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February 28, 2011

Where Does Wasteful Government Spending Stop?

In testimony before the House Committee on Oversight and Government Reform, posted this month at George Mason University’s Mercatus Center, Veronique de Rugy, senior research fellow, points out, “wasteful spending does not stop at earmarks and overpayments.”

She says: “In fiscal year 2010, the federal government spent $3.6 trillion dollars, or 24.6 percent of GDP,  well above the historical average. The consequence of this spending was $1.3 trillion in budget deficits.  A large part of this overspending was improper spending or spending that never should have happened at all.” However, she adds:

“But these debt numbers pale in comparison to unfunded liabilities. According the Financial Statement of the United States, in 2010 the net present value of the promises made to the American people for which the United States does not have the money to pay is roughly $75 trillion.

“The harsh reality is that if the country does not deviate from its current path, the majority of future federal spending will finance the spending of the past.”

What is important in de Rugy’s testimony are the three questions she says that Congress should be asking about all future spending. She writes:

“In the face of ballooning government spending, Congress must focus on where and when the federal government should spending money.  To do that it should consider three questions: federal spending on functions that should be reserved for the states, federal spending on functions that should be reserved for the private sector, and federal spending on things that government has no business doing in the first place . . . .”

To pursue just one of those questions, she points out that federal spending should not replace state spending, adding:

“This confusion over federal versus state authority extends to area such education, transportation, and homeland security.  For instance, Congress allocates most of homeland security spending to pay for things that are local in nature such as hazmat suits and first responders’ radios.”

For example, she writes that “federal grants to state and local governments spur wasteful spending.” Why” Because:

“The incentive structure of aid programs encourages lawmakers at all levels of government to overspend.  These programs allow lawmakers to claim credit for spending on a program without the responsibility of collecting the entire tax bill necessary for the funding.”

“Also, grant design often gives states an incentive to increase their spending on these programs. A funding formula based on “matching” provisions for instance means that for every dollar the state spends the federal government will shoulder some of the total amount, thereby lowering the states’ burden of the cost, and hence giving states an incentive to increase its provision. Under a 50-50 matching rule, for every $1 a state spends on a program, the federal government chips in $1. Matching reduces the consequences of increasing spending, thus prompting the states to expand programs.”

If you need proof of that statement, take a look at any of Arlington County’s Comprehensive Annual Financial Reports (CAFR) or budget documents that are available at the county’s Department of Management & Finance website. I’ll growl about this more in a future posting.

So when talking about wasteful federal spending with your favorite Congressmen, be sure to determine if they have their spending priorities in order.

February 27, 2011

Average Cost of a Stimulus Job = $228,055

Last Thursday, CNS News reported that according to a report released last week by the Congressional Budget Office (requires Adobe) the average job “created and saved” by the American Recovery and Reinvestment Act, signed into law on February 17, 2009, (aka the stimulus bill or Porkulus) “cost at minimum an average of $228,055 each.” The online news service writes:

“In a report released Wednesday—“Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output from October Through December 2010”—the CBO said it now estimates the stimulus law cost a total of $821 billion, up from CBO’s original estimate that the stimulus would cost $787 billion.

"In the same report, the CBO estimated that in the fourth quarter of 2010 there were somewhere between 1.3 million and 3.5 million people who were then employed who would not have been had the stimulus not been enacted. “CBO estimates,” says the report, “that ARRA’s policies had the following effects in the fourth quarter of calendar year 2010: … Increased the number of people employed by between 1.3 million and 3.5 million.”

“This estimate seeks to state the net impact the stimulus had on the number of people employed in the United States as a result of the stimulus, taking into account not only the new jobs believed to be created and the existing jobs believed to be killed by the stimulus, but also the existing jobs that were saved that otherwise would have been lost.

[ . . . ]

“Thus, the $821 billion cost of the stimulus divided by the maximum of 3.6 million jobs the CBO believes the stimulus may have saved or created equals an average of $228,055 per job.”

Doesn't it make you feel good to know your tax dollars are used with such economy and efficiency? 

HT American Thinker.

February 26, 2011

A Way Through the Entitlements Tsunami

Earlier this month, we growled to urge ACTA members to save Friday, February 11 for a forum at CPAC on the practical steps to reform entitlements. The forum was sponsored by the National Taxpayers Union Foundation.

NTUF has now posted the videos of the forum. The presentations by the five members of the panel range between about 11 to 20 minutes while the panel discussion is about 30 minutes (the individual presentations are at two separate links and the panel discussion is at a third link):

In a story posted February 17 at Breitbart.com, the Associated Press reported:

“President Barack Obama said Wednesday that difficult debates on how to address the costs of Social Security and Medicare are "starting now," even though his 2012 budget blueprint lacked any major changes to the large benefit programs.

[ . . . ]

"In an interview with a Cincinnati television station, Obama did not offer any specific modifications but did not take Social Security off the table . . . .

“We're starting now. I mean, the conversations have already begun," Obama told WCPO television, the ABC affiliate in Cincinnati.

“In another interview with WWBT-TV in Richmond, Va., Obama said, "There may need to be some adjustments on the benefits side for future beneficiaries that aren't drastic. But (they) would stabilize the system for the long term."

ABC News also reported on February 17 that “lawmakers are stuck on Medicare, Medicaid, Social Security Fixes,” but added that President Obama and the GOP “agree entitlement program need reform -- but not what kind.” As an indicator of the size of the entitlements program, ABC wrote:

“The three programs have ballooned to 57 percent of the government budget this year and are widely cited as the most significant contributors to the federal deficit, something nearly all Americans want to see aggressively brought under control.

“But while lawmakers from both parties agree on curbing the skyrocketing costs of the programs, few have endorsed a specific way to get that done.

“President Obama, who's come under fire for not offering a detailed vision for fixing entitlement spending in his 2012 budget, said Tuesday that he's prepared to work with both parties to "start dealing with that in a serious way."

“Republicans, meanwhile, who also haven't united around their own path to reform but promised their forthcoming budget would include a step forward, said they are "waiting for presidential leadership."

Not everyone agrees there is a problem with entitlements, however. For example, on February 16, Jazz Shaw writes at Hot Air:

“There are a number of persistent memes coming from one side of the aisle about the future of Social Security and what, if anything, needs to be done about it to right the nation’s fiscal ship. Some are clearly hyperbolic, such as the oft repeated story about how certain politicians want to “throw old people out in the streets so we can give tax cuts to the rich.” That may win some points come election time, but it’s not based in reality.

“A second, and perhaps more damaging theme, is demonstrated again this week by Steve Benen at The Washington Monthly. Of the four biggest items presenting budget challenges to the nation, Steve goes so far as being willing to admit that, “Medicare is facing fairly serious fiscal problems.” (Thanks for that, by the way.) But then follows it up with the all too common song and dance claiming that Social Security is just fine. Nothing to see here. Move along.”

The Wall Street Journal’s ($) Holman Jenkins has an op-ed worth-reading in this weekend’s Journal. He writes:

“News reporters may be naïve, and some of the protesters may pretend to be. But this fight was penciled in long ago, when politicians and union leaders made the strategic decision to negotiate benefits without negotiating for the funding to make good on them. The mock shock and horror is all the more laughable given that events in Wisconsin are a perfect microcosm of the battle that every sentient American knows, and has known for a generation, awaits Medicare and Social Security.

“In keeping with the theatrics of naïveté, President Obama now calls for "beginning a conversation on entitlements." One wonders what it was, then, that G.W. Bush began at the 2004 Republican convention, or what thinkers and activist groups that have been pushing visions of entitlement reform for decades have been doing.

“Has the president not heard of the private sector's pioneering work on "defined contributions"? Or Bill Clinton's landmark Medicare commission in 1999? One might as well wonder what pain is coming to those Obama followers who have yet to suspect their thoughtful liberal might be a visionless apparatchik.”

Jenkins also provides a couple of numbers that are truly shocking, at least to this scribe, saying:

“Medicare is the real killer. According to Eugene Steuerle of the Urban Institute, an average couple retiring last year can look forward to consuming Medicare benefits with a present value of $343,000, having paid Medicare taxes with a present value of $109,000.

“And don't let that figure get your hopes up, because even that $109,000 is not available today. That money was spent long ago. The government's trust funds are a fraud. Indeed, by some large amount, society missed out over many decades on domestic savings and investment that would have taken place had workers not been relying on unfunded government promises to support them in retirement.”

Additional resources, but certainly not even intended to scratch the surface, on entitlements are available:

February 25, 2011

The Bureaucratic Pecking Order

Dan Mitchell, a tax reform expert at the Cato Institute, has a chart at Big Government today that he says “tells you everything you need to know about state and local government pay.” He writes:

“The data on total compensation clearly show a big advantage for state and local bureaucrats, largely because of lavish benefits (which is the problem that  Governor Walker in Wisconsin is trying to fix). But the government unions argue that any advantage they receive disappears after the data is adjusted for factors such as education.

“This is a fair point, so we need to find some objective measure that neutralizes all the possible differences. Fortunately, the Bureau of Labor Statistics has a Job Openings and Labor Turnover Survey, and this “JOLTS” data includes a measure of how often workers voluntarily leave job, and we can examine this data for different parts of the workforce.

“Every labor economist, right or left, will agree that higher “quit rates” are much more likely in sectors that are underpaid and lower levels are much more likely in sectors where compensation is generous.”

He then provides the following chart based upon data from the Bureau of Labor Statistics.


Mitchell writes this about the above chart:

“This helps explain why the unions are treating the Wisconsin debate as if it was Custer’s Last Stand. The bureaucrats know they have comfortable sinecures and they are fighting to preserve their unfair privileges.”

In addition, Mitchell provides the following You Tube video produced by the Center for Freedom & Prosperity:

There Are too Many Bureaucrats and They Are Paid too Much

He points out the “video looks at all of the data and reveals a pecking order. Federal bureaucrats are at the kings and queens of compensation. State and local bureaucrats are like the nobility. And private sector taxpayers are the serfs that worker harder and earn less, but nonetheless finance the entire racket.” Mitchell closes by writing:

“The video closes with a very important point that the right pay level for many bureaucrats is zero. This is because they work for programs, departments, and agencies that should not exist."

The video is just under 7 minutes, and is well-worth watching. In addition, you may want to read this Tax & Budget Bulletin about employee compensation in state and local government (requires Adobe), written by Chris Edwards of the Cato Institute. We growled about it on January 7, 2010.

February 24, 2011

Another Porker of the Month Named

The federal government already borrows about 40 cents of every $1 dollar, but there are still Congressional politicians who continue pushing pork barrel projects. The latest pork pusher is Rep. Jerrold Nadler (D-New York) who was named by Citizens Against Government Waste as February’s Porker of the Month:

“ . . . for his continued insistence on wasting tens of billions of taxpayer dollars on federal high-speed rail (HSR) projects.  On January 27, 2011, Rep. Nadler called for $117 billion in federal funding for HSR over the next 30 years.  If history is any guide, total costs will be dramatically higher.

“Rep. Nadler has claimed that federal spending on HSR will “generate an operating surplus of $900 million per year,” which is unlikely.  Amtrak was supposed to earn a profit when it was purchased by the government in 1971, but it has required $37 billion in subsidies since then.  Taxpayers understand that if the government can’t turn a profit on lower-cost, low-speed rail, it will never earn a dime on higher-cost, high speed rail.  According to a March 2009 Government Accountability Office report, HSR will cost between $22 million to $132 million per mile.”

“HSR has also been billed as a method to reduce carbon emissions and road congestion.  But most traffic jams are caused by commuters, not inter-city travelers, and recent studies have shown that the carbon benefits of HSR are much smaller than typically advertised, especially if ridership is lower than expected.  Despite these drawbacks, the Obama administration proposed an additional $53 billion over six years for HSR in the fiscal year (FY) 2012 budget, an initiative that Rep. Nadler supports.

“CAGW has long opposed federal funding for HSR.  Government-subsidized high-speed rail was a ludicrous idea when $8 billion was included for it in the stimulus package; it is an even more asinine idea now that the debt has skyrocketed to more than $14 trillion,” said CAGW President Tom Schatz.  “HSR is a prime example of government ‘investment’ that should be identified for what it is: more pork and wasteful spending that will misuse scarce capital resources and expand the nation’s massive deficit and national debt.  A majority of the House of Representatives showed they agree with CAGW on this issue when they passed the Full-Year Continuing Resolution for FY 2011 that zeroed out funding for HSR.”

You can see a You Tube video presentation that explains why Rep. Nadler earned being named February’s Porker of the Month. Reason.tv now produces the video of each month’s Porker presentation; here’s the archive.

Call Nadler’s office on Capitol Hill. His Washington Office phone number is:

202-225-5635

February 23, 2011

Assured? Arrogant? Brash? Cocksure? Hmmmm!

Today’s Arlington Sun Gazette reports today that “Legislators Get Their Revenge, Killing Key Arlington Economic Priority.” The legislation, SB 980, patroned by Sen. Mary Margaret Whipple would have extended “the sunset date for the additional transient occupancy tax in Arlington County from January 1, 2012, to January 1, 2015,” and the revenues from the tax would have to be “spent for promoting tourism and business travel in the county.” Accordng to Scott McCaffrey in the Sun Gazette:

“State Republicans unhappy with the Arlington County government’s since-abandoned lawsuit over HOT-lanes exacted revenge in the waning days of the General Assembly.

“The GOP-dominated House of Delegates killed the second of two County Board legislative priorities for 2011, bills whose defeats collectively will cost the county government nearly $3 million in potential revenue each year.

“By a 54-42 vote, largely but not exclusively along party lines, House members on Feb. 22 rejected a bill to extend Arlington’s existing authority to impose a 0.25-percent tax surcharge on hotel rooms, a measure that brings in about $900,000 a year for tourism promotion.

“The defeat was even more stinging than the vote total suggested, as Arlington needed 67 votes in the House to pass the measure, as tax bills for a single jurisdictions required a two-thirds vote in each body.”

More of the history of the kerfuffle can be found in a January 31, 2011 Washington Examiner story by David Sherfinski, who wrote:

“Arlington County stands to lose $3 million over three years after a House of Delegates subcommittee Monday killed a plan to extend the county's hotel tax -- the latest flare-up in a spat between Del. Tim Hugo, R-Fairfax, and Arlington officials.

“Hugo, who chairs the House Finance subcommittee that considered the tax extension, said he killed it because he objects to a lawsuit Arlington County filed in 2009 to halt the construction of high-occupancy toll (HOT) lanes along Interstates 95 and 395.
"Obviously Arlington has an abundance of money if they can be engaged in egregious lawsuits against private individuals," Hugo said.

The Sun Gazette’s Scott McCaffrey concludes the story writing in part:

“This is not the first year the tax-surcharge measure has faced tough sledding in Richmond. Six years ago, the House initially rejected a proposed three-year extension, but the bill was resurrected by the end of the session.

“This time around, county officials hired a lobbyist at a cost of up to $18,000 solely to try to gain passage of the measure. But the efforts of the lobbyist, county staff and the six-member legislative delegation proved no match against House Republicans intent on reminding Arlington who controls things in Virginia governance.

The saga of Arlington’s transit occupancy tax recalls to mind one of my first trips to Richmond and a visit to the General Assembly building. An employee in the basement  coffee shop asked me where I was from. After telling her that I lived in the “Peoples Republic of Arlington,” I wasn’t sure how long it would be before she stopped chuckling. Guess I didn't need to ask her about the panjandrums on the Arlington County Board.

Additional Sun Gazette reporting can be found here, here, and here. We growled previously about Arlington's transient occupancy tax on January 22 and January 31, 2011.

February 22, 2011

Quote of the Day

 "It is a wise rule and should be fundamental in a government disposed to cherish its credit, and at the same time to restrain the use of it within the limits of its faculties, 'never to borrow a dollar without laying a tax in the same instant for paying the interest annually, and the principal within a given term; and to consider that tax as pledged to the creditors on the public faith.'"

    ~ Thomas Jefferson, letter to John Wayles Eppes, 1813

HT Patriot Post

February 21, 2011

Quote of the Day

"Taxes are necessary. But the system of discriminatory taxation universally accepted under the misleading name of progressive taxation of income and inheritance is not a mode of taxation. It is rather a mode of disguised expropriation of the successful capitalists and entrepreneurs."

   ~ Ludwig von Mises

HT: Page 141,  "As Certain As Death: Quotations About Taxes," TaxAnalysts.com

February 20, 2011

Deft and Shrewd? Not!

The “Revenue Summary and Detail” pages of Section A (Budget Summaries) of the Arlington County Manager’s proposed FY 2012 budget (page 95 in the "book version" of the budget) contains the following comment at the top of one page (the web version does not contain page numbers):

“The following chart compares the major residential taxes and fees for the Northern Virginia jurisdictions for the average household using Calendar Year 2010 rates and assessments.”

The chart that follows the above statement shows the tax burden for three taxes and three fees that Arlington and its neighbors in Northern Virginia have in common, and appears designed to show just how much more taxes and fees burden the citizens of Fairfax County, Falls Church, etc. than weigh down the citizens of Arlington County.

Unfortunately, the chart's designer used the average single family home value in Arlington, i.e., $503,200 for CY2010, to compute the real estate taxes paid in the other Northern Virginia jurisdictions. Consequently, the chart shows that the average single-family home owner in Loudoun County paid $6,893 in real estate taxes rather than $5,028.

If the chart’s designer had turned the page, he or she would have found another chart on page 96 -- labelled “Comparison of Northern Virginia Jurisdictions’ Real Estate Tax Bill for the Average Single-Family Home” -- showing the “ average assessed value for five of the six jurisdictions on page 95. Recomputing the real estate taxes paid on the average single-family home, using the “average assessed values” on page 96, produces a much different comparison. For example:

  • Fairfax County: Instead of $5,560 in real estate taxes, the figure should be $4,778. The amount for the six taxes and fees should be a total of $6,600, or $258 less than Arlington (3.8%). However, the chart on page 95 of the Manager’s proposed FY 2012 budget shows Fairfax County’s tax/fee burden is $525 more than Arlington (7.7%).
  • Prince William County: Instead of $6,615 in real estate taxes, the figure should be $3,306. The amount for the six taxes and fees should be $5,116, or $1,742 less than Arlington (25.4%). However, the chart on page 95 of the Manager’s proposed FY 2012 budget shows Prince William County’s tax/fee burden is $1,567 more than Arlington (22.9%).
  • Loudoun County: Instead of $6,893 in real estate taxes, the figure should be $5,028. The amount for the six taxes and fees should be $6,652, or $206 less than Arlington (3.0%). However, the chart on page 95 of the Manager’s proposed FY 2012 budget shows Loudoun County’s tax/fee burden is $1,658 more than Arlington (24.2%).

So instead of residents of Alexandria paying 1.8% more than Arlington residents for those six taxes and fees, those Alexandria residents actually pay 6.1% less than Arlington residents pay.

Guess you don’t need to check your assumptions when you work for a world-class county, the claim made in the county’s vision statement.

HT Wayne Kubicki 

February 19, 2011

Computing Effective Tax Rates 101

On Tuesday evening, February 15, the Arlington County Board voted 5-0 to advertise a real estate property tax rate of 96.8 cents per $100 of assessed value. We previously Growled about that, but deferred any discussion of the percentage increase. That rate includes the 1.3 cent stormwater sanitary district tax. It is also 1 cent above the CY 2010 real estate tax rate, according to the county’s press release.

Fortunately for taxpayers, the Code of Virginia (§58.1-3321) requires taxpayers to be notified whenever the annual assessment would result in an increase of 1% or more, and requires the computation of the “effective rate increase.” For CY 2011, Arlington County accomplished this requirement in Attachment V of County Board agenda item 29.A. If the Board eventually adopts the FY 2012 budget with the advertised rate, the effective real estate tax rate increase would be 6.7%. This at a time when the inflation rate is less than 2%.

Of course, since the Board “only” advertised a rate that is 1-cent above what the Manager used to propose a balanced budget, they were happy to read how the media reported the increase:

  • Arlington Sun Gazette. The online headline of the story included: “advertise slight rise,” and in the first paragraph, the paper wrote that the Board, “voted to advertise a 1-cent (1.04-percent) increase in the real estate tax rate.”
  • ARLNow. The headline said the Board “advertises small tax rate increase,” but made no mention of the computation of the rate increase.

Don’t let the Board bamboozle you when they say they merely voted to advertise a 1-cent increase in the real estate tax rate. Besides, even if the Board chose to advertise the rate used by the Manager to balance her proposed budget, that would still represent an effective rate increase of 6.2%. So be sure you understand the methodology the County Board is required to follow that is in Attachment V, mentioned above.

February 18, 2011

Big Government Won One Today; Fight Back

Felicia Sonmez, blogging at the Washington Post’s Politics and Policy blog, describes how a conservative budget amendment failed in the U.S. House of Representatives amid “fissures among Republicans.” She writes:

“A conservative budget proposal that would have cut an additional $22 billion across federal agencies on top of the $61 billion in cuts already proposed by House Republicans failed the House Friday amid sharp disagreements among Republicans over just how far Congress should go in seeking to rein in federal spending.

“More than 90 Republicans voted against the amendment, sponsored by Republican Study Committee Chairman Jim Jordan (Ohio).

“The final 147 to 281 vote saw members of the House Republican leadership splitting their votes, with House Majority Leader Eric Cantor (Va.) and Majority Whip Kevin McCarthy (Calif.) voting against the measure and Budget Committee Chairman Paul Ryan (Wis.) and Republican Caucus Chairman Jeb Hensarling (Texas) voting in favor.” [Footnote 1]

In support of his amendment, Jim Jordan (R-Ohio) said, “If we don't do this, our future for our kids and our grandkids is diminished."

Sonmez also quoted several Democrats, including Rep. Jim Moran (D-Virginia), who represents parts of Northern Virginia and all of Arlington County, who “called it ‘irresponsible’ and ‘imbalanced.’” She added that Moran said, "This amendment would commit this country to an economic death spiral."

By the way, that’s the same Rep. Jim Moran who told this scribe, after rolling his eyes, a few weeks before Congress passed the American Recovery and Reinvestment Act of 2009 (aka stimulus bil, or Porkulus) two years ago that he didn’t know how the nation would pay for the $787 billion cost of ARRA.

The Daily Caller reported yesterday an informative interview involving economist Thomas Sowell on Lawrence Kudlow’s CNBC program. According to the Daily Caller:

“Sowell told Kudlow he didn’t think the country was in immediate danger of losing its position in the world as the economic leader. But the trend isn’t positive, he said.

“Oh, I think it’ll take a while for us to lose that position,” he said. “But I think that the trends right now don’t look promising – again, mainly because of the political leadership. I don’t think there’d be any great problem in shutting down non-essential government workers. I suspect that that would be enough to balance the budget. I don’t think either party’s going to do that.”

“Although Sowell deflected questions about where he sees the country heading politically, Kudlow asked if based on his understanding of history and the current circumstances if he had confidence that the entrepreneurial spirit would win out?

“I do not,” Sowell declared.

"What would it take to change his mind?

“It would take a change in the White House,” Sowell said. “And a change on Capitol Hill.”

You can contact Representatives Cantor, McCarthy or Moran on Capitol Hill by calling (202) 224-3121, or their individual offices at:

  • Rep. Eric Cantor         202-225-2815
  • Rep. Kevin McCarthy   202-225-2915
  • Rep. Jim Moran          202-225-4376 or send an e-mail to Rep. Moran
Footnote 1: Roll Call votes were not posted at the time of this Growls.

February 17, 2011

Quote for the Day

“Public works are not accomplished by the miraculous power of a magic wand. They are paid for by funds taken away from the citizens.”

    ~ Ludwig von Mises

HT OnPower.org

February 16, 2011

The Annual Budget Ritual Formally Begins

Before the Arlington County Board advertised a 6.7% “effective” increase in the real estate tax rate last night, and before the Manager formally presented her proposed FY 2012 budget yesterday afternoon (Overview requires Adobe), Wayne Kubicki, who is considered by many, including this scribe, as Arlington County’s premier budget hawk, testified before the Board (audio and video, as well as .pdf, is available at the Board’s webpage for agenda item 29.A.). Here is a complete text of his testimony:

    “Mr. Chairman, other members of the Board, good evening.

    “Our annual budget ritual officially begins today, and your vote on setting the advertised real estate tax rate – which is the maximum rate that you can set at final budget adoption in April – will to a very large extent determine the shape of the budgetary discussions between now and that final adoption.

    “Back in October, you gave the County Manager very specific guidelines for what her proposed budget was to look like.  For I believe the first time, or at least as long as I’ve been testifying before you, the guidelines were couched in terms of not being balanced within existing tax rates, but in terms of expenditures.  Those guidelines defined budget growth, in terms of County-side spending increasing no more than a fixed percentage, following the terms of the Revenue Sharing Agreement with the schools, and providing for new County facilities coming on line during FY12.  Any new spending the Manager wanted to propose needed to be covered by a new or enhanced revenue stream.

    “The document you were presented with this afternoon complies with your budget guidance to the letter.  Ms. Donnellan and the DMF team are to be commended for presenting you exactly what you asked for – just like they did last year.

    “Staff followed your budget guidance – now, the question is, will the five of you do the same?

    “Back in October, at the time of budget guidance, real estate assessments were projected to be about flat for CY11.  Your guidance, based on that level of assessment, probably would have required about a 5 to 6 cent increase in the real estate tax rate to be in balance.

    “With the higher assessments – up 6.3% to be exact, complying with your original guidance requires no tax rate increase.  There is enough revenue with the actual CY11 assessments to balance a budget with your original guidance.  All of your spending dictates are covered.

    “Which begs the question – why would you vote tonight to advertise a higher rate?

    “If the level of spending as laid out in your guidance was the right path back in October, why now would you raise the possibility of spending more dollars that would result from a rate increase?

    “Actually, there is more money laying around, not detailed in the Manager’s budget book.

    “The unexpected increase in CY11 assessments will create additional current year review, over the amount budgeted, of about $16M – the “June payment effect”, as some call it.  If FY11 is otherwise in balance - & I don’t know why it wouldn’t be – this $16M is “found money”, and it’s not included in the Manager’s proposal.  Even if split 50/50 with the schools, there’ll be about $8M more on the county side.

    “But there’s still more.  It’s my understanding that the $2.2M back billing to the City of Falls Church on the detention center is not included in the budget anywhere.  Ultimately, we should be paid – more found money not reflected in the proposed budget.

    “There is also about $600K listed on non-departmental, representing the costs of operating Mary Marshall and Long Bridge Park for the time during FY12 before these two new facilities will open.  You get to spend that on something as well.

    “So, again, why vote to advertise a higher rate?

    “In some prior years, uncertainties have been cited as a reason for advertising a higher rate, to cover areas where certain revenues (say, from the State) or expenditures (say, Metro) may not yet have firm numbers.  As best I can tell, that is not the case this time around.

    “Advertising a higher rate tonight would be the equivalent of putting out the “open for more spending” sign in front of Courthouse Plaza.  Each special interest group will come out with their wish lists.  The Manager’s proposal already has over $1M more in so-called safety net spending – you’ll be asked for more, from social services, to housing, to parks, to libraries.  Someone, from somewhere, will want to revisit every reduction you’ve made over the past two years.

    “I submit to you that even Arlington is not yet in the financial position to start going down this road.  You have a very easy path to take which can avoid all of this.  Stick with your own budget guidance of just several months ago.  Do not advertise an increase in the tax rate.  Thank you for your time.”

Tomorrow, we’ll Growl about the 6.7% effective increase in the real estate tax rate.

February 15, 2011

Where Is Arlington County Spending Your Money

Yesterday, we growled with an overview of where the county’s revenues were coming from, and where they are being spent. Today, we’ll provide a bit more detail on the expenditures. The expenditure numbers below come from the budget summaries in tab A of the proposed budget (see here).

Actual county services cost Arlington residents $506.9 million in FY 2010. That dropped to $486.5 million in the FY 2011 budget, when it was adopted last April 2010. Now, in the Manager’s FY 2012 proposed budget, the expenditures for county services will increase to $504.1, an increase of 3.6%.

Since personnel costs represent the majority of the cost of local government, let’s take a look at the number of full-time equivalent (FTE) positions “frozen/unfunded” at those points in time.

  • FY 2010 Actual -- 102.25
  • FY 2011 Adopted -- 159.55
  • FY 2012 Proposed -- 136.05

One of the budget summaries shows both the changes in FTE from FY 2010 Actual to FY 2011 Adopted to FY 2012 Proposed as well as the expenditures for each of the 28 elements (five do not have FTE’s, e.g., debt service) of the General Fund. Fifteen of the 23 elements show no change in FTEs between the FY 2011 Adopted and FY 2012 Proposed budgets. Of the remaining eight, the changes in FTE are:

  • Technology Services -- +2
  • Commissioner of Revenue -- -1
  • Treasurer -- - 1
  • Office of Emergency Management -- +8 (Note 1)
  • Fire Department -- +8
  • Environmental Services -- +10
  • Human Services -- +0.8
  • Parks, Recreation, Cultural Resources -- +5

If you are interested in a Growl concerning specific parts of the Manager’s proposed budget, you can contact ACTA. And as we said yesterday, visit frequently for more growling about the county budget.

Note 1: Justified separately in the County Manager's Message to the County Board.

February 14, 2011

Overview of Arlington County’s Revenues & Expenditures

Last week, we growled about the County Manager’s FY 2012 proposed budget after noting that she plans to present the budget without an increase in the real estate tax rate. Let’s take a look today at some of the “overview” numbers in the proposed FY 2012 budget, which is now online. The selected numbers below are from the “budget summary tables” that were provided to the Board at their February 8 worksession:

General Fund Expenditures

  • County Services -- $504.1 million, up 3.6%
  • Metro Operations -- $$24.7 million, up 2.1%
  • County Debt Service -- $55.5 million, down 1.0%
  • School Transfer -- $378,2 million, up 4.9%

General Fund Revenues

  • Real Estate Taxes -- $541.4 million, up 7.2%
  • All Other Taxes -- $278.9 million, up 1.6%

Total General Fund Revenues -- $981.0 million, up 4.0%

Highest General Fund Expenditures

  • Schools -- 38%
  • Public Safety -- 12%
  • Human Services (aka Health + Welfare), 12%

Highest Sources of General Fund Revenues

  • Real Estate Taxes -- 55%
  • Personal Property Tax -- 10%
  • BPOL -- 6%
  • State of Virginia -- 6%

Please return frequently to Growls since we expect to comment on various portions of the proposed FY 2012 budget until the Board adopts the FY 2012 budget on April 16, 2011, at which point the Arlington County Board adopts ownership of the FY 2012 budget.

February 13, 2011

Quote of the Day

 “The standard of living of the common man is higher in those countries which have the greatest number of wealthy entrepreneurs.”

    ~ Ludwig von Mises

HT On Power.org

February 12, 2011

Quote of the Day

"Simply stated, the income tax was a necessary condition for the creation of the welfare state and the resulting social pathologies. The income tax also is the most economically destructive way politicians have ever developed for financing government."

   ~ Daniel J. Mitchell, Page 153, "As Certain As Death: Quotations About Taxes"

HT TaxAnalysts.com

February 11, 2011

Frederic Bastiat on Taxes

"Have you ever heard anyone say: “Taxes are the best investment; they are a life-giving dew. See how many families they keep alive, and follow in imagination their indirect effects on industry; they are infinite, as extensive as life itself.”

[ . . . ]

"The advantages that government officials enjoy in drawing their salaries are what is seen. The benefits that result for their suppliers are also what is seen. They are right under your nose.

"But the disadvantage that the taxpayers try to free themselves from is what is not seen, and the distress that results from it for the merchants who supply them is something further that is not seen, although it should stand out plainly enough to be seen intellectually.

"When a government official official spends on his own behalf one hundred sous more, this implies that a taxpayer spends more on his own behalf one hundred sous the less. But the spending of the government official is seen, because it is done; while that of the taxpayer is not seen, because -- alas! -- he is prevented from doing it. (italics in the original)

[ . . . ]

    ~ Frederic Bastiat

Source: Page 7 in Selected Works, “The Economics of Freedom: What Your Professors Won’t Tell You,” Published by Students for Liberty/Jameson Books

HT StudentsforLiberty.org

February 10, 2011

Your Taxes at Work . . . Multiple Training Programs

The U.S. General Accounting Office (GAO) released a report yesterday (requires Adobe) discussing how “overlapping job-training programs” run up an $18 billion tab. According to the Federal Times today:

“The federal government spends $18 billion a year on 47 separate job training programs run by nine different agencies. All but three programs overlap with others to provide the same services to the same population, according to a government report released Wednesday."

According to the GAO report, "(F)ederally funded employment and training programs play an important role in helping job seekers obtain employment." Three departments -- Labor, Education and Health and Human Services -- “largely administer the programs." Among other things, GAO found:

“Due to the American Recovery and Reinvestment Act of 2009 (Recovery Act), both the number of—and funding for—federal employment and training programs have increased since our 2003 report, but little is known about the effectiveness of most programs. In fiscal year 2009, 9 federal agencies spent approximately $18 billion to administer 47 programs—an increase of 3 programs and roughly $5 billion since our 2003 report. This increase is due to temporary Recovery Act funding.  Nearly all programs track multiple outcome measures, but only five programs have had an impact study completed since 2004 to assess whether outcomes resulted from the program and not some other cause.

“Almost all federal employment and training programs, including those with broader missions such as multipurpose block grants, overlap with at least one other program in that they provide similar services to similar populations. These programs most commonly target Native Americans, veterans, and youth, and some require participants to be economically disadvantaged.”

As the Federal Times quotes Sen. Tom Coburn (R-Oklahoma):

"Here's just one example of how we're spending $18 billion, and we don't have any idea of whether it's working or not . . . This thing is so big and so out of control."

The assistant secretary of HHS may be correct in saying that 'overlap' is not the same as 'dubplication.' However, as GAO points out, the number of programs has increased since 2003, little is known about program effectiveness, and there are a number of options for increasing efficiencies.

February 09, 2011

Tea Party Magazine to Launch at CPAC

Politico announced today that Tea Party Review magazine is to launch at this week’s CPAC meeting. According to Politico:

“The magazine will be published monthly with an annual subscription rate of $34.95. The publication is a project of Higher Standard Publishers, which has published such books as The Power Within a Conservative Woman, Confessions of a Black Conservative, Why the Conservative Mind Matters, and the satirical children’s book Help! Mom! Radicals are Ruining My Country!

“The magazine’s companion Web site will keep abreast of Tea Party developments between monthly issues of the magazine. Edited by Christina Botteri – one of the organizers of the original Tea Party rallies in February 2009 – the site will be an invaluable resource, fully integrated into the magazine’s operations. The magazine will enable subscribers and other Tea Party supporters to track key issues in addition to the movement’s activities across the country.

“Topics in the first print edition of Tea Party Review range from grassroots Tea Party lobbying to foreign policy, from Big Business political corruption to methods to which the Tea Party movement can appeal to Latino immigrants. “There’s a profile of the first Tea Partiers elected to statewide office, a look at key figures in history such as Alexis de Tocqueville and Booker T. Washington, and even a comic strip about a Tea Party congressman dealing with the Red Chinese,” Pierson noted.

“The “Tea Party Review’s team of writers, artists, and editors reflect the diversity of the movement, including individuals from all over the country incorporating a wide variety of backgrounds. The magazine includes people who’ve never contributed before to a national magazine, along with people who have written for major publications like the Chicago Defender and The New York Times.”

If you are attending the entitlements forum at CPAC on Friday -- see our February 2, 2011 Growls -- be sure to stop by the Tea Party Review book and subscribe to the new magazine. You can subscribe to Tea Party Review at their online webpage. Here's the cover of the inaugural issue:

 

February 08, 2011

No Real Estate Tax Rate Increase in Arlington County Manager’s Proposed Budget

During an approximately 1.5 hour meeting this afternoon, the Arlington County Manager proposed a FY 2012 budget that would keep the average homeowner’s tax and fee burden to less than the inflation rate (CPI-Urban). According to the press release distributed after the meeting:

“At the current tax rate of 95.8 cents per $100 of assessed value (including the sanitary district tax), the overall tax and fee burden for the average Arlington homeowner would increase 1.4%, from $6,398 to $6,487 – about $7 a month. The increase is less than the current inflation rate of 1.5% in the metropolitan area.”

More detail on the Manager’s proposed budget can be found at the Department of Management and Finance’s FY 2012 budget webpage, where there is a link to the slide presentation used by the Manager in briefing the County Board; budget tables from the proposed budget; and the Manager’s message, which includes a discussion of her Emergency Communications Center initiative.

Will the County Board advertise a higher real estate tax rate next Tuesday when the Manager formally proposed her FY 2012 budget? My guess is that the five panjandrums  will do so.

February 07, 2011

Your Taxes at Work . . . Paying Erroneous Tax Credits

An Associated Press story reported by CNS News last Thursday says:

“A Treasury Department inspector general's report says nearly 13,000 taxpayers, including prisoners and some IRS employees, wrongly claimed about $33 million in credits for plug-in electric and alternative vehicles during the first six months of 2010.

“President Barack Obama has pushed for 1 million electric cars on the road by 2015 and the tax breaks are part of the strategy. The government has offered numerous incentives to drum up interest in the vehicles, including a $7,500 tax credit for plug-in electric vehicles and incentives for converting a car into a plug-in.

“But the review found problems with thousands of taxpayers claiming the credits for cars that failed to qualify.”

From the report by the Treasury Inspector General for Tax Administration (TIGTA), issued January 21, 2011 (requires Adobe), TIGTA performed the audit because it “is required to monitor” IRS’s implementation of the 2009 Recovery Act, i.e., the stimulus bill, aka “porkulus.” From the “highlights” page, the auditors found:

“As of July 24, 2010, TIGTA identified 12,920 individuals who electronically filed their tax returns and erroneously claimed $33 million in plug-in electric and alternative motor vehicle credits. In addition, 1,719 of the 12,920 individuals also erroneously reduced the amount of Alternative Minimum Tax owed by almost $5.3 million. During this review, management took corrective actions to reduce erroneous claims when process weaknesses were brought to their attention. These actions have resulted in an estimated $3.1 million in revenue protected. The erroneous claims TIGTA identified resulted from inadequate IRS processes to ensure information reported by individuals claiming plug-in electric and alternative motor vehicle credits met qualifying requirements for vehicle year, placed in-service date, and make and model.

“In addition, TIGTA found that the IRS is unable to track and account for plug-in electric and alternative motor vehicle credits claimed by individuals on paper-filed tax returns.  Processes were not established to capture this information from paper-filed tax returns.

“Finally, our review of electronically filed tax returns also identified individuals who erroneously claimed the same vehicle for multiple plug-in electric and alternative motor vehicle credits or claimed an excessive number of vehicles for personal use credits. TIGTA also identified improper claims for the credits by prisoners and IRS employees. TIGTA has referred the information on the IRS employees to its Office of Investigations for further review.”

According to Google’s “News Search” facility, there has been little reporting of the erroneously claimed electric car tax credits by the mainstream media. However, the Detroit News reports today that Sen. Debbie Stabenow (D-Michigan) “unveiled a legislative proposal today to boost electric vehicles sales by letting buyers claim tax credits at the time of purchase.” The newspaper went to report:

“The Lansing Democrat unveiled the Charging America Forward Act — a bill that would authorize the U.S. Energy Department to award another $2 billion in grants "for the manufacturing of advanced batteries and components, and provide facility funding awards" for vehicle batteries, hybrid electrical systems and components.

“The bill would include a provision to make it easier for electric vehicle owners to quickly use a government tax incentive.

“Stabenow's proposal would allow purchasers to get the $7,500 as a rebate at the time of purchase — such as at a car dealership. It would also extend and expand a tax credit for purchasing medium or heavy-duty plug-in hybrid trucks until 2014. The tax credit would be worth between $15,000 and $100,000, depending on the truck's size.

Ken Green, writes at AEI's EnterpriseBlog:

"As I’ve written before, electric and plug-in hybrid vehicles are eligible for an array of subsidies at the state and federal level. Well, it turns out I was wrong. You don’t have to buy an electric or plug-in hybrid vehicle to qualify for the federal tax credit of $7,500, you just have to claim it. According to Richard Rubin over at Bloomberg.com, “About 20 percent of U.S. tax credits for plug-in electric vehicles and alternative-fuel vehicles were filed in error, according to a government audit.” Not only did people who bought regular gasoline-powered vehicles claim the tax credit, prisoners and IRS employees also claimed the credit."

What a concept? More taxpayer subsidies for cars that can’t be sold in the free market. Seems like Sen. Stabenow needs a lesson in free market economics.

February 06, 2011

Your Taxes at Work . . . Overstaffing Arlington County?

A bit of number crunching in the Fiscal Year 2010 Comprehensive Annual Financial Reports (CAFRs) of Arlington County and Fairfax County shows Arlington County has 17.61 county positions per 1,000 residents (tables K and M on pages 179 and 181) while Fairfax County has 10.41 full-time employees per 1,000 residents (table 4.1, page 253, and table 5.1, pages 256-257).

Admittedly, Fairfax County has a Redevelopment and Housing Authority and a Park Authority, which are shown separately from the primary government functions, but their inclusion would not significantly alter the above numbers. Fairfax County also has several towns, but again those would not make a significant difference in the number of local government employees per 1,000 residents.

A positive note for both counties is in the trend from 2001 to 2010. In Arlington in 2001, there were 18.70 employees per 1,000 residents, but that number has decreased to 17.61 by 2010. In Fairfax County, the trend goes in the same direction, dropping from 10.78 in 2001 to 10.41 in 2010.

Let’s take a look at staffing for Arlington’s Department of Human Services (called health and welfare in Fairfax County). Again the number of staff per 1,000 residents is significantly higher in Arlington (dropping from 3.57 per 1,000 in 2001 to 3.31 per 1,000 residents in 2010). In Fairfax County, the number goes from 2,85 per 1,000 in 2001 to 2.67 per 1,000 in 2010.

Looks like Arlington County needs an Inspector General to provide a measure of oversight. Else, Arlington’s panjandrums have used the goodwill of Arlington’s taxpayers to fatten the staffing calf, and there needs to be some serious workplace reengineering.

February 05, 2011

Thank You, President Reagan

Tomorrow, February 6, 2011, marks the 100th anniversary of the birth of Ronald Reagan, America’s 40th President (1981-1989). Steve Forbes, writing at Fox News on Friday, tells us what Reagan taught us:

“It is not just Reagan's specific achievements, though, that inspire people today, that leave so many of us yearning for his brand of leadership. It is also his profound faith in the essential goodness of the American people and in the exceptional role the U.S. has been destined by the Almighty to play in the world. Reagan was a master of the stage. But the Great Communicator's power came from deeply held convictions, not from superficial eloquence. Reagan's words represented his core. There was no slight-of-hand in his speeches; he didn't use liberal language to disguise or hide his agenda.

“People, young and old, feel that Reagan had an optimistic understanding of what this nation could achieve and a deeply felt gratitude for so much of what we had done before. Like our Founders, RR knew well the underside of human nature; his father was an alcoholic, which scarred his childhood enormously. But Reagan also knew that a society whose institutions, culture and aspirations were designed to bring out our best instincts, while checking our worst, could achieve what no other society had done before in creating opportunities for innovators and allowing all of us, as Abraham Lincoln would have put it, to improve our lot in life.

“Reagan's presidential achievements bore out his optimism. He knew that if the federal government did its part to provide a more stable dollar and reduce the burden of excessive taxation and regulation, combined with a strong, purposeful foreign policy, the United States would soar ahead - and the rest of the world would follow.”

Laura Clarizio posted a nice summary about the 40th President of the United States at Examiner.com today, including quotes and a video of a portion from his “Tear Down This Wall” speech.

For more about President Reagan, visit The Ronald Reagan Presidential Foundation & Library.

UPDATE (2/6/11): Four of many essays about the late President that have appeared around this weekend.

  • "Ronald Reagan's America," by Jeffrey Lord, former Reagan White House political director, in Friday's American Spectator. Jeffrey Lord writes, "In the great 20th century struggle between the Communist/socialist world view and freedom, Reagan repeatedly drew fire for bluntly speaking what came to be understood as essential truths."
  • "Reagan vs. the Progressives," by Paul Kengor, professor of political science at Grove City College, in Friday's American Spectator. According to Kengor, "We must learn what Ronald Reagan learned: The progressive left isn't going away, ever-awaiting the next step in the evolutionary chain. It's an eff and flow, but always creeping toward centralization; or, what Reagan called 'creeping socialism.'"
  • "Reagan Reclaimed," by Steven Hayward, in the February 7, 2011 issue of National Review. Hayward writes, "And in discussing Reagan's greatest acknowledged achievement -- ending the Cold War -- liberals conveniently omit that they opposed him at every turn."
  • "Reagan Revealed," by Deroy Murdock, posted February 4, 2011, at National Review Online. Murdock discusses two books by Annelise and Martin Anderson -- Reagan in His Own Hand (670 scripts for commentaries handwritten on yellow legal paper and aired on 236 radio stations from 1975 to 1979) and Reagan: A Life in Letters (about 1,000 of Reagan's letters although more than 10,000 remain).

February 04, 2011

January's Porkers of the Month

Citizens Against Government Waste (CAGW) has named its January porkers -- Senators Sherrod Brown (D-Ohio), Patrick Leahy (D-Vermont), and John Kerry (D-Massachusetts). According to CAGW, the three worthies were selected as January’s porkers for:

“ . . . urging the Pentagon to release taxpayer funds to continue development work on General Electric’s alternate engine for the Joint Strike Fighter. The alternate engine has been criticized as wasteful and unnecessary by taxpayers, the Bush and Obama Administrations, and numerous top military officials. Sens. Brown and Kerry represent states where the engine will be developed and built.”

In naming the three, CAGW said:

“CAGW has long opposed the alternate engine. On May 20, 2010, Defense Secretary Robert Gates made it clear that he will recommend that the President veto any legislation that includes funding for the alternate engine, a pledge that has been reiterated by the White House.  Additionally, in a January 6, 2011 speech about military’s budget, Secretary Gates said that spending limited resources on the alternate engine constitutes excess overhead and is an unneeded program.

“The alternate engine is currently on life support and has been funded off and on with anonymous earmarks since fiscal year 2004.  The project is currently being funded through a continuing resolution which expires on March 4, 2011.

“The alternate engine has been a $3 billion boondoggle and taxpayers should not sink one more dime of limited resources into this failed project. This program has become the epitome of senseless government waste, diverting resources away from other important military projects and expenditures that keep the nation and our troops safe and secure,” said CAGW President Tom Schatz. “The only general who supports the alternate engine is General Electric.”

You can also view Porker of the Month on video, which is co-produced with Reason.tv -- on the CAGW homepage or here at Reason.tv. You can reach the three Senators on Capitol Hill at their Washington offices:

  • Senator Sherrod Brown -- 202-224-2315
  • Senator Patrick Leahy -- 202-224-4242
  • Senator John Kerry -- 202-224-2742 

February 03, 2011

Crying Over Spilled Milk

Thomas Sowell had a great op-ed in yesterday’s edition of Investor’s Business Daily explaining that “only in government do all benefits justify costs.” In the op-ed, Sowell explains:

“We all understand why the Environmental Protection Agency was given the power to issue regulations to guard against oil spills, such as that of the Exxon Valdez in Alaska or the more recent BP oil spill in the Gulf of Mexico.

“But not everyone understands that any power given to any bureaucracy for any purpose can be stretched far beyond that purpose.

“In a classic example of this process, the EPA has decided that since milk contains oil, it has the authority to force farmers to comply with new regulations to file "emergency management" plans to show how they will cope with spilled milk, how farmers will train "first responders" and build "containment facilities" if there is a flood of spilled milk.

“Since there is no free lunch, all of this is going to cost the farmers both money and time that could be going into farming — and is likely to end up costing consumers higher prices for farm products.”

Sowell concludes this great op-ed by writing:

“Weighing benefits against costs is the way most people make decisions — and the way most businesses make decisions, if they want to stay in business. Only in government is any benefit, however small, considered to be worth any cost, however large.”

The EPA/milk example may be a classic one, but it's not the only one cited by Sowell. 

February 02, 2011

Save Friday, February 11, for a Special Event

We’ve growled on frequent occasions about the path to fiscal collapse the U.S. is on primarily because of the the unsustainable growth of entitlements -- most recently here and here.

The National Taxpayers Union Foundation (NTUF) is hosting a forum at CPAC on entitlements, bringing together “policy experts to discuss how to reform Social Security, Medicare and Medicaid.” Here are the specifics:

What: Moving Forward on Entitlements: Practical Steps to Reform

When: February 11th from 2-4 p.m.

Where:

Marriott Wardman Park Hotel
The Coolidge Room
2660 Woodley Road, N.W.
Washington, DC  20008

Speakers include:

  • Rep. Devin Nunes (California)
  • Maya MacGuineas, President, Committee for a Responsible Federal Budget
  • Douglas Holtz-Eakin, President, American Action Forum
  • Dan Mitchell, Senior Fellow, Cato Institute
  • Stephen Moore, The Wall Street Journal

According to NTUF staff, you do not need to be registered for CPAC to attend this important event. So mark your calendars for Friday, February 11. Apologies if you've already been notified of this event by NTUF.

February 01, 2011

Norm Leahy -- Taxpayer Hero!

Last Friday, January 28, we learned about the efforts of Norm Leahy to halt unconstitutional spending in Virginia. At Black Velvet Bruce Li, Greg L wrote:

“There have been several of us over the years who saw annual appropriations by the General Assembly to charitable non-state entities as a flagrant violation of the Constitution of Virginia.  Today Attorney General Ken Cuccinelli confirms that the longstanding practice is indeed against the law.  The difference between my occasional whining and today’s immediate halt to the practice is the involvement of long-time blogger Norm Leahy, who pens at Tertium Quids, instead of me.  He got it done, while I ineffectually griped.”

Greg L, who blogs primarily from the Prince William County area, continued by saying that “every year, members of both parties blindly disregarded the plain language of the Constitution and handed your tax dollars out to all sorts of groups.  Chuck Colgan — a master at redistributive beneficence who called this “bringing home the bacon” — was one of the top spenders of your taxpayer dollars to be directed to non-state entities for many years, as was just about every other member of the General Assembly.

Let Norm continue telling the story at Tertium Quids, where he blogged last Friday:

“Virginia Attorney General Ken Cuccinelli has issued an official opinion (from the Virginia AG’s website, requires Adobe) on whether the state government can provide grants to nonprofit organizations it neither owns nor controls: no it cannot.

“In a letter to Del. John O’Bannon, who requested the opinion on this writer’s behalf, Cuccinelli states that  while this charitable giving may be “…noble in purpose and salutary in effect,” they are also “precluded by operation of Article IV, § 16 of the Constitution of Virginia.”

“This opinion, while it does not make new law, can be cited in court and have typically guided state policy.

“The question now becomes whether the Governor will continue to press for the $1 million worth of grants he is seeking for two private nonprofits and even more, if the Senate will try to keep the nearly $6 million in grants it’s members are seeking for a variety of nonprofits.

[ . . . ]

“But my hope is that lawmakers will follow Cuccinelli’s advice and bring an end to a decades-old, bipartisan practice of handing out taxpayer money in clear violation of the state’s constitution. If they wish to continue doing so, the only option available to them is to amend the constitution. That takes a great deal of time and effort to do, and as Del. O’Bannon indicated to me, it’s not likely such a change would go anywhere (at least in the House).

Anita Kumar of the the Washington Post writes in her blog Virginia Politics.  "State lawmakers have for years gotten around the provision by classifying charities as 'historical' or 'cultural' agencies."

Thank you, Norm, for your efforts in stopping this unconstitutional spending in Virginia. While those taxpayer dollars may not be significant in the overall Virginia budget, it shows what the efforts of even one person is capable of achieving. Again, Norm, thank you for showing us the meaning of individual initiative.

P.S. Maybe the Virginia Tea Party should introduce the Virginia Constitution to members of the Virginia General Assembly, like they did on the opening day of Congress' 112th session. Ya think?