin Jr., Linwood Holton and Gerald L. Baliles - who praised Virginia's history of low taxes and warned that reducing revenue would imperil state-supported colleges and universities.
``I'm not ashamed of my philosophy,'' Allen said. ``I'm fighting for what I believe in.''
The Senate Finance Committee - in a straight party decision - voted 12-3 to kill both of Allen's tax-cut initiatives. The House Finance Committee voted 14-8 to dispatch a plan to eliminate local gross-receipts business taxes and 15-7 to reject a plan to triple the personal exemption for state income taxes.
The Senate panel also scaled back Allen's plan for prison construction. The governor had proposed $181 million in borrowing for immediate prison needs, plus a $227 million bond issue subject to voter approval in November. The committee killed those bills and approved an alternative $172 million proposal.
Commenting on Allen's losses Thursday, House Finance Committee Chairman C. Richard Cranwell cited public opinion polls that indicated most voters oppose the spending cuts that would result from the tax cuts.
``I have a hard time grasping the basis for this policy,'' he said. ``. . . Politics is driving it. Look at the governor's statement. He's already talking about the November elections.'' ILLUSTRATION: Color photo
Gov. George F. Allen has virtually no hope of reviving his proposal
to trim taxes $2.1 billion over five years.
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