COMMONWEALTH of VIRGINIA

Office of the Governor

June 25, 2004

TO THE HOUSE OF DELEGATES

HOUSE BILL 5001

I have signed House Bill 5001, the appropriation bill for the 2004-06 biennium, including eight item vetoes.

The budget and the accompanying tax reform legislation included in House Bill 5018 achieve the fundamental objective sought by the General Assembly and by me when the legislative session began. Taken together, the two bills make the tax code fairer, strengthen the Commonwealth's commitment to essential services, and preserve Virginia's long-term fiscal integrity by restoring structural balance and taking a major step toward replenishing the Revenue Stabilization Fund.

The budget itself includes a number of noteworthy actions. It provides the largest funding increase in history for our public schools, including new state support for almost 10,000 teachers, funding for all unserved, at-risk four year-olds, and additional funding for school technology. The budget reversed the decline in state support for higher education, adding money to support enrollment growth, faculty, equipment, and research. In human resources, substantial funding was provided to meet high priority needs in health care for the poor, services for children, and community-based care for disabled persons. The budget also strengthens efforts to preserve public safety, and it provides a significant new investment in water quality and land conservation programs.

Notwithstanding the substantial accomplishments that we were able to achieve by working together, I did object to certain actions taken in the appropriation bill. I attempted to address these concerns through the amendments submitted to the Reconvened Session. I want to express my appreciation to you for adopting most of them.

Nevertheless, the rejection of some amendments during the Reconvened Session leaves some issues unresolved. Accordingly, I have exercised the authority given to the governor under the Constitution of Virginia to veto certain provisions in the reenrolled appropriation bill. Of my eight vetoes, three are technical and have no substantive effect on the appropriation act. The remaining five are designed to maintain the practice of at least the past 20 years with respect to the Governor's ability to take budget actions while the General Assembly is not in session. In

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addition, those five vetoes preserve the separation of powers between the legislative and executive branches. The specifics of each action are set out below.

Item 111 H.

Funding for the Center for Rural Virginia is listed twice in the reenrolled appropriation bill - once in Item 111 H. and once in Item 507. 1 0 C. 1. To eliminate this duplication, I have vetoed Item 111 H.

Item 144 E.6.

Funding for the Wolf Trap Institute for Early Learning through the Arts is listed twice in the reenrolled appropriation bill - once in Item 144 E.6. and once in Item 507. 1 0 A. To eliminate this duplication, I have vetoed Item 144 H.

Item 261 D.

Funding for a collaborative program at the Science Museum of Western Virginia is listed twice in the reenrolled appropriation bill - once in Item 261 D. and once in Item 507. 1 0 B. To eliminate this duplication, I have vetoed Item 261 D.

§ 4-1.02

The appropriation bill adds a number of limitations to the Governor's authority to reduce appropriations administratively, in the event of an unanticipated revenue shortfall. Several are unnecessarily restrictive. Central among these is the requirement that any proposals for budget reductions required due to a revenue shortfall be released to the General Assembly within five calendar days, whether the proposals are approved or not. Language specifies that this requirement applies equally whether reduction plans are submitted to the Governor, a Cabinet secretary, or a member of the Governor's staff - either electronically or in writing.

Requiring the release of a list of reduction options prepared for the Governor's consideration would have the practical effect of eliminating or severely constraining candid, confidential communication between a governor and his appointees - at a time when such confidential communication is needed most. Such a change also raises constitutional issues regarding separation of powers and executive privilege.

I fully recognize the legislature's legitimate right to full disclosure of information related to approved plans for agency reductions. Indeed, in October 2002, the last time it was necessary to reduce agency appropriations through executive action, the Executive Department was

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forthcoming in providing the full text of all approved budget reduction plans well before the 2003 session.

My amendment proposed to the Reconvened Session would have modified several limitations included in § 4-1.02. In particular, it changed the restriction in the adopted budget bill regarding release of budget reduction proposals by specifying that any reduction plans or modification to such plans that are approved by the Governor would be provided to the General Assembly. Although I felt that this modified approach would provide the General Assembly with complete information, and that my other proposed changes to § 4-1.02 would provide both the Executive Department and the General Assembly with a process for addressing necessary budget reductions that was consistent with the needs of both branches and with the process that has been used successfully in the past, this amendment was not adopted.

Accordingly, I am vetoing § 4-1.02. At the same time, should any budget reductions be required as the result of an unanticipated revenue shortfall, I want to reiterate that all Executive Department agencies will fully cooperate with the General Assembly to share all relevant information necessary to meet its legislative responsibilities. Reporting requirements that have been in place for over a decade and that have served past governors and legislatures well will continue to be followed.

§ 4-1.04 a. and § 4-1.04 b.3.f.

The appropriation bill includes language that attempts to prevent a governor from reestablishing through administrative action an appropriation that has been vetoed. This provision has the effect of contravening the decision of the Virginia Supreme Court in Gilmore v. Landsidle. In that case, the Court held clearly that when the Governor and the General Assembly cannot agree on an amendment to a previously enacted appropriation provision, then that provision is retained in the form in which it was originally enacted into law, just as is the case when any provision of the Code of Virginia for which an amendment is offered is either rejected or the bill is vetoed.

My vetoes following the 2003 session of amendments eliminating funding for the Virginia Liaison Office, and mandating the consolidation of several agencies into the

Department of Business Assistance, are examples where the Virginia Supreme Court's decision has been applied. In those cases, the affected items reverted to the substance of the appropriation provided in the original biennial budget.

If the language in § 4-1.04 a. and § 4-1.04 b.3.f. were to stand, the ostensible effect would be to prevent those items from reverting to the substance of their original appropriation --undermining the decision in Gilmore v. Landsidle. I have therefore vetoed the identical language in § 4-1.04 a. and in § 4-1.04 b.3.f.

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4-1.06 b.

The appropriation bill included language allowing the State Comptroller to authorize the disbursement of up to $3 million against appropriations of a subsequent fiscal year, when an emergency arises or when July I falls on a weekend, provided that the Auditor of Public Accounts provides written concurrence. In practice, this action is very rarely necessary. Nevertheless, the language is not consistent with past practice, and it also raises an important constitutional issue regarding separation of powers.

By requiring the Auditor of Public Accounts to concur in the action of the State Comptroller, the language in question allows a legislative official to unilaterally prevent an executive official from taking action. To cure that constitutional defect, the amendment I submitted would have required the State Comptroller to notify the Auditor of Public Accounts when any instance arose that required such payments. That amendment was not adopted. I therefore have vetoed § 4-1.06 b.

§ 4-8.02 b.

The appropriation bill included in § 4-8.02 b. language requiring that agencies submit to the General Assembly copies of any budget reduction proposals provided to the Governor, the Governor's Cabinet Secretaries, Chief-of-Staff, or the Department of Planning and Budget. This language unduly hampers confidential communication between a governor and his appointees, and raises serious constitutional issues involving separation of powers. I therefore have vetoed§ 4-8.02 b. As they have in the past, executive agencies and the Department of Planning and Budget will continue to provide to the General Assembly copies of budget requests, amendment briefs, and requests for amendments that have traditionally been provided.

Mark R. Warner

Governor