01.18.01

By Kevin Crossett

Gov. James S. Gilmore, in a press conference outside the Governor’s Mansion on Wednesday, sought to allay fears surrounding Secretary of Finance Ronald L. Tillet’s announcement that the commonwealth’s revenue performance was the worst in a decade.

In a brief statement, Gilmore said he took into consideration last month’s revenue drop when drafting his budget, adding that the financial outlook for this month is much better.

"We knew December wouldn’t be good," he said. Tax collections last month were 11.1 percent below collections in December 1999.

But the governor was optimistic, saying, "Let’s look at January as it develops and see whether it continues to be the strong month it appears to be."

The reduced revenue, as well as flagging support from such senators as veteran Sen. John H. Chichester, R-Fredericksburg, has some people wondering whether Gilmore will successfully move his car-tax cut through the Virginia General Assembly.

"I support the car tax [cut] as much as anyone, but the money just isn’t there," Chichester said. Last week, the Senate defeated a bill allowing the state to borrow money from the tobacco settlement to fund Gilmore’s car-tax cut. The House is considering a similar bill; however, it has yet to come to the House floor.

If Gilmore’s measure passes, Virginians will see a dramatic decrease in the personal property tax on their vehicles.

Gilmore won election in 1997 on a promise to phase out the tax on the first $20,000 of a vehicle's value. At his request, the Legislature has cut the tax by 47.5 percent. This session, the governor wants to boost that to 70 percent - by tapping the tobacco funds.

While supporting the car-tax cut, Delegate Jackie T. Stump, D-Oakwood, said decreased revenues might affect the governor’s plan. But Stump believes a compromise can be reached once all the parties are at the table.

"Let’s look to get and find a different way to deal with this," he said. "I hope they’re able to reach a compromise."

Gilmore remains optimistic. "I’m not backing off," he said. He added that he thinks legislators will listen to their constituents and push the car-tax cut through.

"We’re going to examine all possible options," Gilmore said. "But I think that it would be far too pessimistic to assume that the Senate and the House are going to simply throw aside the priorities of the people and go in a different direction."

Republican Delegate John S. Reid of Richmond, who said his constituents support the governor’s measure, defended Gilmore’s comments. Reid said the tax cut remains a priority this session.

Listing education and the tax cut as his top priorities, Gilmore said emphatically that his administration has funded both in his budget – in accordance with the public’s wishes.

"We believe that we do have strong support in the Legislature because the people are supporting us," he said. "So therefore, naturally, you would expect support from the Legislature."