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Education and Medicaid are the primary victims of a $4.2 billion state budget deficit as legislators begin to solidify the fiscal 2011 and 2012 biennial state budget.

Both chambers of the Virginia General Assembly unveiled their proposed amendments to former Gov. Timothy Kaine's (D) executive budget Sunday.

The House of Delegates Appropriations Committee stripped the budget of all tax and fee increases Kaine proposed. The Senate Finance Committee restored the funding to localities that offsets car tax payments but kept in some other "user fees," according to Sen. Charles Colgan (D-Dist. 29) of Manassas.

Both proposals restore some unpopular cuts, such as the proposed freeze of a local education funding formula that would have cost Fairfax County $61 million. Overall, the Senate budget would put Fairfax County Public Schools ahead by $56 million, according to Sen. J. Chapman Petersen (D-Dist. 34) of Fairfax.

The House version proposes altering a different funding stream that supplements teacher pay to reflect the higher cost of living for teachers in Northern Virginia, which could cost Fairfax County about $11 million, according to Del. Mark Keam (D-Dist. 35) of Vienna.

"The General Assembly giveth and the General Assembly taketh, I guess," Keam said.

Del. Lacey Putney (I-Dist. 19) of Bedford, chairman of the House Appropriations Committee, said he tried to strike a balance in education funding cuts by reducing state mandates and providing localities with more flexibility for things like class size. But the House version of the budget still cuts upward of $300 million from primary and secondary education.

The Senate budget plan contains about $130 million in budget reductions for k-12 education and restores some higher education cuts Kaine proposed.

Similarly, in health care, Putney proposed restoring funding for services such as Medicaid waivers but changing the eligibility requirements for certain programs to limit them to lower-income residents.

"This is one of the most difficult areas of government to address. Behind many of Gov. Kaine's proposed reductions is the face of an individual with critical needs," Putney said. "Nevertheless, difficult decisions had to be made."

The Senate version of the bill staves off some health care cuts by assuming the state could receive $350 million in additional federal dollars "if Congress passes a six-month extension of enhanced Medicaid funding," Colgan said.

Petersen and Keam said they are willing to consider the approach of changing eligibility requirements for Medicaid services in hopes that cutbacks could be restored as the economy improves.

Another area of major potential savings in both versions of the budget bill is the Virginia Retirement System, which provides public employee pensions. By reducing contributions to the pension fund and altering the level of retirement benefits provided to future hires, the state could save more than $800 million over the next two years, Putney said.

The bills also accept the slightly rosier budget picture painted by Gov. Robert F. McDonnell's (R) financial team. McDonnell 's revised state revenue forecasts upward by $200 million through fiscal 2012.

McDonnell praised the work of both committees and pledged to work with House and Senate budget conferees in a bipartisan manner. The budget reconciliation process is expected to begin this week.

"We will work together across party lines to cut spending while not raising taxes," McDonnell said in a released statement. "As we do this, we will not forget that the reductions we make, while necessary for the future prosperity and vitality of our Commonwealth, will mean real hardships in the near term for many of our citizens."

county executive releases draft budget

Fairfax County Executive Anthony Griffin was scheduled to release his proposed budget for fiscal 2011 just after the Times' print deadline.

As of the last public budget forecasts, Griffin had to grapple with a projected $325 million budget deficit, so significant cuts to county agencies are anticipated.

Visit www.fairfaxtimes.com for full coverage of the budget.

Crossover marks halfway point for General Assembly

The Virginia General Assembly reached the halfway point of the 2010 session last week. At this point -- known as crossover -- the Senate can only consider bills which passed the House of Delegates and the House can only vote on bills already passed by the Senate. All other bills, other than the state budget, are considered dead for the year.

Hundreds of bills have made the cut. The following is a sampling of bills still actively under consideration.

To track the status of any individual bill online, go to http://leg1.state.va.us and click on "Bills & Resolutions."

TRANSPORTATION

House Bill (HB) 856: Increases maximum speed limits on interstates to 70 miles per hour.

HB 1158: Creates regional accounts to fund future road construction projects.

HB 1295: Allows use of photo monitoring to detect motorists using the Dulles Airport Access Highway to avoid tolls on the Dulles Toll Road.

Senate Bill (SB) 229: Mandates all passengers in a vehicle wear a seatbelt, not just front seat passengers.

SB 517: Requires the use of hands-free technology while using a cell phone and driving.

HEALTH

HB 10: Virginia Health Care Freedom Act; states Virginians cannot be mandated to carry health insurance coverage.

SB 464: Mandates health insurers cover diagnosis and treatment cost for autism spectrum disorders in children ages 2 to 6. The proposed bill caps coverage at $35,000 a year.

SB 652: Requires the state Board of Education to develop guidelines for dealing with student athletes who experience concussions.

ENERGY AND ENVIRONMENT

HB 787: Permits offshore oil and gas drilling 50 miles off the Virginia coast.

SB 109: Requires all new state buildings to meet "green" building standards, such as the U.S. Green Building Council's LEED standards.

ANIMALS

HB 488: Requires the Department of Game and Inland Fisheries to develop model ordinances for localities that have high levels of deer-human conflicts, including regulations on hunting.

HB 1145: Mandates veterinarians report suspected cases of animal cruelty.

CRIMES, COURTS AND JAILS

HB 15: Prohibits people charged with terrorism from being held in local or state facilities.

HB 53: Makes it a Class 1 misdemeanor to implant a tracking device in someone without obtaining his or her consent.

HB 1197: Allows a judge to order someone convicted of a first DUI offense use an ignition interlock device. This is now allowed for second and subsequent offenses.

LOCAL MATTERS

SB 64: Allows county employees and designated volunteers to remove illegally posted signs from public rights of way, with permission.

SB 280: Allows county governments to impose or increase a tax on restaurant meals by a majority vote. Counties are now required to hold a referendum to impose a meals tax.

BUSINESS

HB 943: Creates a fund to provide grants to small businesses that create at least five full-time positions within a 12-month period.

HB 1353: Requires any person who transports waste kitchen grease to register with the Virginia Department of Agriculture unless he qualifies for an individual exemption. The bill also creates penalties for not registering.

Elections

HB 1060: Allows Northern Virginia jurisdictions to create staggered terms for their school boards.

HB 1225: Allows localities to continue to purchase touch-screen voting machines in order to maintain one such machine per voting place. A prior state law prohibited local governments from replacing old machines in order to facilitate conversion to optical scan paper ballots.

SB 83: Allows voters to vote "absentee in person" without stating a reason, essentially codifying early voting. The bill maintains the list of requirements to receive an absentee ballot by mail.