Mere days after the largest nationwide anti-tax rallies the likes of which haven’t been seen since prior to the start of the American Revolution, the City Council of Woonsocket, RI (Yes, THAT RI, with a sales, income, AND property tax, basically the highest in the country…) stood poised to stick the taxpayers with a “supplemental” tax bill to fund a budget shortfall in it’s school department. Essentially, the property taxpayers– with commercial owners paying 2-1/2 times the rate– would be sent a so-called “5th Quarter” tax bill. Normally, taxes are billed and paid in quarterly payments in the year.

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The local paper, The Woonsocket Call described the events:

Harris Hall was so packed that admittance was closed after about 130 spectators filled the room. People were standing against the back walls because there weren’t any more seats left and there was a line of speakers behind the lectern waiting to address the council that snaked out into the foyer. More than two hours after the session began, people were still waiting for their turn to speak, and the council hadn’t even recited the Pledge of Allegiance to mark the formal start of the agenda.

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The expected 6 to 1 vote favoring a supplemental tax bill to be foisted up Woonsocket taxpayers turned into a stunning 4 to 3 midnight vote, DEFEATING it!

An incredible display of citizen activism and organization. Want to start the momentum here? Get involved and attend Shenandoah County’s budget hearing next Thursday, April 30 (time pending). Although currently real estate taxes are not slated to be increased. there is talking of an increase on the vehicle tax (which Superivsors claim due to declining asessments will be “revenue neutral,” words always to be suspicious of when it comes to taxes assesed by value), it is important to ask questions about where the money is going and where it’s coming from. To borrow two old cliches: Sunlight is the best disinfectant, and knowledge is power.

Gov. Timothy M. Kaine said Monday that Virginia’s budget shortfall has grown more than 25 percent since December, bringing the gap between revenue and spending to more than $3.7 billion over two years as the economy worsens.

But Kaine (D) told legislative leaders in a closed meeting that the federal stimulus bill, expected to be signed into law Tuesday, will offset the additional $800 million shortfall for the two-year, $77 billion spending plan that runs through June 2010.

However, although this may seem like manna from heaven, this “fix” isn’t exactly without costs. From Tertium Quids:

According to this chart, our impoverished Uncle up North will be cutting the state a nice, guaranteed-not-to-bounce check for various and sundry items, including $1.2 billion for “budget balancing.”

That’s sweet. I’m sure our grandchildren will thank us one day for mortgaging their future to the world’s debt merchants so we can square our books today. 

If we’re lucky, that is. They may decide to show their gratitude by send us all to the crooked old folks home. Or they might develop a taste for Soylent Green.

You didn’t think this money was coming out of thin air, did you? Norm doesn’t even touch upon the rather serious implication of states relying upon federal dollars in order to correct their own fiscal mistakes. How are we to expect that our federalist system will maintain its careful balance when the the federal government is bailing out the states every time mismanagement occurs? Why even have states? 

But these questions are for another time. From the time being, the Senate has adopted a wait and see approach to see just how big of winners we are in the Generational Debt Lotto. t to pass their budget today. Worry not. The fireworks are just beginning.

Seriously, though, be sure to remind your Delegate and State Senators that Virginia should get its due. The citizens also deserve an exact accounting of the costs.

And while you’re at it, you may want to remind Governor Kaine that the PIC is a private entity that accepts donations. His leadership PAC has about $319,000 in it, and Virginia’s citizens sure could use the relief right now…..

“In the age of Obama, where Democrats preach ‘hope,’ ‘change,’ and ‘open government,’ its disappointing to see that those are meaningless words,” said Cuccinelli.  “The reality is that the status quo is willing to block anything that allows the people to see into how their government is really run.”

I have to admit that in the initial publicity surrounding this year’s transparency bills I thought the measures were only for the state government. While other bills do focus on the state government, I think this bill may have been even more important. Even though its closer to most people’s lives, local government often does not get enough notice or attention. Such an open look at the goings-on of local government probably would have a put a halt to the sort of minor corruption that goes on all the time, such as the government paying for employees lunches (and I’m not talking Christmas Dinner here) or indiscriminate use of petty cash. 

Wonder where VACO stood on this one?

Last year, it said it would cost more than $1 million. This year, between $1.5-$3 million. This might seem plausible except for the fact that no state has created such a search engine for more than $300,000 and the federal government put its $2 trillion of annual spending online for $1 million. Virginia spends a “paltry” $39 billion each year. Most states have done it for free, because OMB Watch, a group that created the software for the feds, has made it available for free to states!

So today, working with the National Taxpayers Union (special thanks to Josh Culling), we secured a statement that will will distribute to the General Assembly. It comes from the Treasurer of Nebraska. He created NebraskaSpending.com by Executive Order in 2007. He proved that putting a searchable budget database online could be done inexpensively without compromising its purpose. For $38,000, NebraskaSpending.com includes information on state government dollars to be spent, state dollars received, investment operation pool, grants, contracts, and a breakdown of property taxes and state aid.

“There is this mood, this feeling in the air. I can feel a much more aggressive passion to get control,” said Del. Paul F. Nichols (D-Prince William). “We feel there is . . . light at the end of the tunnel.”

Republicans, tired of losing statewide races, vow not to cede any more ground to Democrats. Instead, Republicans say they will be the party on the offense, targeting Democratic incumbents in the House and pouring money into Attorney General Robert F. McDonnell‘s campaign for governor.

“They are going to see a new Republican Party in 2009,” said Lt. Gov. Bill Bolling (R), who is running for reelection.

The stakes are higher this year than most. Legislators must cut at least $3 billion from the state’s two-year, $77 billion budget, which will require deep reductions in vital government services such as health care.

Word on the street says most of the most targeted races have already staffed up, so this is sure to be a marquee year, particularly for political professionals.

Slowing economic growth combined with an overly optimistic revenue estimate led legislators to spend billions more than the state will collect in tax revenue this year.

The problem is deeper than that, according to Gilbert.

“The problem with the state budget crisis that we find ourselves right now is that the growth of the budget has grown far in excess of the needs of the citizens of the commonwealth of Virginia,” he said.

Both Democrats and Republicans have been part of the problem, Gilbert said.

Republicans have “prided ourselves in being able to stop tax increases, but that’s only half the equation,” he said.

“In years where we’ve had booming tax revenues, we’ve done what politicians collectively try to do — be all things to all people,” he said.

As drawn, the proposal would put a hard cap on tax revenue and budget growth at the rate of inflation and the rate of population growth combined.

“Those two markers are the most accurate measures of the true needs of how the budget should grow,” he said.

Taxes collected in excess of the growth limit would go two places — 75 percent would be refunded to individual taxpayers, with the balance deposited in the state’s “rainy-day” reserve fund.

Using Gilbert’s formula, Virginia’s budget would have been capped at about 28 percent growth from 2000 to 2006.

Real appropriations grew some 49 percent over the same period, according to data compiled by the Legislative Audit and Review Commission, the legislature’s investigative arm.

Certainly I think the proposal has a great deal of merit and puts government in the position it should be in: only spending the money it has and being, first and foremost, responsible to the people who are giving them that money in the first place. However, I have some concerns with the practical outcomes of the bill. In Colorado, which has had TABOR in place since 1992, we have seen a steady progression from red to blue, with many observers blaming TABOR, the thought being that it puts too great of a strain on essential services when people were looking for more, more, more. Certainly, though, I’d like to hear more about the proposal. 

There is another budgetary bill that I DEFINITELY gung-ho about, though, and it’s also from Delegate Gilbert. That is HB2356, which would require that all future budget processes begin with zero-based principles. Simply put, that would mean that rather than just throwing another percent onto the budget each year, government departments would start at zero and fill in the blanks, meaning that departments would be required to justify each and every expenditure.

For those of you who aren’t familiar, “oversight” is not a word that most Richmond bureaucrats are not familiar with. Budget sessions don’t focus around the efficacy of individual programs but rather a department should get a 4% or a 5% increase, regardless of the performance of each and every program. This allows some absolutely ineffective and duplicative offices to continue their work unabated, as they are able to ride on the “essential” nature of other offices. Again, there are some questions here: Would legislators be able to effectively conduct the sort of oversight needed in the context of being part-time? I think that needs to be addressed; as it stands, though, I’m all in favor of anything that requires government officials to justify their existence. People have to do it in the private sector all the time–why not them?

But whatever you do, be sure to take a listen as we take this exciting new journey into a new means of communication.