The beginning of spring marks the end of the 2018 Virginia General Assembly session. Well, sort of. In the case of the budget, there was no resolution, which means the fate of conservation funding and the general path forward is still up in the air. To address this, the Governor has announced that a special session will convene on April 11.
One of the bigger issues taking up bandwidth this year was Medicaid expansion. The House’s budget bill included the expansion, while the Senate’s bill did not — this set up a showdown in the budget conference committee. Due to this and other differences, the conferees were unable to come to an agreement, meaning it will be some time before we know what programs will be affected.
The Budget, Mitigation and the Rate Freeze
Medicaid was not the biggest issue that affected conservation funding. That honor goes to mitigation agreements related to the two proposed gas pipelines and the Skiffes Creek (Jamestown) transmission line.
Mitigation money was cited by both the House and Senate as a reason to defund state conservation programs and agencies. Their argument: a windfall from the mitigation agreements have left conservation programs and agencies with plenty of money. In response, they made cuts to already underfunded programs like the Virginia Land Conservation Foundation (VLCF), as well as changes to the Land Preservation Tax Credit. The Senate also cut general operations funding to the Virginia Outdoors Foundation, incorrectly assuming that mitigation funds could be used toward that end. Fortunately, the lack of resolution with the budget means there may still be time to increase funding for some of these programs.
Another major topic for the session was Dominion’s requested rate freeze of 2015, locking in reviews despite known cuts in federal taxes and other costs of operation. Before I go any further, I have to stop and ask, does anyone remember a time when Dominion wasn’t in charge of writing the rules under which they must live or determining the amount of profit they make? No? Me either. To further illustrate this, let’s take a trip down memory lane…
In 1999, Dominion told us that, to reduce the cost of energy, we should allow the free market to provide what existing regulation of the industry could not — competition. So, they provided bill language. We passed it. Eight years later, they came back and told us deregulation had failed to provide us the competition we desired and that in order to reduce the high cost of energy, we needed to re-regulate. They happily supplied the bill language to accomplish this. We passed it. In 2015, they told us that we had to freeze rates in order to avoid a huge increase in energy prices related to climate change and the clean power plan. And we passed it. But the clean power plan stalled at the federal level and they collected over $700 million in overcharges. Did we learn our lesson? Not so much. As you probably guessed, this winter Dominion happily stepped up to the challenge of correcting the “mistake” by providing us the bill language.
Thanks to many of you and our partners, some of the worst parts of Dominion’s rate freeze correction bill failed to make it through, such as the ‘double dip.’ There are still significant problems. However, the late changes and discussion surrounding the bill gives me hope. Maybe we the people will one day wrest control back from the regulated monopolies. But for that to happen, we must be mindful of the past and hold our politicians and Dominion accountable.
Conservation Funding and Legislation
At the beginning of session, we emailed about our priorities related to conservation funding and a slate of bills, both good and bad. Let’s deal with the funding issues first.
We saw minor improvements in the House and Senate budgets related to Agricultural Best Management Practices and the Stormwater Local Assistance Fund. However, as mentioned before, the mitigation money had a negative impact on the three main conservation grant programs — VLCF, the Office of Farmland Preservation (which provides PDR program funding), and the Battlefield Preservation Fund. Both the House and Senate made cuts to VLCF, and refused to add needed support to the already underfunded grant programs for battlefields and farmland. Lastly, the change to the Land Preservation Tax Credit would reduce the individual claim to $20,000 instead of returning it to $50,000, as required in Virginia code. This change represents a failure of the Commonwealth to honor contracts made with those donating easements, as well as those who purchased credits, raising issues of fairness and ultimately compromising the stability of the credit market.
And now for the bills. While conservation funding issues remain, two bright spots for conservation this session are the defeat of SB499 (Carrico), a bill that would have allowed for the termination of an easement based on economic hardship. Had the bill progressed, it would have severely eroded public confidence in the permanence of conservation easements. As well, we were successful in assisting Delegate Fariss with his legislation, HB1490, a bill to make clear that land conservation tax credits associated with an easement can be transferred to a beneficiary. This will go a long way to ensuring the financial benefits of conservation remain with the family and with the property of origin.
As always, transportation was challenging, with multiple attempts to forward harmful projects outside of the Smart Scale scoring process — a ranking process developed to remove the politics from transportation funding decisions. Most of these attempts died, including an attempt to push the Eastern Bypass of Route 29, both in the budget and with SJ32 (Peake), a study resolution seeking to revive this destructive zombie road.
Anti-regulation bills took center stage this year. While most of this legislation was caught up in an agreement with the Northam administration to review the areas where regulations could be reduced, there were two problematic constitutional amendments (HJ111 Head and SJ69 Vogel) from last session. We are happy to announce that both have died. Had these passed, the issue would have bypassed the Governor and gone to the public for a vote in the November election.
Lastly, there were a lot of bills related to the pipelines. Unfortunately, most of them failed to gain traction, and only two bills passed, SB698 and SB699 (Deeds). This legislation grants the Department of Environmental Quality additional authority related to the inspection of stormwater management and erosion and sediment control and awaits the Governor’s signature.
Conclusion
In summary, there was some good and some bad and a lot left to be determined. Along with tremendous help from you and our partners within the Virginia Conservation Network, we are pleased to have moved the needle in a positive direction some of the bills. Yet we remain concerned with the fate of conservation funding. One thing is clear to us: regardless of where you stand on the mitigation agreements for the pipelines, the money is there to address known and unknown impacts to the natural, scenic and historic resources of the Commonwealth. It should not be used to offset other obligations or commitments Virginia has to protect the water we drink, preserve farms that grow our food and save places for people to experience our natural resources.
This article was written by PEC’s Director of State Policy, Dan Holmes, and featured in our Spring 2018 member newsletter, The Piedmont View.