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The Final Week: U.S. 1 Funding Secured and a Transportation Deal

The General Assembly ended with two major policy changes.

This week, the General Assembly ended with a budget and two major policy changes — a historic transportation bill and a Medicaid expansion process that I will discuss next week. 

The budget reported and now on the Governor’s desk contained a $2 million line item to pay for a Tier I Study of U.S. 1 pursuant to the National Environmental Policy Act that I’ve been fighting to secure for four years.  This is the next legally required step towards laying the groundwork for actual major improvements to U.S. 1 between Woodlawn and I-495. 

The transportation bill (HB2313) has statewide and local components.  The statewide component repeals the $0.175 gas tax at the pump and replaces it with a 3.5% unleaded tax and 6.0% diesel tax on wholesalers equal to about a $0.10-0.12/gallon tax at the pump.

To make up the lost $0.05/gallon, the legislation raises the tax on car sales from 3% to 4.3%, raises the sales tax by 0.3% for the General Fund netting $900 million over five years and then diverts $700 million from education, public safety, health care and the safety net to the Transportation Trust Fund.  The bill also enacted a new $100 fee on Virginia’s 91,000 hybrid vehicles on top of existing annual registration and clean fuel license plate fees. 

The bill also enacts three more taxes only for Northern Virginia and Hampton Roads – a 0.7% sales tax, a 3% hotel tax, and a “regional congestion relief fee” of $0.25 per $100 ($1,250 when you sell a $500,000 house).  The first $300 million of these monies must go to the Silver Line and all monies raised in the Northern Virginia District must be spent on transportation improvements in Northern Virginia.

I voted no.  While there is no question we desperately need road funding, I saw this legislation as an overly grotesquely complicated gimmick designed to obscure bad and prohibited policies. 

Our General Fund is starved.  Virginia is spending less on education today than it budgeted in the 2007 biennium.  We have cut Virginia’s general government services to the bone.  This legislation diverts over $1.5 billion from education, healthcare, public safety and the safety net over a decade. 

Balkanizing Virginia into regions of have’s and have not’s is dangerous policy, illegal under the Constitutional of Virginia, and antithetical to the concept of a commonwealth which is premised upon addressing statewide problems collectively and not regionally.  We help with downstate schools and the rest of the state helps with our roads. 

But under this plan, even more General Fund monies are used to fund more statewide needs (rural roads), plus we are now being asked to tax ourselves to exclusively pay our own road needs instead of others around the state pitching in. On top of that, future regional tax decisions are now in the hands of 70 legislators outside of Northern Virginia who can to leverage our region yet again.  This is a step backwards and the exact reason this type of scheme was prohibited in the Constitution of Virginia.

The $100 hybrid tax punishes virtuous behavior, bears zero relationship to reduced road taxes paid, and disincentives energy independence.  Senator Ebbin and I have started a campaign to encourage Governor McDonnell to veto this at www.nohybridtax.com

Moreover, none of this reforms the way that statewide transportation revenue is disbursed.  Northern Virginia is still only worth 1/3rd of a person on the Commonwealth Transportation Board, and during the floor debate, rural legislators bragged of paying less for our roads under this plan than they do now.  

While I respect the opinion of those who worked on and voted for this legislation, I could not justify taxing consumer goods, appliances, and clothing to pay for roads and transit, destroying Virginia’s 100-year nexus between road use and revenue, and voting for legislation that I see as unconstitutional.  These problems could all be solved without robbing our schools, healthcare and public safety by a simple gas tax increase and reform of transportation spending. 

The Governor is likely to sign the bill and in year five, it is estimated to generate about $1.4 billion per year – about 30% of what we need by most estimates – if it survives court challenges.  The revenue is needed, but there are better means to that end.

This was a historic vote and I’m interested to hear your feedback at scottsurovell@gmail.com.  It is an honor to serve as your delegate.

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