After the third day of a General Assembly special session, a bill from Gov. Timothy Kaine that would increase taxes and revive the Northern Virginia Transportation Authority’s ability to issue bonds has been bypassed by lawmakers in both the Republican-controlled House of Delegates and the Democrat-controlled Senate.
Whether lawmakers decide on any transportation funding plan seems unlikely after three days and more than 75 bills introduced, which range from a statewide gas tax hike from Senate Democrats to auditing the state Department of Transportation and pushing public-private partnerships from House Republicans.
Virginia’s mounting transportation needs were highlighted last week when the Commonwealth Transportation Board approved a six-year plan that would cut hundreds of projects and transfer $2.75 billion from the construction fund to the state’s maintenance fund.
Kaine’s plan, which he touted across the state at 10 town hall meetings, would raise about $1 billion per year over the next six years through tax increases and also revive the NVTA’s ability to issue bonds. Republicans in the House are against any statewide tax increases, and Democrats have not warmed to the governor’s plan.
The Democratic governor’s bill would increase the retail sales and use tax in the northern Virginia and Hampton Roads regions by 1%. The regional sales taxes collected in northern Virginia would total about $306.3 million in the first year and would be dedicated to the NVTA, restoring its power to issue bonds, which it lost in a February state Supreme Court ruling. The regional sales taxes collected in Hampton Roads — about $167.9 million in the first year — would be used to fund seven regional projects in that area.
The proposal would also increase the existing statewide motor vehicle sales tax to 4% from 3%, bringing in an estimated $172.5 million in fiscal 2009. It would increase the statewide annual vehicle registration fee by $10, bringing in about $70.3 million in 2009. Revenue from both would be dedicated to road maintenance.
Lastly, the proposal would create a “transportation change fund,” which would increase investment in transit and rail, as well as fund research into “innovative solutions” to reduce traffic congestion. The fund would consist of revenues obtained from a hike in the statewide grantor’s tax imposed on homes being sold. The increase would generate about $142 million in 2009.
