The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1995, Landmark Communications, Inc.

DATE: Sunday, December 24, 1995              TAG: 9512240042
SECTION: FRONT                    PAGE: A1   EDITION: FINAL 
SOURCE: BY MARGARET EDDS AND DAVID M. POOLE, STAFF WRITERS 
                                             LENGTH: Long  :  120 lines

CONSERVATIVES ASK: IS ALLEN CAVING IN? HIS BUDGET SHOWS LESS COST-CUTTING ZEAL - A NOD, SOME SAY, TO POLITICAL REALITIES.

Introducing House Speaker Newt Gingrich at a breakfast last week, Gov. George F. Allen whimsically referred to himself as ``Baby Newt.''

A few hours later, Allen unveiled a $34.6 billion, two-year budget proposal that was anything but Gingrich-esque.

The governor - who a year ago penned tax cuts and budget revisions with the zeal of a conservative patriot - put forward a spending plan so conciliatory that many Democrats applauded and some in the conservative base of Allen's party winced.

Pragmatists say Allen has made a necessary midcourse correction; ideologues wonder whether he has surrendered the Revolution.

In choosing pragmatism over ideology, the governor bowed to the political realities of his failure to win a majority in either house of the General Assembly in the fall election, Allen advisers and political analysts say.

His calculated decision, at least for now, to forgo some of the most polarizing parts of his agenda and to clean up his ``knock-their-soft-teeth-down-their-whiny-throats'' rhetoric is viewed by moderates in both parties as a sign of maturization.

That course will boost Allen's credibility during his final two years in office, and beyond - to a possible race for the U.S. Senate in the year 2000, they say.

But for conservatives who see the task of reinventing government as still incomplete, Monday's performance by Allen was disappointing.

``If Republicans in Congress had pushed only those things for which they had the votes to pass, we never would have gotten a majority in Congress,'' said Morton Blackwell, who runs a training school for conservative operatives and represents Virginia on the Republican National Committee.

``I don't think he has capitulated entirely, but he's compromising a little bit,'' said Joe Guarino of Newport News, executive director of Virginia Citizens for Excellence in Education, a group that pushes for more parental control of public schools.

``What would they have me do?'' Allen replied Friday when told of conservatives' criticism. ``The point is to get things done, not just carp and score debating points.''

Allen said reports of the demise of his conservative principles are premature. He said his 1996-98 spending plan is stocked with notions that challenge the status quo, such as new student achievement tests designed to ensure that extra money for schools is making a difference; limits on college tuition increases; cuts to state support for public radio and television; and reductions in general relief to the disadvantaged.

``There's plenty of calculated risk in this budget,'' he said.

To underscore his point, Allen noted that he complained to a state housing official when he saw a proposal for adding an extra $1 million to the budget for indoor plumbing for Virginians who are without it.

``There's a place we can cut,'' Allen said, recalling his message. Only when he learned that the money was coming from the federal government, not the state, did he agree to the proposed expenditure, he said.

Despite Allen's protests, however, other budget analysts see marked change between the proposed 1996-98 budget and the revisions suggested by Allen to last year's budget. That plan was originally proposed by Allen's predecessor, former Gov. L. Douglas Wilder.

This year's is the only biennial budget that will be both drafted by Allen and primarily spent during his administration. As such, it is viewed as a blueprint of his vision of state government.

With the GOP takeover of Congress in November 1994, Allen appeared intent last year on pushing Virginia to the vanguard of the conservative movement. His budget cut taxes $2.1 billion over five years, slashed programs for disadvantaged students and senior citizens and provided money for ``charter'' schools that would be freed from state regulations in exchange for innovative ideas.

This year's budget proposal abandoned tax cuts, added about $1 billion for public schools and colleges, and left intact programs once recommended for axing.

Among the changes, according to legislative budget analysts:

Funding for at-risk students, which Allen wanted to virtually eliminate last year, would be increased by about $1 million under this year's recommendation.

About $22 million would go for expansion of the 4-year-old, pre-school program to include an extra 3,500 children. Some conservatives think this gives government too early a sway over children.

Last year, about $550,000 was included for charter schools. This year's proposal doesn't include charter school money. Nor is there funding for tuition tax credits or vouchers for children who attend private schools, other ideas popular with conservatives.

This year's recommendation leaves intact $1.5 million for school-based health clinics, funding Allen tried to eliminate last year. Some conservatives equate the program with condom giveaways in public schools.

Individuals close to Allen said the altered recommendations were governed by several factors: tight fiscal times, a sometimes-unnoticed solution-oriented streak in the governor, and a degree of personal hurt over the election results.

``This budget is being driven as much by the pure numbers as by the political changes out there,'' noted M. Boyd Marcus, a GOP consultant who worked in Allen's gubernatorial campaign.

``George has a practical streak that most people don't recognize until he does something like this,'' added Kenneth Klinge, another adviser to that campaign.

Some analysts with an eye to history say that Allen has already established what his legacy will be through the abolition of parole, a dramatic overhaul of Aid to Families With Dependent Children, and a whittling back of state employee rolls.

Even if nothing else were added to that trio, Allen would still have had as substantial an impact in changing Virginia government as any governor in recent memory, they said.

The revolution, some conservatives say, will have to wait until when Allen leaves office in two years and Republicans get another crack at controlling the General Assembly.

``It took us a long time to get where we are today, and it will take us a little longer to get where we want - and that's not unreasonable,'' said House Republican Leader S. Vance Wilkins of Amherst.

His budget shows less cost-cutting zeal - a nod, some say, to political realities. ILLUSTRATION: Color photo

Gov. Allen: His education plan earns praise and skepticism/B1.

by CNB