Senate bill raising local sales tax moves to House

Daily Press |

--Coming down to the wire on a critical legislative deadline, the state Senate approved a special sales tax surcharge for the Historic Triangle, intended to beef up the region's tourism promotion efforts and lead Williamsburg to reverse the admissions tax and higher hotel and meals taxes approved last year.

The deadline Tuesday -- "Crossover Day" -- is when the House of Delegates and state Senate have to complete work on their bills before turning them over to the other body.

The bill will slate half of the surcharge proceeds for the Williamsburg Area Destination Marketing Committee and half to be divided among Williamsburg, James City County and York County. Senate Majority Leader Thomas K. "Tommy" Norment Jr., R-James City County, sponsored the measure.

"This is unusual tax legislation," Norment said. "You're not just discussing increasing the sales tax, you're eliminating three taxes."

He said the model was the surcharge on fuel and sales taxes that Hampton Roads and Northern Virginia use to fast track long-delayed highway projects, including the widening of Interstate 64 and an expansion of the Hampton Roads Bridge Tunnel.

"We decided to stop begging and whining and look to ourselves for help," Norment said.

The new surcharge should raise $20.7 million in fiscal year 2019 and $23.1 million in fiscal year 2020, according to an analysis by the state Department of Taxation.

Norment's bill, SB 942, passed 27-10.

On Tuesday, the House plowed through nearly 180 bills up for their final vote, and the Senate, more than 70.

Senators approved re-regulating the small loan business while the House put on ice a measure that would let high interest rate Internet lenders operate legally in Virginia.

The Senate bill that caps rates on installment loans to consumers -- the type of loans many people take out to buy appliances, or trailers or Sea-doos -- was a re-regulation requested by the lenders themselves and supported by consumer advocates and Attorney General Mark Herring.

That re-regulation extends the current cap of 36 percent on installment loans for less than $2,500 to apply to all installment loans up to $35,000, and says state consumer protection laws apply, said Jay Speer, executive director of the Virginia Poverty Law Center.

"I think the only people who'd oppose this are online lenders," said Jay Speer, executive director of the Virginia Poverty Law Center.

Unlike licensed consumer finance companies, which make loans for fixed terms of up to 10 years with set monthly installments, Internet lenders charge high rates, often don't bother with credit checks and at times structure credit and charge fees in ways that boost the principal owed.

"These Internet lenders are an entirely different business" than the licensed consumer finance companies that make small installment loans, said the bill's sponsor, state Sen. Scott Surovell, D-Mount Vernon.

The interest rate cap bill, Senate Bill 625, now moves to the House.

Among the bills passing the House and headed for the Senate was one requiring Medicaid's adult recipients to work, if they are not disabled.

The House also approved a bill revising state regulation of electric utilities to allow the use of excess earnings to finance an ambitious, multi-billion-dollar program to install solar and wind generating facilities and modernize their networks of wires and electrical equipment linking customers to power plants.

The House version was amended to include a ban on double recovery of the costs of those facilities, which the Office of the Attorney General and the State Corporation Commission said was a possibility under the bill's mechanism.

The state Senate version, passed last week, did not include that amendment, however. That means the House might decide to add its amendment to the Senate, when that measure is before it; or that the Senate might decide to take the amendment out when it considers the House bill. Any changes to either bill would have to be accepted, and if not, the measures would go to a conference committee to resolve any differences.

"We are pleased the bill has passed the House of Delegates -- and the Senate previously," Dominion spokesman David Botkins said. "We are still studying the effects of the amendment on the House bill."

The House also approved a bill to increase the trigger at which larceny becomes a felony from $200 to $500. The bill was a compromise worked out between Gov. Ralph Northam and Speaker of the House Kirk Cox, R-Colonial Heights.

The Senate also approved a series of bills intended to broaden access to health care.

One, Senate Bill 266, would authorize new neo-natal care units in Hampton Roads, Northern Virginia, Richmond and Roanoke, without having to secure a Certificate of Public Need from the state Health Department, a process critics say protects hospitals and keeps health care costs high.

Another, Senate Bill 844, said managed care companies that want to make money running plans for Medicaid or state employees also have to offer Affordable Care Act coverage to individuals.

A third, Senate Bill 915, proposed a tax on hospitals to provide coverage through Medicaid for more people with serious mental illness, though its sponsor, state Sen. Siobhan S. Dunnavant, R-Henrico, said final word on the financing was in the hands of General Assembly money committees.

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