Dear Friends, Virginians, citizens of Fairfax:

Virginia is a relatively low tax state. That's a good thing. The state and local tax burden here is about 10 cents per each dollar earned, much less than in Maryland and D.C.

Over the past five years, the Assembly has eliminated the sales tax on groceries and increased it a half-penny on other sales. It has created a full tax exemption for inherited wealth, while raising taxes on cigarettes. Finally, it has "capped" the property tax on cars, although that is a long story with very few heroes.

Throughout it all, the effective net tax rate has been .... 10 cents on the dollar.

This year, with the proposed executive budget, a new tax increase is coming. It's an insidious levy which has risen for years with little public outcry. Yet it impacts thousands of young people and has a particular impact on middle-class families in Fairfax County.

It's called increased tuition.

When I was an idealistic young man in 1991, the Redskins were Super Bowl champs, Doug Wilder was the Governor and my tuition at UVA Law School was $4,400.

Today it's $39,000. Yes, that's in-state.

The figures for undergraduate education are less shocking, but the trend line is the same. In 1991, an in-state student paid $2,232 in annual tuition to attend UVA. Today that figure is $9,872 and rising.

There are some mitigating factors, including better access to need-based scholarships. There is also the perverse reality that no college president gets a bonus for making his university "more affordable." However, the real story here is the decline in state support for higher education.

Since 1991, the state's general fund support for in-state college students has dropped $1,000 per student in inflation-adjusted dollars (or about 20% of the baseline). In other words, our higher education system is contracting, even as the demand for that education grows stronger.

This year, the Governor's deficit reduction proposal seeks another 11% decrease in state funding for our colleges. Yes, it's somewhat counterbalanced by Federal stimulus funding, but that is temporary. The cuts are lasting.

Yet the campuses won't shut down. Nor will they eliminate professors. So where is this funding made up? On the backs of our kids and their parents, who rely on a second mortgage or student loan to meet tuition costs. Again, this is for a state school.

Twenty years from now, will someone write an article about the tuition tipping point in 2009 -- or will our universities simply price themselves out of existence?

JCP Notes: Lots of comments on my last post on "Virginia's Next Energy Frontier." Alas, I had a technical mistake which needs clarification. I stated that the "Sale 220" leasehold off Virginia Beach was estimated to produce 20 billion barrels of oil. Actually, that number (provided by MMS) is 120 million, which is the "six day" figure for our U.S. economy. Thank you to my friends in the oil and gas industry that caught that mistake.

Tomorrow, September 29th, is our fundraiser for Creigh Deeds at the Blenheim House in Fairfax City. Details and RSVP info is at www.deedsforvirginia.com/fairfax. If you are supporting Creigh, we hope that you can make it and bring a check. There will be live music from "The Nighthawks"!

Finally, please keep up the comments at www.oxroadsouth.com or contact us at 703-349-3361 with your questions or concerns.

Let us know how we can represent you better.

Sincerely,

Chap Petersen