Inheriting a $4 billion budget shortfall, first-year Virginia Gov. Robert McDonnell (R) said on Jan. 18 he would rely on spending cuts instead of tax increases to get Virginia through its worst financial crisis since the 1930s.
McDonnell also announced several actions aimed at creating jobs and expanding Virginia's economy. He said he would increase the available money for tourism and economic development, including incentives to lure Hollywood producers to make films in Virginia.
The tax pledge was not a surprise. McDonnell said during the fall 2009 campaign that he would not raise taxes if elected. Some political analysts said the dire budget situation could prompt the former attorney general to change his mind, but McDonnell left little room for a reversal in his first State of the Commonwealth speech, even inserting capital letters in the text to underscore his opposition to tax increases.
"Some say taxes must be raised — it's unavoidable," said McDonnell, who will work with a Republican-controlled House and a Senate with a Democratic majority. "If you pass a bill in this recession that raises taxes on the hardworking families of Virginia — I WILL VETO IT. And if you pass a budget embedded with those same tax increases — I WILL NOT APPROVE IT."
McDonnell's predecessor, Tim Kaine (D), had proposed hiking the state income tax to help plug the budget gap.
McDonnell did not say where he would trim government, though he did say he would privatize the state-owned liquor stores. During the campaign, he estimated that eliminating the state-run system would save about $500 million that could be spent on transportation. The speech was thin on transportation proposals, a centerpiece of the campaign, though the new governor pledged to develop specific plans at another time. He did pledge to re-open 19 closed rest areas within 87 days, and to raise the speed limit from 65 mph to 70 mph on rural interstate highways.
Continuing an initiative started by Kaine, McDonnell said he supported reform and restructuring of state government and appointed a commission to study how "to look for new ideas about how to make government work more efficiently and effectively, and within our means."
He also promised an unspecified number of charter schools, and said Virginia should be the first state on the East Coast to drill for oil and natural gas offshore.