Category Archives: Governance

The Virginia529 Board Should Be Lauded, Not Criticized

Participation in Virginia 29 pre-paid tuition plan has declined in recent years as measured by the number of accounts and semester-units sold. Graphic credit: Joint Legislative Audit and Review Commission.

State government, local government, universities and independent authorities in Virginia are larded with debt and unfunded liabilities. No one, to my knowledge, has compiled a total inventory of public institutions’ exposure to pension obligations, leases, maintenance backlogs, infrastructure debt, economic development loans, and other long-term obligations. Institutions’ exposure to the vagaries of the economy and fluctuations of interest rates is largely hidden from public view.

One fund operating in the shadows is Virginia529’s tax-advantaged, pre-paid college tuition program. In contrast to the many entities that take on unwarranted risk, however, Virginia529 is a rare instance of sterling governance. The $2.7 billion fund for the prepaid tuition plan is defensively invested to guard against market downturns. It makes a conservative assumption about future returns on its investment portfolio — only 6.25% annually rather than 7.0% for the Virginia Retirement System. And rather than being chronically underfunded as the General Assembly has allowed the VRS to be, Virginia529 is 138% funded. Indeed, the plan is in such solid shape that actuaries judge that it has a 98% likelihood of meeting future obligations to the parents who are trusting that it will deliver on promises to pay for their children’s educations.

Apparently, that’s a problem.

In a review of the 529 plan, the Joint Legislative Audit and Review Commission (JLARC) suggested that the plan is too conservatively run. Its intolerance of risk means that has built up unnecessarily large reserves that make the program unnecessarily expensive. By reducing the size of the pricing reserve on future contract sales from 10% to 7%, JLARC says, Virginia529 could lower the price of an eight-semester contract by $1,851.

Key lawmakers strongly favor the JLARC recommendations, reports the Richmond Times-Dispatch, and they have pressured Virginia529 CEO Mary Morris to adopt the recommendations. Said Senate Majority Leader Tommy Norment, R-James City ominously: “Sometimes there’s a very thin line between defiance and supreme independent confidence.”

True enough, the cost of participating in the Virginia529 plan has surged as the cost of college tuition has consistently outpaced inflation and income growth — a fact that can be attributed (a) to the General Assembly’s cutbacks in support for higher education, and (b) administrative bloat, mission creep and other policies pursued by colleges and universities themselves. Rather than price its plans over-optimistically as, say, long-term care insurers did a decade or two ago only to increase their premiums in order to maintain plan solvency, Virginia529’s governing board prices its product based on the conservative — one might say, cynical — assumption that tuition and fees at Virginia four-year institutions will increase by 5% in the 2018-19 academic year and by 6.5% each year thereafter.

Also true, participation in the plan has declined in the past 10 years as the price has risen, as seen in the chart above. Since fiscal 2009, the number of plan participants has declined from 71,800 to 63,900. Meanwhile, participating families are buying less coverage. The number of annual “semester units sold” has tanked 43% from 18,800 to 10,700 over the same period. Admittedly, that is a disappointing trend.

Virginia529’s investment performance has lagged industry benchmarks over one-, three- and five-year time horizons, says the JLARC report, although it has met or outperformed benchmarks for the 10-year period. “Virginia529 staff, the investment advisory committee, and the program’s investment consultant indicate that the fund is defensively positioned with the intention of protecting assets in down markets and periods of market instability.”

The JLARC report seems to accept that explanation. Staff has a bigger problem with Virginia529’s large pricing reserve. The pricing reserve is a portion of the contract price in excess of the amount needed to pay future contract benefits; the reserve generates surplus revenue to protect the fund against risk. JLARC recommends a guideline that would reduce the pricing reserve as long as the Virginia529 fund has assets in excess of 130% of liabilities. “Reducing the pricing reserve from 10 percent to seven percent would improve affordability of Prepaid529 contracts but would have only a minor impact to the fund.”

Virginia529 staff disagrees. First, reducing the pricing reserve on future contracts creates equitability concerns for those who already purchased contracts. In effect, risk would be shifted to people who paid higher premiums so newcomers could enjoy lower premiums. Second, future dips in portfolio performance could affect actuarial soundness and necessitate returning the reserve to a higher percentage, creating contract pricing volatility. And third, reducing the pricing reserve would have only a modest impact on contract prices. Slashing the reserve to 7% would reduce the price of an 8-semester contract of $67,880 by only $$1,851.

Bacon’s bottom line. Here’s what JLARC and Virginia legislators seem to miss: Virginia529 signs a contract with Virginia families locking in college tuition at a certain price. Virginia529 doesn’t promise to “try real hard” to fulfill the terms of the contract. It will fulfill the contract. It doesn’t have the luxury of raising taxes, or diverting revenue from other programs, or literally borrowing from its investment portfolio and promising to pay it back later, as the General Assembly has done with the VRS. The program should be applauded for adopting an actuarial gold standard.

While JLARC raises reasonable points worthy of discussion by the Virginia529 board, legislators need to butt out. They have no skin in the game. They don’t pay a price if Virginia529 fails to fulfill its promises. If lawmakers want to make college tuition more affordable, they should either (a) increase state funding for public institutions, or (b) do the really hard work of driving costs out of the higher-ed system. Otherwise, brow-beating the Virginia529 board is cheap grandstanding.

Supremes Reject “Compactness” Argument against 2011 Redistricting


Using the courts to reform Virginia’s politicians-pick-their-voters redistricting procedures got harder than ever, thanks to last week’s ruling by the Virginia Supreme Court.

One Virginia 2021, a nonpartisan redistricting reform group, had challenged the 2011 gerrymandering of five House of Delegates districts and six Senate districts on the grounds that they violated the state constitutional requirement that legislative districts must be “compact.” But the Supremes, concluding that reasonable, objective people can reach different conclusions about what constituts compactness, ruled against the challengers.

What Virginia house districts would look like if drawn by Brian Olson to be compact.

“We learn from today’s opinion that there’s a great deal of science in the redistricting process,” wrote Steve Emmert, publisher of the Virginia Appellate News & Analysis blog, immediately after the ruling, “but it’s a social science, not something as readily definable as physics. Both the challengers and the legislature … adduced expert testimony exploring the issue by various means of calculating compactness.”

The opinion written by Justice S. Bernard Goodwyn lays out the challengers’ argument in Rima Ford Vesilind versus the Virginia State Board of Elections as follows:

Article II… of the Constitution of Virginia … provides that legislative districts “shall be composed of contiguous and compact territory and shall be so constituted as to give, as nearly as is practicable, representation in proportion to the population of the district,” as well as federal requirements of “one person, one vote” and the Voting Rights Act. … The complaint asserts that “[w]hile the legislature may consider other rational public policy considerations, the mandates of the United States and Virginia Constitutions can never be subordinated to those considerations.”

The Challengers allege that the General Assembly “subordinated” the mandatory compactness requirements to other public policy considerations, and ignored compactness in favor of “nonconstitutional considerations,” such as “favor[ing] partisan interests” and “protect[in] particular incumbent[s],” “with the result that the Challenged Districts are not within any acceptable objective measures of compactness.”

During a three-day trial in March, Dr. Nicholas Mueller testified how he used software called Maptitude to draw an alternative district map to compare against the 2011 plan. He showed how it was possible to draw districts meeting the constitutional requirements while also refraining from splitting political subdivisions and refraining from pairing incumbents. Also, using the Reock, Polsby-Popper and Schwartsberg scores for measuring compactness, Dr. Michael McDonald showed how the districts enacted by the General Assembly degraded compactness scores by more than 50%.

However, wrote Goodwyn in his analysis of the testimony, “Compactness is a somewhat abstract concept.”

Determining compactness does not admit to a bright line approach in determining whether a legislative district is, in fact, compact. … Social scientists have developed at least 50 different methods of measuring compactness. The proliferation of measures does not provide clarity. It does exactly the opposite. In the social science community, there is no universal definition or consensus as to what constitutes the best measure for compact districts.

Furthermore, wrote Goodwyn:

Contrary to a core premise in Dr. McDonald’s test, the Constitution of Virginia does not require districts to be as compact as possible. [It] simply requires that districts “shall be … compact.” … As the Board observed, the compactness requirement is not based on the same type of objective comparative inquiry as the equal population requirement. …

Our Constitution speaks to the result of the redistricting process, and mandates that districts be compact in the end. It does not attempt to curtail the legislative process that creates the end result. Nor does it require that compactness be given priority over other considerations, much less establish a standard to determine whether the legislature gave proper priority to compactness.

While taking no issue with the Justice’s logic, blogger Emmert expressed his repugnance for the result. “I regard partisan redistricting as a form of blatant political corruption; as a cancer on our Republican form of government. The justices’ decision today means that we, the voters, are the surgeons who must remove this cancer. We can do so by telling our legislators that we insist upon it, and by voting for candidates who will pledge to commit the redistricting process to a nonpartisan group, as six states have already done.”

This Metro Deal Literally Smells

As the General Assembly debates the state’s contribution to the bailing out of the Washington Metro system, Virginians are continually reminded of the company’s history of dysfunctional management. The latest news from the Washington Post:

An investigation by the agency’s Office of Inspector General has found that the grimey, orangey-brown, 1970s-era carpet installed in Metro trains are the product of “exceedingly stringent” requirements likely written to favor one supplier. The 100 percent pure virgin wool specification is no longer in use in the industry.

The recently concluded investigation found Metro’s standards for its carpeting were unchanged for two decades and that no other vendor could plausibly compete for the contract.

Moreover, the carpet lacked a required coating to prevent fungus and mildew, according to Metro Inspector General Geoff Cherrington — though it did meet standards for being fire-resistant and mothproof.

Further investigation found the carpet’s compliance testing was not being performed by an independent facility, as Metro requires, but by a laboratory with ties to the carpet manufacturer.

“The director of the lab used by the vendor is married to the Chief Financial Officer of the company that provided the vendor a line of credit” for the carpet order, according to a synopsis of the investigation included in a report to the Metro board.

Over the years, the WaPo reports, the carpet became known for collecting dirt and grime. “Riders are especially put off by the way it soaks up liquids — be it rain, slush, spilled beverages or um, other fluids — and smells.”

Meanwhile, back in the General Assembly, Republicans are far less amenable than Democrats to providing Metro the $150 million a year in additional support the ailing mass transit agency has requested to work down a maintenance backlog that has contributed to safety incidents, schedule delays, and declining ridership.

The new version of a bill sponsored by Del. Tim Hugo, R-Centreville, has been unanimously approved by the House Transportation Committee and will serve as the basis for negotiations with the state Senate over a final Metro funding bill, reports WTOP. Hugo’s proposal would provide Metro $105 million a year, less than the roughly $150 million requested, and provide the funds only if Metro limits operating spending increases to 2 percent per year.

Further, the bill requires studies and reports on Metro’s governance, labor agreements and the federal law that outlines arbitration rules. “Reforms have to go hand in hand with the money,” Hugo said.

Unlike the proposal recommended by former Governor Terry McAuliffe, the Republican proposal would not immediately require changes to Metro’s Board.

Bacon’s bottom line: This is Virginia’s one opportunity to hang tough and demand long overdue managerial, labor and governance reforms to Metro. Once legislation is passed and the money starts flowing, the Commonwealth loses all leverage over the mass transit system. While the current senior management appears to be more competent then its predecessors, the mal-governance of the system has been spectacular, and it costing Virginia taxpayers (especially Northern Virginia taxpayers) dearly. Without fundamental reform, Metro will remain a festering, oozing, pustular sore that will continue to drain Virginia’s scarce transportation resources.

Transparency and Accountability for EDAs

Image credit: Chesterfield Observer

How transparent and accountable should Economic Development Authorities be to the public?

That’s the fundamental issue raised by Sen. Amanda Chase, R-Chesterfield, who submitted a bill that would require local government approval for all EDA grants and budgets. That bill was defeated by one vote in the Senate’s local government committee, reports the Richmond Times-Dispatch, but Chase said she hopes to resurrect it in the near future.

“Bureaucrats who are not elected by the people should not be allowed to dole out taxpayer money,” said Chase. “I’m tired of elected officials abdicating their responsibility so bureaucrats can do their dirty work.”

The bill arises from a controversy in Chesterfield County over county plans to build an industrial megasite in the Bermuda district. The EDA wants to rezone and buy about 1,700 acres of land as a site for potential large, industrial users. The paucity of so-called megasites in Virginia has been identified as a bottleneck to economic development, ruling out the state for consideration by automobile companies, aerospace firms and other large-scale manufacturers. Success in attracting a major manufacturing concern could create $1 billion in investment and create up to 5,000 jobs.

Chesterfield economic developers contend that EDAs are accountable indirectly because authority members are appointed by boards of supervisors, and EDA expenditures of tax dollars are approved in counties’ budgetary process in open meetings. Additionally, all EDA expenditures are recorded by Chesterfield’s accounting department, and the EDA does an annual audit.

But members of a Chesterfield citizens group, the Bermuda Advocates for Responsible Development (BARD), say they have many unanswered questions about EDA expenditures and the proposed megasite.

EDAs have many powers, including the ability to acquire land and borrow money, said Patrick McSweeney, an attorney speaking on behalf of Chase’s bill. “This creates a shadow government potentially in every locality in Virginia. Once a decision is made by these authorities there is little that can be done about it unless they have done something blatantly illegal.”

“There’s no reason that local governments can’t do what they do,” he said. “There’s no reason not to have (EDAs) as an advisory body.”

Bacon’s bottom line: EDAs do spend millions of local dollars, they do issue tens of millions of dollars in municipal bonds, and their decisions do impact local communities. Virginians should insist upon total transparency in decision making regarding the assembly of land and building of infrastructure in industrial parks, and they should insist that elected officials be accountable for multimillion-dollar grants and expenditures. I don’t see how Chase’s bill does EDAs any harm, and I can’t understand why anyone would object to it.

Safeguard Privacy of Student Contact Info

Sen. David Suetterlein, R-Roanoke County, has submitted a bill that would exempt college student cellphone numbers and private email addresses from publicly available data. Del. Chris Hurst, D-Blacksburg, and Del. Tony Wilt, R-Rockingham, have submitted similar bills. Reports the Roanoke Times:

The bills address concerns raised during the 2017 election when NextGen Virginia, a progressive political group, submitted Freedom of Information Act requests for campus directories from all of the state’s public universities.

The group sought student cellphone numbers in order to seek to drive up voter turnout for Democratic candidates.

In Virginia’s House of Delegates Wednesday, Del. Steve Landes, R-Augusta, highlighted protecting student data as one of the House Republican Caucus’s top education priorities this session.

Disgusted by the “unseemly practice” that progressive political groups took during campaign season, Landes praised legislation from Del. Tony Wilt, R-Rockingham, that also restricts student data, but takes a different route than Suetterlein and Hurst. Wilt’s bill is broader and changes the current “opt-out” system so students have to “opt-in” for their data to be released. … 

“When students and parents provide their personal information to colleges and universities of the commonwealth, they don’t expect that that information would be available to political activist groups and campaigns,” Landes said.

Bacon’s bottom line: Normally, I’m a big fan of open access to government data. But open access needs to be balanced against the right to privacy.

I work at home, and I’m bedeviled all day long by unsolicited calls from telemarketers. I can’t remember the last time I got a phone call from someone whose telephone number I did not provide either personally, by posting on this blog, or by including in the directory of our homeowners association. I’ve signed up for the do-not-call list — while I was typing this sentence I literally got a robo-call from “Greg with the Health Care Enrollment Center” — but it hasn’t stopped the inundation of calls. Accordingly, I have become a big fan of restricting access to personal contact information.

Judging by the Roanoke Times article, students have an opt-out option already. They can prohibit the release of their contact data. It would be interesting to know if that option was honored in the dissemination of data to NextGen Virginia. If it was, that provision arguably is protection enough. But changing the “opt out” provision to an “opt in” strikes me as a justifiable change. Students who want their data to be public still can allow it to be so. At the same time the measure protects those who might carelessly skip over the opt-out box or be oblivious to the ways in which their personal data might be abused.

The Case for Public Comments at University Board Meetings

Norman Rockwell, “Freedom of Speech,” 1943.

The following position paper was published by Partners for College Affordability and Public Trust, a sponsor of the Bacon’s Rebellion blog.

ISSUE: Public Comment for Virginia’s Colleges and Universities

PROBLEM: Currently, the decision to raise tuition and fees on students of Virginia colleges and universities is done without any required public input. Yet rate-setting is one of the most important and consequential responsibilities that any policy board possesses. That’s why the law gives citizens the right to address their respective city council or local board of supervisors – the stereotypical 3 minutes at the podium – prior to these policy bodies setting the local property tax rate.

But the opportunity to provide public comment to inform public decision-making goes well beyond local elected bodies. This right of citizens extends to many appointed policy bodies in Virginia.*

The fact that the affected public, including student and parent consumers, have no say in rate-setting in some of Virginia’s largest enterprises (state colleges and universities) is an exception of the law and defies basic expectation of regular appointed policy bodies in the Commonwealth and their treatment of citizens.

OPPORTUNITY: Creating the expectation that appointed governing bodies of Virginia public colleges and universities at least consider the input of the public prior to setting the tuition-rate would be a fundamental improvement in their governance and responsiveness to the Commonwealth they serve.       

This policy would align the practices of college and university governing boards with the existing requirements of other appointed boards in the Commonwealth.

In addition, at least ten other U.S. states (Arizona, California, Hawaii, Missouri, Montana, Nebraska, Oklahoma, Texas, Utah, Washington) require public comment as part of governing board meetings.

SOLUTION: Require governing bodies of Virginia public colleges and universities to adopt public participation policies that include public comment periods at board meetings. In 2017, the Virginia General Assembly passed a law (SB1376, unanimous vote in both chambers) that requires colleges and universities to notify the public about their plans to increase tuition. The next logical step, is requiring public comment prior to those decisions.

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*The legal requirement for public participation/comment includes, but is not limited to, the following appointed Virginia state boards and commissions (links to statutes):

The State Board of Elections
The Commission on Local Government
The Milk Commission
The Board of Conservation and Recreation
Virginia Soil and Water Conservation Board
State Council of Higher Education for Virginia
State Air Pollution Control Board
Virginia Aviation Board
Virginia Waste Management Board
State Water Control Board
Motor Vehicle Dealer Board
Commonwealth Transportation Board
Commission of the Virginia Alcohol Safety Action Program
Apprenticeship Council
Virginia Workers Compensation Commission
Safety and Health Codes Board
Virginia Employment Commission
Virginia Manufactured Housing Board
Board of Historic Resources

Make College Trustees More Accountable to Students, Taxpayers

Students at Missouri State University’s aquatic center in 2014. Photo credit: New York Times

James V. Koch

In a competition to woo students, public universities are increasingly offering lavish amenities that have nothing to do with education.

The latest trend is lazy rivers, which have been installed at several big institutions, including the Universities of Alabama, Iowa and Missouri. Last year, Louisiana State University topped them all with a 536-foot-long “leisure” river in the shape of the letters “LSU,” part of an $85 million renovation and expansion of its gym. It was L.S.U. students who footed the bill.

At a time when college has never been more expensive, this is the last thing students should be paying for. According to the College Board, tuition and fees at public four-year institutions grew more than 60 percent over the past 10 years. State budgets for higher education have been slashed, and students have to make up the difference.

In the case of L.S.U., the lazy river was financed entirely by student fees, an addendum to their annual tuition. According to the Chronicle of Higher Education, over the past five years, those fees increased by 60 percent, nearly triple the amount L.S.U. students paid in 2000.

Tuition and fee hikes at public universities don’t come out of nowhere. Each has to be approved by a school’s governing board, whose trustees are typically appointed by the governor. Ensuring affordable, quality education is an essential part of trustees’ responsibility, but unfortunately often not part of their practice.

Trustees of public universities are stewards of a public trust that rests nobly on the notion that an enlightened citizenry is vital to a democratic society. They have a fiduciary duty to represent the citizens and taxpayers who support public institutions of higher education, as well as the students who attend them. But even though the best interests of students and taxpayers revolve around college access, affordability and graduation outcomes, too often presidents and boards are more focused on the rankings, reputation and popularity of the institution itself.

In my career as the president of two state universities and a consultant to nearly 50 higher-education institutions, I’ve observed dozens of college presidents skillfully co-opt their governing boards into approving costly projects that make schools look more attractive. (Of course, every college president has to increase costs sometimes. But the goal is to make sure it is necessary, while keeping expenses as low as possible for students.)

Trustees, who typically meet four to eight times each year, are entertained as if they are visiting heads of state, flattered for their service and financial contributions to the institution. College presidents sweeten requests for new buildings and research centers, as well as additional student affairs programming, with cleverly branded words like “promise” and “excellence.” What board would want to withhold promise and excellence from its beloved student body?

College presidents also tranquilize trustees into agreement with impossibly large volumes of reading material. Trustees get binders full of documentation about institutional successes that are padded with expensive plans for increasing growth and reputation. Most come away impressed by their president’s expertise and vision and assured that — thanks to their efforts — the university is on the right track.

The unfortunate truth is that while most college presidents care deeply about their institution’s success, an important part of their job is to shake free more resources. They seldom initiate serious campaigns to contain costs.

This means it falls on trustees to be better prepared to help challenge costly proposals that don’t add educational value. When it comes to state schools, the states themselves should educate trustees to understand their responsibilities to the citizenry and students. Training on big-picture issues and higher-education trends, such as the financial trade-off between instruction and research, the costs of intercollegiate athletics, and the expansion of amenities, would help trustees develop courage to ask college presidents probing questions that look beyond institutional narratives and cherry-picked rhetoric.

Our nation’s governors must also play a role. As they appoint public university trustees, they can and should mandate training to make university boards responsible to taxpayers and students. I don’t mean to imply that trustees should devote themselves to ritual opposition to presidents, who usually possess an unmatched understanding of the institutions they lead.

But presidents are not infallible.

James V. Koch, a member of the board of Partners for College Affordability and Public Trust, served as president of the University of Montana and Old Dominion University. Partners for College Affordability sponsors this blog.

This op-ed, published originally in the New York Times, appears with the author’s permission.

Snuff Out the Smart-Scale Revolt before it Grows

True, I-95 traffic north of Fredericksburg is a nightmare. But circumventing Smart Scale to widen the interstate for 44 miles is a bad idea.

Smart Scale prioritizes road and highway projects in Virginia by collecting metrics for congestion, safety, the environment, economic development and other indicators. Ideally, the scores ensure that scarce road construction dollars will be allocated on the basis of merit, not political pull.

But Smart Scale isn’t working for the Fredericksburg area, argues a Free Lance-Star editorial. A stretch of Interstate 95 between Fredericksburg and the Springfield interchange in Fairfax County has been identified as the location of two of the worst traffic hotspots in the country. Writes the newspaper:

The Virginia Department of Transportation … needs to prioritize the 44-mile project.

VDOT’s Six Year Improvement Program does include $125 million for the southbound Rappahannock River Crossing project, but the last round of Smart Scale did not recommend funding the corresponding northbound river crossing, much less the two-lane expansion Cole envisions.

Instead, Smart Scale directs millions of limited transportation dollars to less-urgent projects, such as pedestrian trails, bike lanes and commuter parking lots.

For 2018, VDOT has greenlighted seven projects in the Fredericksburg District, which includes turn lanes, intersection reconstruction and improving commuter parking lots totaling more than $10 million. Another $14.4 million project will widen Exit 126 off I–95 and Route 1 at Southpoint Parkway.

There’s nothing wrong with these projects. But when they take priority over keeping traffic flowing on the busiest interstate highway in the nation, there’s something wrong with Smart Scale.

Del. Mark Cole, R-Stafford, has introduced a bill for the 2018 General Assembly session that would add an additional north and southbound lane to Interstate 95 from Massaponax to the Springfield interchange: ““Such project shall be funded from existing appropriations to the Commonwealth Transportation Board and shall not be subject to the [Smart Score] prioritization process.”

The changes of the bill passing are just about nil. Why would any other legislator wish to privilege Cole’s transportation priority over their own? Passing this bill would open the floodgates for other legislators asking for exemptions for their own pet projects, effectively scrapping Smart Score as an objective means for funding road projects.

I will readily concede that the aforementioned stretch of I-95 is a nightmare. While I don’t commute on I-95, I use it with some regularity to visit my mother in Fredericksburg and my son in Fairfax. The logjams are so frequent and so bad that I periodically vow to never travel that way again. However, while adding lanes would alleviate congestion temporarily, there is ample evidence to suggest that improving travel times would induce more people to live in Stafford/Fredericksburg/Spotsylvania and commute to work in Northern Virginia. Without changing land use patterns, spending billions of dollars on congestion relief would achieve only temporary benefits.

Adding two more lanes for such a distance would cost billions of dollars. The Smart Scale methodology forces us to compare high-profile mega-projects like widening I-95 to smaller projects that may create more value for the money invested. The small projects don’t generate nearly as much attention, but there are a lot of them, and they add up. Smart Scale represents a big advance over the way Virginia used to allocate transportation dollars. We need to keep it, and that means saying no to legislators who want to carve out special exemptions.

Virginia’s Top 10 Stories (Told and Untold) of the Year

Phew! I finally made it through the all-consuming Christmas season, and I’m still alive to tell the tale. Christmas is a wonderful but grueling time of year for the Bacon family, marked by numerous feasts, expanding waistlines, excessive gift giving, shrinking bank accounts, and considerable out-of-town travel to distant relatives. But I’m back in the saddle at the Bacon’s Rebellion global command headquarters and eager to get the blog cranked back up.

Many publications publish a retrospective look at the “Top 10 Stories of the Year.” I have never done this at Bacon’s Rebellion, but perhaps it is time. A few obvious candidates for the Top 10 stories in Virginia’s political-public policy realm come to mind. Please feel free to add, subtract, modify or opine upon this list in the comments.

  1. Republican wipe-out in the November 2017 election. In a wave election driven largely by anti-Trumpism, voters obliterated the seemingly insurmountable Republican majority in the House of Delegates and elected Democrats to all three statewide offices. The Northam administration will look and act a lot like the McAuliffe administration, but it will have more friends in the legislature.
  2. Civil War statues and the Charlottesville riot. Virginia became the cockpit of U.S. culture wars and the debate on race as national and local media alike fixated on statues that memorialize Civil War generals. The controversy exploded as outsiders flocked to participate in, and oppose, the United the Right rally in Charlottesville.
  3. Virginia’s lagging economy. The U.S. economy gained momentum during the first year of the Trump administration, but Virginia’s economy, once a national growth leader, continues to under-perform. Caps on military spending have hobbled growth in Northern Virginia and Hampton Roads, while Virginia’s rural, mill-town economy continues to struggle. Governor Terry McAuliffe has shined as the superlative state salesman, but his policies have not budged economic fundamentals.
  4. Dominion on the defensive. Dominion Energy, a dominating political presence in Virginia, was a big loser from the election, as an unprecedented wave of anti-Dominion politicians was elected to the General Assembly. Despite making great progress toward solar energy, the electric utility found itself under attack for its rate freeze, the Atlantic Coast Pipeline, and coal ash disposal. In a dramatic, end-of-year gambit, Dominion proposed upgrading its transmission and distribution systems to a more resilient, renewable-friendly smart grid.
  5. Higher-ed mobilizes to defend status quo. The year began with sharp criticism of Virginia’s public colleges and universities for runaway costs, tuition and fees. The year closed with an industry P.R. blitz highlighting the link between higher ed and economic development. Virginia is nowhere near a consensus on how to balance the competing imperatives of affordability, access, workforce development, and R&D-driven innovation.
  6. Death spiral for Obamacare. The Affordable Care Act health insurance exchanges in Virginia entered the year in a slow-motion death spiral due to internal flaws and contradictions. Policies enacted by Congress and the Trump administration accelerated their swirl into oblivion, while offering nothing obvious to replace them. The election of Democrat Ralph Northam will renew the debate over expansion of Medicaid, all but guaranteeing that the focus in Virginia will be on the zero-sum question of who pays for health care rather than how can we improve productivity and outcomes in order to lower costs for the benefit of all.
  7. Interstate 66 and HOT lanes. The McAuliffe administration advanced its signature contribution to Virginia’s transportation infrastructure by developing major upgrades to Northern Virginia’s I-66 transportation corridor. The opening of HOT lanes inside the Beltway erupted in controversy over the fairness and effectiveness of using dynamically priced tolls to ration scarce highway capacity.
  8. Accountability in K-12 education. By some measures, Virginia’s system of public schools made progress in 2017 but by other measures it continued to struggle. One of the most important trends, neglected by the media, is the continued effort by state bureaucrats to use Standards of Learning tests to hold local schools accountable and the continued gaming of the rules by local officials to avoid accountability. Meanwhile, revisions to disciplinary policies to advance social justice concerns has undermined school discipline and made a difficult job — teaching disadvantaged kids — even more difficult. The breakdown in discipline makes it ever harder to recruit teachers to the most challenging schools.
  9. Salvaging the Metro. The Washington Metro heavy rail system needs billions of dollars to compensate for past failures to invest in maintenance, even as it struggles with union featherbedding, declining ridership, and an unwieldy governance structure. Representatives from Virginia, Maryland, Washington, D.C., and the federal government can’t seem to agree on much. Metro is critical for the functioning of the Northern Virginia economy, but Virginia wants to see labor and governance reforms before coughing up billions of dollars to prop up a failing system that, lacking those reforms, inevitably will come back and ask for more in the future.
  10. Turn-around at Virginia’s ports. This end-of-the-year list is gloomy, with an emphasis on crumbling and failing institutions. But there is at least one good news story (which I have neglected to cover on this blog): the revival of the Ports of Virginia. Traffic is booming and profitability has revived.

Appointing Lawmakers to Executive Boards Violates the State Constitution

Virginia constitutional convention, 1830

The boards of 21 state entities are exempt from the state law prohibiting legislators from serving on boards, commissions and councils within the executive branch. They include:

Branch Pilots
Southwest Virginia Higher Education Center
Southern Virginia Higher Education Center
New College Institute
Teacher Education and Licensure
Virginia Interagency Coordinating Council
Board of Veterans Services
Roanoke Higher Education Authority
Online Virginia Network Authority
Virginia Geographic Information Network Advisory Board
Standards of Learning Innovation Committee
Virginia School for the Deaf and the Blind
Substance Abuse Services Council
Criminal Justice Services Board
State Executive Council for Children’s Services
Virginia Board of Workforce Development
Volunteer Firefighters’ and Rescue Squad Workers’ Service Award Fund Board
Secure and Resilient Commonwealth Panel
Forensic Science Board
Southwest Virginia Cultural Heritage Foundation
Virginia Growth and Opportunity Board

Not every one of these organizations has a member of the General Assembly serving on its board, but many do. For example, at the Online Virginia Network Authority, a collaborative initiative to promote online learning delivered by public universities, eight of twelve board members serve in the legislature. Another entity, the SOL Innovation Committee, has four delegates and three senators on its board along with 28 local education administrators.

The author of the following legal article, who goes by the pen name of Publius, argues that permitting legislators to sit on executive-branch boards is an unconstitutional violation of Virginia’s constitutional separation of powers.

— JAB


Would It Be Constitutional to Appoint a Virginia Legislator
to a Board of Visitors of a Virginia Public University
or Other Executive Branch Boards?

by Publius

 The question arises whether it would be constitutional to appoint legislators to serve on the Board of Visitors of a public university in Virginia or on other Executive Branch Boards. Based on the clear constitutional text, on the practical consequences, on the decisions of the Virginia Supreme Court, and on decisions elsewhere, such an appointment would violate the separation of powers.  The answer to the question is not close.

I. The Separation of Powers Clauses

There are two Separation of Powers Clauses in the Virginia Constitution. Article I, § 5, titled  “Separation of legislative, executive, and judicial departments,” requires

That the legislative, executive, and judicial departments of the Commonwealth should be separate and distinct;

And Article III, § 1, titled “Division of Powers,” provides:

The legislative, executive and judicial departments shall be separate and distinct, so that none exercise the powers properly belonging to the others, nor any person exercise the power of more than one of them at the same time;

Appointing a legislator to a university’s Board of Visitors would legislatively interfere with executive branch functions, with no necessity for doing so, thus violating the Separation of Powers Clauses as they have been interpreted by the Virginia Supreme Court. Even more clearly, such an appointment would result in the same person exercising both legislative and executive functions at the same time, with no justification whatever, thus violating the clause I have italicized from Article III, § 1.

These restrictions are not mere formalities. They are designed to protect the people by preventing the concentration of power in one or a few individuals, or in any one branch of government. Each legislator shares in the awesome power to make laws for the entire Commonwealth, including for its universities. No legislator may augment that power by also sharing in the executive-branch power to administer those universities.

II. The Boards of Visitors

The Boards of Visitors of Virginia’s public universities are plainly state agencies in the executive branch, and courts have treated this fact as obvious.[1] Similarly, the General Assembly’s Joint Legislative Audit and Review Commission has recognized that these Boards are part of the executive branch.[2] The Governor appoints persons to the Boards of Visitors,[3] and the Governor can remove Visitors for “malfeasance, misfeasance, incompetence, or gross neglect of duty.”[4] This gubernatorial appointment and removal power plainly locates these Boards in the executive branch.

These Boards exercise executive authority and perform executive functions. They supervise and administer large institutions with substantial assets, many employees, and many students, and in some cases, hospitals and medical practices. They are statutorily authorized to manage their institution’s funds, appoint its president and its faculty, fix salaries and tuition, and buy and sell real estate.[5] They are authorized to regulate parking and traffic, the hiring and firing of employees, and the admission, discipline, and expulsion of students.[6] They are instructed to manage their institution’s endowment[7] and given many powers necessary for the management of medical centers.[8] They have law enforcement responsibilities; they are authorized to establish a campus police department[9] or, at the Board’s election, require a contiguous local government to provide police protection on campus.[10] Continue reading