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                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, February 20, 1992                   TAG: 9202200351
SECTION: VIRGINIA                    PAGE: B-1   EDITION: METRO 
SOURCE: GREG SCHNEIDER and ROB EURE
DATELINE: RICHMOND                                LENGTH: Short

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SENATE OKS BOND PACKAGE

The Senate positioned itself for war with the House of Delegates Wednesday, passing a $594 million bond issue for colleges, mental hospitals and parks that is just over half as large as one already approved by the House.

The Senate's package is backed by Gov. Douglas Wilder and calls for repayment of the bonds without new taxes. Under the House version, a brainchild of Majority Leader Richard Cranwell of Vinton, the state would borrow $1 billion and increase the sales tax by one-half cent to repay it.

Cranwell's package includes the governor's plan, plus about $500 million for highway construction. It calls for a referendum this summer on the borrowing and the sales tax increase.

The tax boost would cover annual payments on the bonds, with about $100 million left over to help poor school districts.

Several senior House Democrats said Wednesday a potential compromise involves replacing the sales tax boost in their plan with a 2-cent increase in the gasoline tax. That would raise enough money to cover the bonds for $400 million in transportation projects.

The compromise apparently hinges on efforts to wed the interests of rural and Northern Virginia legislators. The gas tax would not provide enough extra money to help poor, rural school districts, so money for them would have to be found elsewhere.

Keywords:
GENERAL ASSEMBLY

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