McDonnell, GOP lawmakers assail Kaine's budget plan

Gov.-elect Bob McDonnell and Republican legislators threw cold water yesterday on Gov. Timothy M. Kaine's proposal to raise the state income tax and other taxes to help bring a $4.2 billion budget deficit into balance.

"It's a nonstarter," Del. M. Kirkland Cox, R-Colonial Heights, a senior Republican budget-writer, said of Kaine's proposal to eliminate the local car tax and substitute a state income-tax increase.

Making further cuts in the state budget is "going to be tough," Cox acknowledged, and he suggested that one area to look at would be one of Kaine's pet projects, funding for pre-kindergarten education.

McDonnell, who will succeed Kaine on Jan. 16, promised to work "in a bipartisan fashion" with House and Senate money committee leaders to make the cuts necessary to balance the budget, but he added that "it is bad economic policy to increase taxes on Virginians" during a recession.

Speaker of the House William J. Howell, R-Stafford, said Kaine's proposed tax increases "have no chance of receiving General Assembly approval." He said Kaine made the assembly's task harder by embedding state tax increases in the budget.

If Kaine were serious about repealing the local car tax and substituting another tax, "if he really thought that's what was right for Virginia, he should have proposed it in year one, year two or year three," House Majority Leader H. Morgan Griffith, R-Salem, said.

"Now he waits until he's got less than 30 days to go and he starts proposing something and then saying, 'you all have done it wrong.'"

Reached in New York, former Gov. Jim Gilmore, who rode to office on his promise to repeal the car tax, said Kaine is proposing a "sleight-of-hand" by trying to replace one tax with another. The idea that the public doesn't care about the car tax is "nonsense" said Gilmore, who was elected governor in 1997.

Sen. Charles J. Colgan, D-Prince William, chairman of the Senate Finance Committee, said he has long wanted to repeal the car tax. As for the chances of its repeal, Colgan said the assembly will have to wait to see how the public reacts.

Sen. R. Edward Houck, D-Spotsylvania, a senior member of the Finance Committee, said the tax-increase proposal will give legislators a chance to debate the virtue of increased revenues versus cuts in public service.

"The game is on," he said.

Sen. Janet D. Howell, D-Fairfax, deplored the proposed budget cuts, which she said would hurt public education and "the frail and elderly."

"We've gone beyond cutting fat and muscle and we're into amputating," she said.

State employees reacted negatively to Kaine's proposal to lay off 664 employees and direct state employees to contribute to their retirement.

R. Ronald Jordan, lobbyist for the Virginia Governmental Employees Association, described the proposals as "a gut shot" to state employees, who already are demoralized about their future.

The state's 114,000 state employees and their families "will make our voices heard and vigorously oppose these actions," Jordan said.

John Jones, executive director of the Virginia Sheriffs Association, said the governor's proposals to cut funding for local sheriffs and police departments by almost 20 percent could endanger public safety. Public safety funding was cut by $30 million in September, he noted.

To cushion the blow the assembly might consider raising court fees, including the serving of process fees, he said.

"We are in a crisis situation," Jones said.

Robley Jones, lobbyist for the Virginia Education Association, praised Kaine for preserving public education funding during previous budget cuts, but said the new proposal to cut $1.3 billion will hurt.

"Class sizes will get larger and electives will be dropped," he said. It is a "bleak situation" that could get bleaker if the assembly rejects Kaine's revenue proposals, he said.

Laurie Peterson Aldrich, president of the Virginia Retail Merchants Association, said the association and its 5,400 members plan to lobby vigorously against the proposal to eliminate the dealer discount.

The discount, which amounts to $60 million a year, is the portion of state sales tax that businesses keep for collecting the tax and remitting it to the state.

"In this economic time, it will hurt significantly," she said. Kaine failed in an attempt to eliminate the dealer discount in the 2009 assembly session.

Contact Tyler Whitley at (804) 649-6780 or twhitley@timesdispatch.com.