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McAuliffe to sign budget, veto Medicaid amendment

McAuliffe to sign budget, veto Medicaid amendment

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Gov. Terry McAuliffe will try to bypass the General Assembly to expand health coverage for hundreds of thousands of uninsured Virginians, while attempting to block legislative priorities ranging from judicial appointments to an overhaul of the Capitol complex in Richmond.

McAuliffe said Friday that he will sign a two-year state budget that does not include his top legislative priority — expansion of Medicaid — in order to protect public services and Virginia’s triple-A bond rating in the face of a projected $1.55 billion revenue shortfall.

But the governor also discarded a politically paralyzed legislative commission on Medicaid reform as a way to expand health coverage. He promised instead to move forward without legislative consent to take advantage of billions in federal funding for the uninsured under the Affordable Care Act.

“Let me be crystal clear: I am moving forward to get Virginians health care,” he said in a news conference at the Patrick Henry Building in Richmond.

Frustrated by opposition from Republicans in the House of Delegates, McAuliffe called health care coverage “a moral imperative.” He directed Secretary of Health and Human Resources Bill Hazel to give him a plan by Sept. 1 on “how we can move Virginia health care forward even in the face of the demagoguery, lies, fear and cowardice that have gripped this debate for too long.”

House Speaker William J. Howell, R-Stafford, and other House Republican leaders quickly vowed in response “to challenge this blatant executive overreach through all available avenues, including the court system.”

House Republicans said the governor “has no authority to expand Medicaid unilaterally or without the specific approval of the General Assembly,” and accused him of trying to usurp the legislature’s constitutional powers.

Senate Republican leaders accused McAuliffe of ignoring the division of powers between the executive and legislative branches in the Virginia Constitution and of using tactics employed by President Barack Obama.

“Having failed to obtain a policy goal through constitutionally required legislation, he has declared his intention to do it anyway,” said Sen. Ryan T. McDougle, R-Hanover, chairman of the Senate Republican Caucus.

The battle will move first to the assembly, which will convene Monday to consider McAuliffe’s budget vetoes, including six he announced Friday. A two-thirds majority of each chamber is required to override a gubernatorial veto, which is not likely in a Senate split between 20 Republicans and 19 Democrats.

Sen. A. Donald McEachin, D-Henrico, chairman of the Senate Democratic Caucus, promised that Democrats would stand behind the governor “like a solid wall.”

“If we have to sustain his vetoes by ourselves, we will certainly do it,” McEachin said Friday.

McEachin, a lawyer, also supported McAuliffe’s vow to expand health coverage by unspecified executive actions. “I’m comfortable with the legality of it,” he said, while declining to say how the governor plans to proceed.

Two of the gubernatorial vetoes were aimed at budget amendments imposed by Republican majorities in both houses to prevent him from using the Medicaid Innovation and Reform Commission to expand health coverage through Medicaid or a private insurance plan.

Senate Republicans took advantage of a majority created by the surprise retirement of Sen. Phillip P. Puckett, D-Russell, to undo a compromise reached last year that included a “sum-sufficient appropriation” to expand Medicaid if the new commission achieved reforms to the program required by the assembly.

The amendments eliminated the appropriation and required approval by the assembly before the state could use federal funds to expand health coverage.

McAuliffe said he would veto the amendments and the budget language that created the Medicaid commission, which he described as “a sham.”

Authority for the commission would remain in statute, but the governor said he has directed his Cabinet “not to attend or assist with any more meaningless MIRC meetings.”

A key legal question is whether a governor has the authority to strip such “language amendments” from the state budget.

Sen. Jeffrey L. McWaters, R-Virginia Beach, asked Attorney General Mark R. Herring on Friday whether the governor “could remove language from the budget that is not tied to a specific appropriation” or expand Medicaid unilaterally.

Sen. William M. Stanley Jr., R-Franklin County, who sponsored the Medicaid budget amendments, has called them “veto-proof.”

In 1996, the state Supreme Court ruled against Republican Gov. George Allen when he sought to expend his veto authority over the budget. In that court fight, Democrats in the assembly argued that a governor may only use his line-item veto to scrap individual appropriations, or language amendments tied to appropriations.

Sen. John Watkins, R-Powhatan, one of three Republican senators who support health coverage expansion, said he supports the governor’s veto of the Stanley amendments.

“I can’t blame him,” said Watkins, who said he voted for the amendments “under duress” the night of June 12, because House Republicans threatened to kill the entire budget without them.

“I voted for it once and regretted it ever since,” he said.

But Watkins does not agree with McAuliffe’s decision to abandon the Medicaid commission entirely. “That is currently the only avenue that currently exists for modifications that we can come to consensus on,” he said.

McAuliffe also vetoed $20 million in funding for about 35 vacant or new judgeships, as well as language that would prevent him from making judicial appointments when the assembly is not in session.

“This language is plainly an attempt to significantly limit the power of the governor and is thus unacceptable,” he said.

House Republicans called that and other vetoes “petty and politically motivated.”

“The continuity and operation of our judicial system is of paramount importance and should not be subject to political gamesmanship,” they said in a statement issued by the speaker’s office.

Legislation to fill and expand judgeships was carried in the Senate by that chamber’s Republican leader, Thomas W. Norment Jr., R-James City, who engineered the GOP budget coup last week.

Norment also was the chief advocate of a $600,000 appropriation to allow Petersburg and Chesterfield County schools to reach a cooperative agreement for the county to help the troubled city school system. McAuliffe vetoed the appropriation, which neither locality requested.

Asked whether the two vetoes were aimed at Norment, McAuliffe spokesman Brian Coy said, “They were bad ideas.”

McAuliffe also vetoed funding for the Virginia Conflicts of Interest and Ethics Advisory Council that was created under an ethics reform package that he described as “far weaker than what Virginians deserve of proper ethics reform.”

He promised to introduce legislation next year on ethics and suggested that he will seek restrictions on members of the assembly comparable to those that apply to him and his family. In January, McAuliffe signed an executive order barring himself, his family and his executive staff from accepting gifts worth more than $100.

House Republicans called the veto “counterproductive and unnecessary,” and Norment described it as “especially egregious.”

“The legislation creating that panel was approved by every member of the Senate Democrat Caucus,” Norment said in a statement released by the Republican Caucus.

Norment also chided McAuliffe for issuing a fundraising appeal to support his vetoes “within just a few hours of expressing his ‘concern’” over the ethics legislation.

McAuliffe also vetoed a budget provision that would remove about $4.4 million from a fund to help the state offset revenue losses from federal budget cutbacks, and another to give legislative input on asset forfeitures and settlements reached by the Attorney General’s Office.

Michael Kelly, a spokesman for the attorney general, said the office would continue to work with the assembly on ways to ensure legislative oversight of how such funds are spent but was concerned that the language “could jeopardize the attorney general’s ability to enter into certain settlements.”

The governor also showed he can block legislative priorities without a veto by suspending work on a plan included in the approved budget for this fiscal year to replace the General Assembly Building, renovate Old City Hall, and build a new parking deck at East Broad and North Ninth streets.

The $300 million plan had bipartisan support in both chambers, but McAuliffe said “it simply sends the wrong signal to our people to be constructing expensive new facilities in Richmond at a time when we can’t find $10 million to decrease homelessness.”

(804) 649-6964

Politics editor Andrew Cain contributed to this story.   (804) 649-6964

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